Executives of Toyota Motor Corp’s Taiwanese dealer departed for Japan yesterday for a meeting at the head office to discuss automobile price hikes in Taiwan.
The increases are likely to be implemented early next year and could range from 3 percent to 5 percent because of the 11 percent appreciation of the Japanese currency against the New Taiwan dollar since March, said Liu Yuan-sheng (劉源森), chief of Hotai Motor Co’s (和泰汽車) Vehicles Operations Group, prior to his departure.
“Price increases are definite — the key question is by how much,” he said.
A 3 percent price hike would have limited impact on the local auto market, but an increase of more than 5 percent would likely hurt demand, he said.
Liu said he hopes Toyota will allow no more than a 3 percent increase in the prices of Toyota and Lexus vehicles in Taiwan.
It might take a while to finalize the price increases, Yu Shiao-chung, general manager of Hotai’s External Affairs Division, told Central News Agency in a telephone interview yesterday.
Toyota had planned to raise its vehicle prices after February next year, but now wants to move up the increase to Jan. 1 since Ford Lio Ho Motor Co (福特六和), Honda Taiwan Co (台灣本田) and Yulon Nissan Motor Co (裕隆日產) have announced price increases of 2 percent to 5 percent that will take effect at the beginning of next year.
Market analysts said that the imminent hikes have compelled local consumers to buy new vehicles.
Toyota’s final decision on price hikes is likely to influence other dealers in Taiwan as Toyota holds the largest market share of more than 30 percent.
Hotai is forecasting overall vehicle sales of 320,000 this year and the number will continue to grow next year on a recovering economy and the expiry of existing vehicles’ service lives.
Liu predicted that annual vehicle sales in Taiwan would hit 330,000 next year and 400,000 by 2016.
There were 6.77 million vehicles on the road in Taiwan last year, 46.1 percent of which were more than 10 years old, government registration figures show.
If even 10 percent of current automobile owners buy new vehicles, there will be at least 300,000 new automobiles on the road, Liu said.
Liu urged the government to follow Japan’s lead and encourage the replacement of old vehicles in the interest of environmental protection and energy conservation.
Tokyo-based Toyota, however, was not as optimistic about Taiwan’s auto market. It has forecast overall sales of 290,000 vehicles next year, which is similar to last year’s figure. It said the Taiwanese economy would be affected by China’s, which is likely to slow next year.
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