IHS Markit’s Taiwan manufacturing purchasing managers’ index (PMI) last month climbed to a decade-high of 59.4 as firms reported a sharp increase in new business and output amid soaring input costs and worsening supply delays.
PMI figures seek to show the health of the manufacturing industry, with scores above 50 indicating expansion and values below indicating contraction.
Last month’s score rose from 56.9 in November, signaling the strongest pickup in operating conditions since January 2011, the monthly survey showed on Monday.
Photo: Sam Yeh, AFP
“Taiwan’s manufacturing sector had a strong end to last year, with firms registering the steepest upturns in output and new orders for nearly a decade,” IHS Markit economics associate director Annabel Fiddes said in a statement.
Rising inflows of new work prompted firms to expand purchasing activity at a rapid rate, Fiddes said.
The new business gauge expanded at the sharpest rate in a decade, with firms citing a further rebound in sales as the effects of the COVID-19 pandemic continued to unwind, she said.
Growth in new exports also hit a near-decade high, as companies reported stronger demand in many of the nation’s major external markets, the survey found.
The data also pointed to renewed increases in pre and post-production items, as firms stockpiled goods amid strained supply chains and greater customer demand.
Although firms registered steeper increases in production and sales, they adopted a cautious approach to staffing levels, which drove a rapid increase in work backlogs, IHS Markit said, adding that backlogs increased at the sharpest rate since February 2018.
Stock shortages, limited capacity and port delays led to a substantial lengthening of suppliers’ delivery times, it said.
Supply shortages and delays contributed to a substantial rise in input costs, which led to a marked increase in output charges, it added.
Average input prices rose at the steepest rate since December 2016, driven by increased raw material prices and stock shortages, IHS Markit said.
To help maintain profit margins, firms passed on higher operating expenses to customers by raising selling prices at the quickest pace since March 2011, it said.
Encouragingly, firms reported greater demand at home and abroad, with growth in export sales rising to its highest level in nearly 10 years, Fiddes said.
Expectations that global demand conditions will continue to improve over the months ahead boosted business confidence to a 33-month high, she said.
However, supply chain disruptions, rising costs and the resurgence of COVID-19 infections in several export markets could weigh on growth, she added.
The government yesterday approved applications by Alphabet Inc’s Google to invest NT$27.08 billion (US$859.98 million) in Taiwan, the Ministry of Economic Affairs said in a statement. The Department of Investment Review approved two investments proposed by Google, with much of the funds to be used for data processing and electronic information supply services, as well as inventory procurement businesses in the semiconductor field, the ministry said. It marks the second consecutive year that Google has applied to increase its investment in Taiwan. Google plans to infuse NT$25.34 billion into Charter Investments Ltd (特許投資顧問) through its Singapore-based subsidiary Fructan Holdings Singapore Pte Ltd, and
Micron Technology Inc is a driving force pushing the US Congress to pass legislation that would put new export restrictions on equipment its Chinese competitors use to make their chips, according to people familiar with the matter. A US House of Representatives panel yesterday was to vote on the “MATCH Act,” a bill designed to close gaps in restrictions on chipmaking equipment. It would also pressure foreign companies that sell equipment to Chinese chipmaking facilities to align with export curbs on US companies like Lam Research Corp and Applied Materials Inc. The bill targets facilities operated by China’s ChangXin Memory Technologies Inc
Singapore-based ride-hailing and delivery giant Grab Holdings’ planned acquisition of Foodpanda’s Taiwan operations has yet to enter the formal review stage, as regulators await supplementary documents, the Fair Trade Commission (FTC) said yesterday. Acting FTC Chairman Chen Chih-min (陳志民) told the legislature’s Economics Committee that although Grab submitted its application on March 27, the case has not been officially accepted because required materials remain incomplete. Once the filing is finalized, the FTC would launch a formal probe into the deal, focusing on issues such as cross-shareholding and potential restrictions on market competition, Chen told lawmakers. Grab last month announced that it would acquire
SECOND-RATE: Models distilled from US products do not perform the same as the original and undo measures that ensure the systems are neutral, the US’ cable said The US Department of State has ordered a global push to bring attention to what it said are widespread efforts by Chinese companies, including artificial intelligence (AI) start-up DeepSeek (深度求索), to steal intellectual property from US AI labs, according to a diplomatic cable. The cable, dated Friday and sent to diplomatic and consular posts around the world, instructs diplomatic staff to speak to their foreign counterparts about “concerns over adversaries’ extraction and distillation of US AI models.” Distillation is the process of training smaller AI models using output from larger, more expensive ones to lower the costs of training a powerful new
RSS