Q3 Taiwan Automotive Industry Further Connects with Mainland Market

According to the new third quarter of 2010 automobile industry overview released by the IEK ITIS of ITRI, Taiwan’s total automobile industry output is estimated at NT$81.3 billion, which represents a growth of 0.8% from the previous quarter and 22.5% from the same period of 2009. The total vehicle production value in the third quarter of 2010 was estimated at NT$38.12 billion, mainly small cars, which accounted for 61.6% of the vehicle output value, followed by passenger and cargo vehicles, which accounted for 19.3% of the total vehicle output value.

Compared with the second quarter of 2010, it is estimated that the total output value of the entire vehicle in the third quarter is flat, and the output value of each vehicle type will have a long growth. Small cars grew by 6.2%, large cars declined by 40.2%, and passenger cars increased by 40.2%. As Taiwan's local SUVs have applied for certification for passenger and cargo vehicles, the two new SUVs, the Luxgen 7 SUV and the Hyundai ix35, which were launched at the end of June, drove the overall sales of passenger cars and cargoes in the third quarter. The big growth.

The export of complete vehicles also has an important contribution to the output value of the entire vehicle. According to the statistics of the Association of Vehicles, a total of 11,462 small passenger vehicles were exported in the third quarter, mainly from Guorui Automobile's export of Corolla Altis under Toyota's regional layout.

In the automotive component market, the output value of the entire vehicle will remain stable. In terms of exports, the U.S. economy will continue to recover slowly. Consumers will begin to replace old parts, and the monthly export amount to the United States will maintain a small growth trend this year. (As shown below). In the Taiwan region where vehicle production and component exports remained stable, the output value of components in the third quarter of 2010 was estimated to have grown slightly by 1.6% from the second quarter to NT$43.18 billion.

Vendor Development and Major Event Analysis Yulong and Dongfeng formed Dongfeng Yulon Motor Co., Ltd. joint venture has been approved by the Central Government of China:

On July 29, 2010, the National Development and Reform Commission of the People's Republic of China formally approved the joint venture between Yulon Continental Investment Co., Ltd. and Dongfeng Motor Corporation to form Dongfeng Yulon Automobile Co., Ltd. The joint venture case base is located in Linjiang Industrial Park, Xiaoshan, Hangzhou. The first phase of the project is to build an annual production capacity of 120,000 passenger vehicles and 120,000 engines.

The new plant products include sports passenger cars, multi-purpose passenger cars, cars and pure electric vehicle products. The first phase of the project's registered capital was RMB 1.55 billion. Dongfeng Motor Corporation and Yulon Continental Investment Co., Ltd. each invested RMB 775 million, each of which holds 50%. Yan Kaitai, chairman of Yulon Enterprise Group, and Xu Ping, chairman of Dongfeng Motor Corporation, signed a joint venture contract in Beijing on September 29.

The passing of this joint venture case was a major milestone for Yulon Group to develop its own brand, which enabled Yulon to break through the long-established model of contract manufacturing and the scale of the Taiwan market. By expanding the market scale, Yulon Investment will share the development costs of the Na Zhijie vehicle models, thereby enhancing the cost competitiveness of the products. With the arrival of Yulonna Zhijie in mainland China, peripheral component manufacturers will also gradually enter the market, driving the development of the upstream component industry.

Future Outlook IEK ITIS analysts pointed out that in the fourth quarter, when the car was replaced by new models, due to the fact that Taiwan’s cars were mostly Japanese cars, it was expected that the appreciation of the Japanese currency would drive up the price of the car and promote the use of the old car models. The sales of new cars in the fourth quarter will have a positive and negative effect. On the other hand, Guorui Automobile’s export of complete vehicles is expected to continue to contribute to the output value of the automotive industry in Taiwan.

The estimated total vehicle output in the fourth quarter was NT$35.3 billion, which was 7.4% lower than the third quarter. In the fourth quarter of 2009, the tide of purchases caused by the reduction of excise tax on goods was driven by the total vehicle production value to NT$42.63 billion, a 17.6% decline from the fourth quarter of 2010. The output value of the components is estimated to be NT$41.47 billion, which is 4% lower than the third quarter. In the fourth quarter, the output value of the entire automotive industry was estimated at NT 76.77 billion yuan, a decline of 11.2% from 2009.

As the overall economic performance is expected to remain stable, it is estimated that the total automobile industry output value in 2010 will reach NT$317.3 billion, which is 21.8% higher than the full year of 2009. The output value of the entire vehicle is NT$149.41 billion. It grew by 26.1% in 2009; the output value of its components was NT$167.9 billion, an increase of 18.3% over 2009.