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Die Casting News from China and Taiwan

August 31, 2010

Taiwan's Tooling Industry to be Affected by ECFA

In 2009, Taiwan imported NT$2.4B worth of tools from China, about 64% of overall tooling imports in Taiwan; whereas China imported NT$5.5B worth of tools from Taiwan, about 8.6% of the Chinese tooling import market. Clearly there is close interaction between the tooling industries of Taiwan and China.

Tooling is one of the markets to be opened mutually via ECFA, as early drafts demonstrated in June of 2009. The tooling markets to be affected include those for extrusion, sheet metals, die casting and plastics injections.

March 5, 2010

Outlook for Taiwan's Tooling Industry

China is the larget tooling export market for Taiwan. In 2008, Taiwan exported NT$6.4B worth of tooling to China, making up 1/3 of its overall tooling export. ECFA will definitely impact the domestic tooling industry in Taiwan, by further opening up the Chinese market to Taiwan's tooling manufacturers. Currently the largest exporting countries to China are Japan (35%), Korea (20%), and Taiwan (13%). With ECFA, Taiwan will gain tarrif advantage (by 5-8%), which it can leverage to further increase its market share in China, and counter Korea's tarrif advantage (of 1.2-8.4%) via its trade agreements with China. As a result, Taiwan might buy some time to upgrade its tooling industry's technology, and lessen the pressure to move to lower labor cost regions.

The immediate impact from ECFA might be on plastic injections industry, as currently Taiwan's manufactureres are protected by higher tarrifs (to be lifted by ECFA).

MIRDC forecasts Taiwan's tooling output to be NT$48B, a 25% growth from 2009.