Domestic automobile suppliers and dealers are experiencing reduced sales and last-minute cancelations in orders as customers adopt a wait-and-see attitude toward the government’s auto industry rescue measures.
The usual wave of year-end car purchases has dissipated as a result, auto dealers said yesterday.
“We are experiencing sporadic car cancellations since the government’s auto rescue plan came into the spotlight. Sales have been slow since the beginning of this year,” Chen Chun-liang (陳俊亮), spokesperson for Honda Taiwan Co (台灣本田), said by telephone yesterday.
Domestic car sales dropped by nearly 30 percent from last year, while sales of imported cars dropped by 23 percent, Chen said, refusing to comment on a government bailout plan as “everything is still under discussion.”
The local auto industry peaked in 2005 with more than 510,000 cars sold that year. Since then, the business has declined to 326,000 units sold last year, and a projected 220,000 to 230,000 units this year.
Imported luxury cars performed comparatively better, said Justin Chen (陳勇成), marketing communications manager of Universal Motors Traders (永業汽車).
“We are witnessing a 20 percent decline in business in today’s tough environment, but thankfully our customers are loyal BMW fans, so our high-end business remains relatively stable,” he said.
Chen is conservative about next year’s business outlook, but admits that this year no wave of year-end car purchases has been seen, likely because of a lack of clarity on the government’s bailout measures.
“If no visible plans are available to the public, it will definitely hurt our business, with consumers waiting on the sidelines,” Chen said.
Auto dealers say buyers are taking longer to decide on purchases, and the people coming into showrooms are few and far between. Now with the rescue plan in limbo, more buyers will be deterred from purchasing cars.
Officials at the Ministry of Economic Affairs (MOEA) Industrial Development Bureau said by telephone yesterday that so far no preliminary auto industry rescue plan had been outlined.
But the Council for Economic Planning and Development said yesterday, that once the MOEA and Ministry of Finance reach an agreement on a preliminary plan, it would present it to the Executive Yuan in time for the economic and business redevelopment plan forum (振興經濟產業再造計畫) on Monday.
Local media yesterday speculated that those retiring older vehicles may receive a rebate of between NT$50,000 (US$1,497.41) and NT$150,000 through various commodity and export tax reductions.
Media focus came to rest on the automobile industry rescue plan on Wednesday after Chinese Nationalist Party (KMT) Legislator Chiu Ching-chun (邱鏡淳) urged council Chairman Chen Tian-jy (陳添枝) to tend to the ailing industry.
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