The proposed merger between the nation's two major hypermarket operators, Far Eastern Geant (
"Judging from their combined sales last year, RT-Mart and Geant together will be a much tougher competitor for the market's biggest player, Carrefour Corp Taiwan (家樂福)," said Jennifer Wang (王琇姿), senior manager at ACNielsen's retail measurement services.
Wang said the merger would not be completed within a short period of time, as there will be many obstacles to overcome, such as how to bridge the various gaps between the companies, which will take the lead, which brand to use and how to allocate the workforce, among others.
"Therefore it is too early to say what impact it will have," she said.
Wang made the comments on news that Douglas Hsu (
"I have exchanged ideas with Ruentex Group Chairman Yin on this matter ... To form an alliance or even enter into a merger [between the hypermarkets] is definitely possible," Hsu said Tuesday night.
RT-Mart generated around NT$37.5 billion in sales last year with 22 outlets across the nation. Geant saw about NT$16 billion in sales last year and expects to add 7 stores by 2006 to its current 13 outlets.
If these two join together, the market size and sales of the newly-formed company are expected to outshine those of Carrefour Taiwan, whose 32 outlets generated more than NT$50 billion last year.
Wang said the news of their teaming up did not surprise her.
"At the end of 2002, this idea of cooperation was already developed between their French parent companies and an office was established in Shanghai last year to deal with joint purchases of goods," Wang said.
"Of course this movement is aimed at the vast China market, but it will definitely influence the sector in Taiwan," she added.
The France-based Auchan SA holds a 67-percent stake in RT-Mart, and the French group Casino garners 50 percent of shares in Geant.
Taiwan now has more than 100 hypermarts and the density is pretty high among Asia-Pacific countries, according to Wang.
Despite the cutthroat competition, Wang said the proposed strategic alliance between RT-Mart and Geant -- which means a possible joint purchase of goods as well as combining customer-member lists -- would not pose an imminent threat to the biggest player.
"Carrefour Taiwan will have time to expand its business and adjust its merchandise structures," she explained.
But from the consumers' point of view, Wang said the public is not necessarily the winner.
"On the one hand, joint purchases and cooperation would cut back on costs, which should reflect in prices. This is good news for the public," Wang said.
"But, on the other hand, the alliance or even merger will leave customers fewer choices, as the hypermarkets will share more similarities," she said.
By that time, competitors will have to provide different services to differentiate themselves, Wang said.
Both RT-Mart and Geant yesterday stayed low key and refused to elaborate on the details of their proposed merger.
TARIFF TRADE-OFF: Machinery exports to China dropped after Beijing ended its tariff reductions in June, while potential new tariffs fueled ‘front-loaded’ orders to the US The nation’s machinery exports to the US amounted to US$7.19 billion last year, surpassing the US$6.86 billion to China to become the largest export destination for the local machinery industry, the Taiwan Association of Machinery Industry (TAMI, 台灣機械公會) said in a report on Jan. 10. It came as some manufacturers brought forward or “front-loaded” US-bound shipments as required by customers ahead of potential tariffs imposed by the new US administration, the association said. During his campaign, US president-elect Donald Trump threatened tariffs of as high as 60 percent on Chinese goods and 10 percent to 20 percent on imports from other countries.
Taiwanese manufacturers have a chance to play a key role in the humanoid robot supply chain, Tongtai Machine and Tool Co (東台精機) chairman Yen Jui-hsiung (嚴瑞雄) said yesterday. That is because Taiwanese companies are capable of making key parts needed for humanoid robots to move, such as harmonic drives and planetary gearboxes, Yen said. This ability to produce these key elements could help Taiwanese manufacturers “become part of the US supply chain,” he added. Yen made the remarks a day after Nvidia Corp cofounder and chief executive officer Jensen Huang (黃仁勳) said his company and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) are jointly
United Microelectronics Corp (UMC, 聯電) expects its addressable market to grow by a low single-digit percentage this year, lower than the overall foundry industry’s 15 percent expansion and the global semiconductor industry’s 10 percent growth, the contract chipmaker said yesterday after reporting the worst profit in four-and-a-half years in the fourth quarter of last year. Growth would be fueled by demand for artificial intelligence (AI) servers, a moderate recovery in consumer electronics and an increase in semiconductor content, UMC said. “UMC’s goal is to outgrow our addressable market while maintaining our structural profitability,” UMC copresident Jason Wang (王石) told an online earnings
MARKET SHIFTS: Exports to the US soared more than 120 percent to almost one quarter, while ASEAN has steadily increased to 18.5 percent on rising tech sales The proportion of Taiwan’s exports directed to China, including Hong Kong, declined by more than 12 percentage points last year compared with its peak in 2020, the Ministry of Finance said on Thursday last week. The decrease reflects the ongoing restructuring of global supply chains, driven by escalating trade tensions between Beijing and Washington. Data compiled by the ministry showed China and Hong Kong accounted for 31.7 percent of Taiwan’s total outbound sales last year, a drop of 12.2 percentage points from a high of 43.9 percent in 2020. In addition to increasing trade conflicts between China and the US, the ministry said
RSS