Auto market demand remains strong in Taiwan

The Central News Agency (Taipei) - Demand in Taiwan's automobile market remains strong and will face a bigger shortage if Japanese suppliers cannot resume full production, market specialists said Monday.

In the first three months of this year, 106,191 cars were sold in the country, representing an annual growth of 58.4 percent.

Analysts partly attributed the growth to demand for new cars delayed by the financial crisis of the past two years.

A proposed new tax on high-end goods and services also helped drive up growth, the analysts said.

In March alone, there were 9,411 imported or high-end vehicles sold, an annual increase of 70.3 percent and a monthly rise of 133.3 percent.

Another wave of demand for high-end cars will likely be seen in the period prior to the government levying the luxury tax in the second half of this year, said Beldare Motors Ltd., a subsidiary of Taikoo Motors Ltd. and the local Volkswagen dealer.

If the shortage of high-end Japanese cars continues, buyers are likely to choose European ones instead, the company predicted.

The March 11 earthquake in Japan has disrupted the production lines of Toyota, Nissan and Honda, affecting their ability to supply the Taiwanese market.

Taiwanese manufacturers for Japanese cars said their parts inventories will last until April, but they expressed concern over power shortages and rolling blackouts in Japan that have impacted the resumption of production lines there.

"Taiwan's car market demand is still strong and the current uncertainty is how fast Japanese car makers can speed up the resumption of their production lines, " said Hsieh Fu-lai, a spokesman for Hotai Motor Co., Taiwan's largest car retailer and the local dealer for Toyota and Lexus.

"If there is any delay in the resumption, it could mean a shortfall of more than 10,000 Japanese cars in Taiwan, " he added.

Hotai reported a shortfall of 2,300 cars in March, as Toyota's assembly factories had suspended production due to the power supply problems.