U.S. Reciprocal Tariffs Rattle Taiwan Auto Market, Prompting Downward Forecast Revisions from Automakers

The imposition of reciprocal tariffs by the United States has sent shockwaves through Taiwan's automotive market, prompting a wave of delayed purchases among consumers who had initially planned to buy vehicles. According to industry sources, with only five months remaining in the sales calendar, the annual auto market is now expected to experience a sharp decline compared to last year. Several automakers have already revised their full-year projections downward.

Luxury imported car brands are reportedly holding significant inventory levels, with some having scaled back their annual sales forecasts to their overseas headquarters. Import volumes originally slated for delivery have also been strategically reduced in an effort to cushion the impact of the new tariffs.

Ho Tai Motors initially held an optimistic view of the July market, buoyed by a surge in deliveries and customer visits in early July. However, as the government continues to withhold a formal announcement on import tariff policies, consumer sentiment has cooled, leading the company to adopt a more cautious outlook for the remainder of the year.

Industry insiders noted that, until recently, Ho Tai Motors was one of the few brands still performing well, while most other brands were facing sluggish sales.

Dealers emphasized that the current inventory situation—especially among importers—is unusually high. Many had anticipated that once the government clarified its tariff stance, they could begin offloading stock gradually. Yet with the year quickly winding down and no policy in sight, it remains uncertain whether the slump in demand is temporary or indicative of a longer-term shift. As a result, deep discounts—often exceeding 10%, and in some cases approaching 20%—have emerged across the market, adding to overall instability.

To mitigate potential losses and support dealership operations, some automakers are now slowing the pace and volume of vehicle imports, while closely monitoring government policy developments before making further strategic moves.