Operating conditions for Taiwanese manufacturers fell last month amid lingering economic weakness in the US, Europe and China, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday.
The official manufacturing purchasing managers’ index (PMI) shed 4.4 points to 49.2, dropping back into contraction territory, as companies turned from cautious to conservative regarding their business prospects, CIER president Lien Hsien-ming (連賢明) said.
“The subindices on new business orders, industrial production and business outlook all declined into the contraction zone, which could suggest a turning point,” Lien said.
Photo: Ritchie B. Tongo, EPA-EFE
PMI data aim to measure the health of the manufacturing industry. Values of 50 or higher indicating expansion, while values below the threshold suggest contraction.
The sentiment shift had to do with the market’s lack of enthusiasm over global sales of iPhone 16s and a stall in demand for electronics used in artificial intelligence (AI) applications, Lien said.
That explained why the critical subindex on new orders lost 8.2 points to 48.5, while the measure on industrial output tumbled 10.6 points to 46.8, the institute said in its monthly survey.
New export orders sank 8.2 points to 44.6, while unfinished orders dropped 5.9 points to 43.5, the survey showed.
PMI readings already pointed to a slowdown in the US, Europe and China, Lien said, adding that oil exporters last month trimmed their sales forecasts.
CIER researcher Chen Shin-hui (陳馨蕙) said that the absence of a growth catalyst accounted for the lackluster showings, despite the onset of the high season for technology products.
The reading on the six-month business outlook shrank 5.3 points to 47.5, putting an end to seven months of optimism, the survey showed.
CIER vice president Wang Jiann-chyuan (王健全) said that AI is in a bit of a bubble, which would be seen in last month’s shipments.
A Chinese ban on Nvidia Corp chips also would affect local firms in its supply chain, Lien said.
Taiwanese firms would need more time to judge whether rate cuts by the US Federal Reserve and stimulus measures in China would shore up the world’s two largest economies, he said.
Taiwan’s non-manufacturing sectors also experienced a slowdown, but remained at healthy levels, CIER said in a separate survey, as the non-manufacturing index lost 1.2 points to 53.3.
The PMI slowdown weighed on shipping rates and new credit controls by Taiwan’s central bank dampened buying interest at home, CIER said.
However, most service providers are positive about their business going forward, keeping the reading on the six-month outlook at 53.1, it said.
Shares of contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) came under pressure yesterday after a report that Apple Inc is looking to shift some orders from the Taiwanese company to Intel Corp. TSMC shares fell NT$55, or 2.4 percent, to close at NT$2,235 on the local main board, Taiwan Stock Exchange data showed. Despite the losses, TSMC is expected to continue to benefit from sound fundamentals, as it maintains a lead over its peers in high-end process development, analysts said. “The selling was a knee-jerk reaction to an Intel-Apple report over the weekend,” Mega International Investment Services Corp (兆豐國際投顧) analyst Alex Huang
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is expected to remain Apple Inc’s primary chip manufacturing partner despite reports that Apple could shift some orders to Intel Corp, industry experts said yesterday. The comments came after The Wall Street Journal reported on Friday that Apple and Intel had reached a preliminary agreement following more than a year of negotiations for Intel to manufacture some chips for Apple devices. Taiwan Institute of Economic Research (台灣經濟研究院) economist Arisa Liu (劉佩真) said TSMC’s advanced packaging technologies, including integrated fan-out and chip-on-wafer-on-substrate, remain critical to the performance of Apple’s A-series and M-series chips. She said Intel and Samsung
POWER BUILDUP: Powered by Nvidia’s B200 Blackwell chips, the data center would support MediaTek’s computing power demand and business growth, the company said Smartphone chip designer MediaTek Inc (聯發科) yesterday launched a new artificial intelligence (AI) data center with a maximum capacity of 45 megawatts to meet its rising demand for computing power required to develop new advanced chips for AI applications. The company has completed the first-phase computing power buildup at the data center in Miaoli County’s Tongluo Township (銅鑼), providing 15 megawatts of capacity to support its research and development (R&D) capabilities, despite an industrywide shortage of key components, MediaTek said. Supply constraints have plagued a wide range of key components, including memory chips, solid-state drives, power supply units and central
TRANSITION: With the closure, the company would reorganize its Taiwanese unit to a sales and service-focused model, Bridgestone said Bridgestone Corp yesterday announced it would cease manufacturing operations at its tire plant in Hsinchu County’s Hukou Township (湖口), affecting more than 500 workers. Bridgestone Taiwan Co (台灣普利司通) said in a statement that the decision was based on the Tokyo-based tire maker’s adjustments to its global operational strategy and long-term market development considerations. The Taiwanese unit would be reorganized as part of the closure, effective yesterday, and all related production activities would be concluded, the statement said. Under the plan, Bridgestone would continue to deepen its presence in the Taiwanese market, while transitioning to a sales and service-focused business model, it added. The Hsinchu
RSS