Tariff Cuts, Stable Exchange Rates, and New Opportunities Signal Potential Machine Tool Industry Recovery, Says Industry Leader

Chairman of Victor Taichung Machinery Works Co., Ltd., Mr. Bert Huang, said today that "after nearly two years of industry turbulence, smaller manufacturers and customers have exited, while defence and aerospace opportunities emerge. Order inquiries are showing improvement, with urgent orders appearing. There will likely be a recovery after the Lunar New Year, especially if US tariffs on Taiwan fall and the exchange rate holds steady at NT$31.6."

He noted that weak conditions over the past two years triggered industry consolidation. While some small-to-medium manufacturers and customers exited the industry, larger firms have reclaimed subcontracting from smaller players, regaining control over lead times and quality while spurring demand for new equipment.

According to Chairman Huang, last year’s exchange rate spike to NT$29 in Q2, combined with US tariff hikes, eroded competitiveness. Chairman Huang said, "Tariffs dropping to 15%, alongside a stabilized NTD$31.6 rate since Q4, would help Taiwan match competitiveness among Japan and Korea; the rate of NTD$31.6 is an acceptable range for the industry.”

Huang previously flagged defence opportunities under government prioritization, predicting a trough-to-recovery shift this year. Today, he confirmed interest in military and aerospace orders, bolstering prospects amid improving machine tool industry environments.

Yet, he also cautioned that Trump administration policies remain unpredictable, "industry and government must stay vigilant, keep refining operations, and adapt proactively."