Forecast and Trends of Machine Tool
The ever-changing situation of the US-China trade dispute continues to disrupt global investor confidence. However, with the initial agreement between the US and China's top leaders, the tariff war has ceased, and the world is optimistic that the long-repressed manufacturing and consumer activities can be restored. In 2019, Taiwan's machine tool exports decreased by nearly 20%, but China's orders for Taiwan's machine tools have bottomed out. Although the sales of bulk machine tools have fallen by nearly 20%, demand for some products such as lathes and grinders has gradually emerged. It is initially estimated that the output value of Taiwan's machine tools in 2019 will decrease by 15% compared with the same period last year, with an output value of 155.6 billion yuan. Looking ahead to 2020, although international forecasting agencies do not believe that the global economy will rebound significantly, at least the worst time has passed. China’s economic growth has slowed year by year, but supply-side reforms continue to advance, and under the catalysis of the US-China trade dispute, there is still the possibility of accelerated progress in 2020; Southeast Asian emerging markets are the beneficiaries of the US-China trade war, and foreign investment Export trade has increased compared with previous years, and with the support of the supply chain and policies, the prospects are still promising, bringing new opportunities for processing equipment. In general, the Industrial Technology Research Institute predicts that the probability of a decline in the output value of Taiwan's machine tool industry in 2020 is still high, but the decline will gradually converge, and there will be a chance for positive growth in the second half of the year. The primary task of Taiwanese machine tool manufacturers is to strengthen their system integration (System Integrate) capabilities and develop automated flexible manufacturing units. At the same time, they should integrate the industrial Internet of Things (IIoT) technology to develop the machine networking functions of client factories to provide end-users with overall solutions. product. As manufacturers in China and major manufacturing countries tend to be conservative in equipment investment at this stage, manufacturers are only willing to install new equipment upgrades on familiar old machines. On the one hand, the networking function of the machine can lower the manufacturer’s psychological threshold. It provides new options for manufacturers who intend to introduce industrial Internet of Things (IIoT) technology.
Current status of Taiwan's machine tool industry
Looking back at 2019, the most important event is still the uncertainty brought about by the US-China trade dispute, which in turn caused a slowdown in economic activities such as global trade and investment. The economic growth forecasts of major countries around the world use Sluggish Growth to warn of possible downside risks in the economy. Fortunately, in December last year, China, the United States, and China reached the first phase of the trade agreement. The United States suspended indefinitely the 15% tariffs that it was originally expected to impose on notebook computers and smartphones worth about 160 billion US dollars worth of Chinese exports to the United States; at the same time, The 120 billion yuan of goods (mainly agricultural products, clothing, and footwear) for which 15% tariffs were imposed in September also dropped to 7.5%. The world is optimistic about the positive development of the US-China trade, which will revitalize the long-repressed global manufacturing activities.
Regarding the current situation of Taiwan's machine tools, with the sharp decline in energy and raw material prices from 2015 to 2016, the utilization rate and orders of manufacturing in emerging markets have turned conservative, while the restructuring of the growth order brought about by the structural adjustment in mainland China and the recovery in Europe and America The strength is not as strong as predicted, and the major competitors such as Japan and Germany have used depreciation methods to strengthen their price competitiveness, which has caused a significant impact on the Taiwan machine tool industry, which is highly dependent on the export market, and the output value of Taiwan's machine tool industry has declined for two consecutive years. Fortunately, in the first half of 2017-2018, due to the steady growth of the global economy and the active application of emerging technologies, the prices of international crude oil and raw materials continued to rise and remained high-end, coupled with the rebound in infrastructure construction and private investment in Mainland China, which led to a continuous increase in Taiwan’s machinery export orders. The machine tool industry also performed steadily, with double-digit growth in output value for two consecutive years.
However, from the second half of 2018 to 2019, the trade dispute between the United States and China has gradually intensified and has even escalated to the dispute between the two countries’ technological leadership. Increases in tariffs and transportation costs have affected the investment confidence of companies in most countries, and consumption momentum has become conservative (especially It is the automobile market), Taiwan's machinery orders and machine tool exports have also been affected. It is estimated that the output value of Taiwan's machine tools in 2019 will decrease by more than 15% compared with the same period of the previous year.
The report of the United Nations Conference on Trade and Development pointed out that the world economy is gradually developing against globalization. From the perspective of global foreign direct investment (FDI), its scale has been reduced for three consecutive years. Last year, the global foreign direct investment flow decreased by 13% to 130 million US dollars, which is also the lowest level since the global financial crisis, which also highlights the lack of international investment in the past decade. However, the main reason for this is the rapid decline in investment flows to developed countries, especially in Europe. FDI flows to the United States have also declined. Although global FDI continues to shrink, the flow of FDI to developing countries is growing in reverse, especially in the African market. Under the rapid development of infrastructure and industry in Africa, market business opportunities are booming, and it is also an economic hot spot considered by many economists. Future market dynamics will continue to be observed.