The global economic development is weak in 2019. Events such as the China-US trade war, Brexit, Hong Kong anti-extradition, and Taiwan’s presidential election have greatly increased economic uncertainties.
The Future Trend of Taiwan's Machine Tool Industry
In the second half of 2019, as the China-US trade war changes, In addition, the global raw material and manufacturing market is weak, the growth of emerging markets is slowing, and the investment of manufacturers in the world is relatively conservative, and the cross-border restructuring of the supply chain and technological transformation have gradually become necessary strategies.
The pace of supply chain reorganization and integration of high-tech and traditional manufacturing industries is accelerating. From a manufacturing perspective, Taiwan’s electronics and traditional manufacturing supply chains have long relied on the productivity of factories in mainland China, accompanied by rising labor costs in mainland China, uncertainty in Apple’s orders, and the triple attack of tariff hikes caused by China-US trade, the pressure to reduce costs is also increasing, and profit margins are therefore compressed. As a result, the original bargaining advantages of multinational OEMs have been gradually weakened. Therefore, the most special phenomenon in the high-tech and semiconductor manufacturing market is the rapid movement of production bases in the global electronics industry supply chain. The China-US trade war has shifted the semiconductor production base. For example, electronics manufacturers located in the downstream of the industry (such as Taiwan's five major electronics foundries) have moved their production capacity to southeast Asia, west to the Americas, or back to Taiwan for production in 2019.
The sales of machine tools can be used as one of the observable indicators of capital investment. According to the statistics of the Taiwan Machine Tool & Accessory Builders’ Association, the export value of Taiwan machine tools in May 2020 was approximately US$183 million, a slight decrease of 0.9% compared with April. Compared with the same month last year, it was down 43.4%. Among them, the export value of metal cutting machine tools in May 2020 was nearly US$159 million, an increase of 1.7% compared to April's exports. The export value of metal forming machine tools in May 2020 was nearly US$24.03 million, which was a decrease of 15.3% compared to April.
From January to May of 2020, the cumulative export value of machine tools was US$921 million, down 30.2% from the same period in 2019. Among them, the export value of metal cutting machine tools was about US$771 million, a decrease of 30.1% from the same period last year. The export of metal forming machine tools, the amount was US$149 million, a decrease of 30.9% from the same period last year.
Future Prospects of High-tech and Traditional Manufacturing
Business Continuity Management (BCM) to strengthen the supply chain is to ensure continuous operation in emergency situations in the event of an accident or disaster in the organization. By implementing continuous operation management operations and continuous operation plans, accidents or disasters or management failures When it occurs, the impact and interruption time are minimized.
The uncertainty of the China-US trade war is still high. In order to reduce tariff costs and respond to the supply chain risks caused by the epidemic, companies can consider alternatives to existing product supply chains to obtain certificates of origin from other countries and integrate upstream and downstream supplies. To reduce the risk of production sites, it also strengthens the flexibility of the supply chain, by seeking opportunities for industrial mergers and acquisitions, or even cooperating with competitors to transfer key production areas from mainland China to other countries such as Southeast Asia.
Facing the maturity and application of AI and 5G technologies, as well as the sustainable development trend, Taiwan's high-tech manufacturing and traditional manufacturing industries have begun to deploy, and it is expected that there will be good development and performance in the next ten years. However, the general manufacturer has a small operating scale and needs to find its own niche market to make a breakthrough in revenue. Otherwise, many small and medium-sized Taiwanese manufacturers will be submerged in the wave of new technologies; however, how to initiate mergers and think about how to play Synergy after mergers and acquisitions is a major issue for Taiwan SMEs.
Ares Seiki Boosts R&D Energy
There has been a rapid development in the field of mechanic engineering with the tool machine as the main product. In order to promote the business, Ares Seiki continues to rigorously develop, consolidate the foundation, and advance their expertise. Ares Seiki has become stronger that improve, increase the performance of the products, perfect the machine tools, and create abundant benefits for the customers with the best service quality and reassurance.
Innovation and R&D have the pursuit of fast and accurate demands from global markets. The requirements for efficiency and productivity have also been constantly rising. Therefore, ARES MACHINERY CO., LTD. continues to innovate, develop new models, and continue to improve the original model. ARES successfully developed AF5040 5-face CNC Vertical Machining Center in 2020.
Ares Seiki not only provides outstanding central machinery products but also offers exceptional after-sales-service to all clients, if you want to learn more information, please visit Ares Seiki.