The business climate monitor for the manufacturing industry turned “blue” in March, from a revised “yellow-blue” in February, as demand, selling prices and operating conditions weakened, the Taiwan Institute of Economic Research (TIER, 台灣經濟研究院) said yesterday.
The business composite index compiled by the Taipei-based think tank shed 0.56 points to 10.41, reflecting listless manufacturing activity, as global clients continued to adjust inventory amid poor sales.
TIER uses a five-color spectrum to capture the industry’s movements, with “red” indicating a boom, “green” suggesting steady growth and “blue” signifying a downturn. Dual colors indicate a transition to a better or worse condition.
Photo: CNA
Taiwan is home to the world’s leading suppliers of electronics used in smartphones, personal computers, wearables, TVs, vehicles and cloud computing.
A majority of local manufacturers, 51.75 percent, reported a decline in business, while 35.51 percent experienced a soft patch and 12.16 percent held steady, the institute’s monthly survey found.
None experienced a boom, it added.
The findings came even though firms in Taiwan and Asia emerged unscathed from bank failures in the US and Europe, TIER said.
The cost and input readings gained a meager 0.17 and 0.07 points respectively after the global economic slowdown cooled raw material prices and eased cost burdens, the institute said.
However, the gauges for demand, selling prices and overall operating conditions declined further, as inventory corrections dragged on, prompting local manufacturers to cut capacity to protect their margins.
For instance, petrochemical product suppliers opted to conduct annual equipment maintenance after outbound shipments and orders tumbled more than 30 percent from a year earlier, TIER said.
Plastic and rubber product makers saw business shrinking by a similar amount, despite the peak season starting, the institute said.
Tepid market demand in the US and Europe was to blame, but China added to the problem by cutting its dependence on one-off plastic products, it said.
Makers of textile products, while benefiting from rush orders in the wake of China’s reopening, saw sharper declines in production and business orders, as apparel brands turned conservative about inventory, it said.
Paper product vendors had a mixed showing, as a recovery in tourism and commerce boosted demand for shopping and packaging bags, but paper products for industrial use floundered, the institute said.
Vehicle sales picked up after chip shortages came to an end, enabling local suppliers of auto parts to report steady business growth, it said.
HORMUZ ISSUE: The US president said he expected crude prices to drop at the end of the war, which he called a ‘minor excursion’ that could continue ‘for a little while’ The United Arab Emirates (UAE) and Kuwait started reducing oil production, as the near-closure of the crucial Strait of Hormuz ripples through energy markets and affects global supply. Abu Dhabi National Oil Co (ADNOC) is “managing offshore production levels to address storage requirements,” the company said in a statement, without giving details. Kuwait Petroleum Corp said it was lowering production at its oil fields and refineries after “Iranian threats against safe passage of ships through the Strait of Hormuz.” The war in the Middle East has all but closed Hormuz, the narrow waterway linking the Persian Gulf to the open seas,
Apple Inc increased iPhone production in India by about 53 percent last year and now makes a quarter of its marquee devices there, reflecting the US company’s efforts to avoid tariffs on China. The company assembled about 55 million iPhones in India last year, up from 36 million a year earlier, people familiar with the matter said, asking not to be named because the numbers aren’t public. Apple makes about 220 million to 230 million iPhones a year globally, with India’s share of the total increasing rapidly. Apple has accelerated its expansion in the world’s most populous country in recent years, bolstered
HEADWINDS: The company said it expects its computer business, as well as consumer electronics and communications segments to see revenue declines due to seasonality Pegatron Corp (和碩) yesterday said it aims to grow its artificial intelligence (AI) server revenue more than 10-fold this year from last year, driven by orders from neocloud solutions clients and large cloud service providers. The electronics manufacturing service provider said AI server revenue growth would be driven primarily by the Nvidia Corp GB300 server platform. Server shipments are expected to increase each quarter this year, with the second half likely to outperform the first half, it said. The AI server market is expected to broaden this year as more inference applications emerge, which would drive demand for system-on-chip, application-specific integrated circuits
PROJECTION: TSMC said it expects strong growth this year, with revenue in US dollars projected to grow by about 30 percent, outperforming the industry Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reported consolidated sales last month reached NT$317.66 billion (US$9.98 billion), the highest ever for the month of February, driven by robust demand for chips built using the company’s advanced 3-nanometer (3nm) process. Last month’s figure was up 22.2 percent from a year earlier, but fell 20.8 percent from January, the world’s largest contract chipmaker said in a statement. For the first two months of the year, TSMC posted cumulative sales of NT$718.91 billion, up 29.9 percent from a year earlier. Analysts attributed the growth to sustained global demand for artificial intelligence (AI) products
RSS