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China's Strong Auto Market to Buoy Taiwan's Related Industries

2020/10/19 | By CENS

Taiwan's auto parts market has seen positive impacts as the Chinese automotive market continues to grow in its sixth consecutive month. Hotai Motors and Yulon Nissan Motor are the two significant firms enjoying the leverage.

The island's related industries are benefiting from the strong performance of China's automotive market. Industry members say as long as competitive Taiwanese firms maintain the ability to produce, business from China will continue to roll in.

The Chinese auto sector managed to rebound after the second quarter this year, as the country was hit hard by the COVID-19 pandemic, which originated from Wuhan.

According to the latest statistics released by the China Association of Automobile Manufacturers (CAAM), Chinese sales in September reached 2.565 million vehicles, a 12.8% increase compared to last year. CAAM data indicates that China's vehicle sales have been growing over the previous six months and maintaining growth above 10% for five consecutive months.

Overall, vehicle manufacturing in China still fell short of last year's numbers. The total vehicles produced in the previous nine months amount to 16.957 million vehicles, a 6.7% decrease compared to 2019; in terms of sales, that number is a year-on-year decline of 6.9%, 17.116 million cars sold.

Hotai and Yulon are the two firms that have closer ties with the Chinese market. Yulon Nissan's vital reinvestment profits come from Dongfeng Nissan, while Hotai has a reinvestment company handling Toyota dealership in China. Toyota vehicles reported a glowing Q2 sales result; the reinvestment company was a factor in its success.

Other segments, such as new energy-powered vehicles and Vehicle IoT, are all factors that would buoy the market development of Taiwan's related parts.