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Taiwan Manufacturing Report


Taiwan Machine Tools Industry: Industry Overview Machine Tools in Taiwan


Taiwan’s machine tools industry has been forged over more than 60 years of step-by-step progress and is starting to feature in the ranks of the world’s best-known brands. The Taiwan machine tool industry has consistently ranked in the global top 7 in terms of production value and top 4 for export value, with the industry worth some US$3 billion annually to Taiwan, reflecting both the standard and the quality of the products. Indeed machine tools have consistently played a vital role in supporting the so-called “shallow-dish” economy of the island, where exports account for more than 70% of GDP.


Ranked No.4


in 2013 global exporters of machine tools


American 4.8%


Korea 4.9%


ChinaMainland 6.3%


Switzerland 6.0%


Taiwan 7.9%


Figures provided by the Data Processing Office of the Customs Administration under the Ministry of Finance show that in 2013, Taiwan had total machine tool exports of more than US$3.5 billion, with metal cutting tools accounting for US$2.8 billion of this figure, and metal forming tools accounting for a further US$676 million. The total value of Taiwan’s machine tool component exports for 2013 was more than US$1 billion.


The main types of machine tool exported in 2013 were machining centers, with an export value of US$1.1 billion, followed by lathes, with an export value of US$769 million. The share of metal forming machine tools accounted for by pressing and stamping tools fell by 3.4%, while other forming tools grew by nearly 10%.


The top five destination countries (or regions) for Taiwan’s machine tool exports in 2013 were China (including Hong Kong), United States, Thailand, Turkey and Germany, with analysis of the figures also showing that export performance was particularly strong in Indone- sia and South Korea. Taiwan’s machine tools exports to the Mainland China (including Hong Kong) region were worth some US$1.1 billion, accounting for 34% of exports by market, with the US market second with 11.3%, and


TM1 ManufacturingEngineeringMedia.com | August 2014 Else 16.7%


Thailand third with 6.4%.


Germany 23.3%


Italy 10.1%


Industry Clusters for the Taiwan Machine Tool and Component Industry “Machine tools” are financial assets, but are also the foundations of all manufacturing industries. Providing


services to global manufacturing industries that deliver high rates of return on investment is the mission of Taiwan’s machine tool and component industry. The ability of Taiwan’s machine tools industry to compete with other countries without the support of a strong car industry or huge domestic demand depends entirely on Taiwan’s flexibility and adaptability. This ability to provide custom- ized services underpins the exceptional competitiveness that is the hallmark of the Taiwan machine tool industry. Taiwan is home to world-class industry clusters for the machine tool industry. Viewed from the air, there is a swathe of countryside some 60km long and 14km wide that runs along the Dadu Plateau of central Taiwan; this so-called Golden Valley is home to more than one thousand precision machinery manufacturers and upwards of ten thousand downstream suppliers, employing more than 300,000 people with an annual output of $3 billion. It has the highest output value per unit area and the highest density of any machine tool industry cluster in the world. Without this cluster, Google’s solar farms in the desert would be unable to follow the sun; the top four equipment suppliers for the global semiconductor and display panel industries also use components from here. Without them,


Looking ahead, as the global economic recovery continues to progress, the Taiwan machine tool and component industry has a great opportunity to play an even more important role in the global market as a supplier nation. 2014 is expected to see growth of 15-20%, or possibly even higher, giving Taiwan a good chance of taking fourth place in the global rankings of machine tool manufac- turing regions. In addition to its success in the whole machine market, Taiwan became the third-ranked global supplier region for precision machine tool components as far back as 2010, while the associated companies have expanded their efforts into the semicon- ductor equipment and biomedical industries in recent years. Driven by growth in the relevant industries, parts and component manufacturers are likely to gain substantial momentum in 2014, with growth rates forecast to rise beyond 20%.


Japan 19.9%


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