New vehicle sales in Taiwan plunged 23 percent year-on-year to 31,910 units last month, and dropping by about 3 percent from the previous month, as car buyers stayed on the sideline awaiting potential tariff cuts on US imported vehicles, government data showed yesterday.
That brought cumulative new car sales for the first five months of the year to 164,647 units, down 13.8 percent year-on-year, compared with an 11.2 percent decline over the January to April period, the data showed.
“The US’ ‘reciprocal’ tariff policy has weighed on Taiwan’s new car sales,” auto research firm U-CAR said in a report.
Photo: Amy Yang, Taipei Times
“Although it is too early to predict the outcome of Taiwan-US trade negotiations, speculation that [Taiwan might] reduce vehicle import tariffs and commodity taxes is prompting potential car buyers to stay on the sidelines,” it added.
Taiwan imposes combined duties of up to 52.5 percent on imported vehicles, including a 17.5 percent import duty, a commodity tax of 25 to 30 percent and a 5 percent business tax, according to Ministry of Finance data.
Any adjustments to these levies could lead carmakers and distributors to reduce retail prices, potentially encouraging consumers to buy a new car.
Last month’s sales slump defied the usual seasonal pattern, as May typically sees a surge in promotional efforts by carmakers and distributors to boost mid-year sales, the researcher said.
Hotai Motor Co (和泰汽車), a local distributor of Toyota and Lexus, maintained its market lead with a 36.3 percent share by selling 11,592 units.
However, its sales declined 10.8 percent year-on-year and 7 percent from the previous month.
With sales promotion activities set to extend into this month, new vehicle sales this month are expected to pick up to about 330,000 units, an industry insider said yesterday.
Imported vehicles were less affected by last month’s tariff-related uncertainty, with sales edging up 0.3 percent sequentially to 16,223 units, although still down 22.6 percent year-on-year.
That modest boost helped increase the market share of imported cars to 50.8 percent, after hovering at less than 50 percent for the past few months, statistics showed.
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