Earthquake reconstruction will bode well for the heavy-duty vehicle industry as demand for trucks and construction vehicles has increased, industrial players said yesterday.
"Based on the experience of Japan, where the demand for heavy-duty vehicles increased significantly after the country was struck by the 1995 Kobe earthquake, we believe that the market here is expected to repeat this phenomenon and see a boost in demand," said an executive at the Hotai Motor Co Ltd. (
Heavy-duty vehicles are those weighing more than 3.5 tons, with types ranging from buses to carriers of construction machinery.
The increased demand is expected to brighten the outlook for the local heavy-duty vehicle market, which has been gloomy this year because of slack demand, the executive said.
According to Ministry of Transportation and Communications (MOTC), the number of vehicles weighing more than 3.5 tons applying for license plates -- an indicator of new sales -- posted a decline of 10 percent to 7,876 units over the first three quarters of this year compared to the same period a year ago.
The executive predicted that earthquake reconstruction would tremendously boost demand for heavy-duty vehicles beginning this month and extending throughout next year.
However, an executive at the Shung Ye Group (
"We believe that the earthquake reconstruction will indeed increase demands, but it's too early to gauge the full extent of the demand at the present," he said.
In addition, the Shung executive noted that the implementation of quake-related reconstruction works will postpone other giant infrastructure plans, such as high-speed railway project, thus decreasing demand.
He also said any increased demand would not be felt until next year, as there is always a time lag between the implementation of new construction projects and when the effects on the market actually surface.
Shung Ye Group commands a nearly 40 percent share of the local heavy-duty vehicle market. The company is an agent for Mitsubishi's heavy-duty vehicles imported from Japan and vehicles manufactured by Taiwan's China Motors Co (
The Shung Ye executive said slack market demand so far this year has been attributed to delays in many public construction projects and a soft real estate market.
In terms of overall sales during the first nine months of this year, Mitsubishi led with 2,889 units, down 8 percent compared with same period last year. Toyota was second with 2,218 units, down 23 percent. Only Taiwan Isuzu Co (
This year is going to be an eventful one for the heavy-duty vehicle industry. Yulon Motor Co (
Moreover, Shih Shu Yu Chia Automobile Co (
On the other hand, some analysts suspect Mazda and its Taiwan sales agent may retreat from the market because of a lack of new models that comply with new environmental regulations.
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