Taiwan's Hand Tool Industry Suffers Low Season in Q4, 2012
2013/05/09 | By Steve ChuangSupplier group to Chennai, India attract intense interest among local buyers
Taiwan's hand tool industry experienced a low season in the fourth quarter of last year, when output value reached NT$15.18 billion, up 0.4% over a year ago but down 4.3% from a quarter earlier, according to the latest report issued by the Metal Industries Research & Development Center (MIRDC), a local industry researcher.
The report shows that the industry exported NT$13.6 billion of tools in the quarter, down 14.3% quarter on quarter or 10.5% year on year, while importing NT$890 million, sliding 16.8% quarterly or 15% yearly. Meanwhile, domestic market demand totaled NT$2.47 billion, with the import dependency rate of 36%.
Considering that hand tool manufacturing is relatively stable globally and is less affected by economic conditions than high-tech industries, the MIRDC indicated that the industry's downturn in the quarter just reflected global economic doldrums in the year.
Insiders' Moves
To help insiders explore emerging markets, the Taiwan Hand Tool Manufacturers' Association (THTMA) joined hands with Taiwan External Trade Development Council (TAITRA), a semi-official trade promoter, to organize a delegation bound for Chennai, India, an industrial metropolis, to meet local buyers.
According to THTMA, the delegation was led by William Chiang, president of Taiwan's veteran wrench supplier, William Tools Co., and successfully met 75 directors and procurement managers from 45 local enterprises, including such heavyweights as Madras Engineering Industries Private Limited, Aditya Birla Group, Poona Engineering Company, Micro Tooling Systems India Pvt. Ltd. and Robust Precision Measures (P) Ltd.
TAITRA indicated that the delegation achieved big success, showing Indian buyers' intense interest in Taiwan's reputable hand tool industry, with post-meeting business opportunities estimated at US$28.5 million.
While development of hand tools moves forward to lightweight, material-efficient designs, Arrowmax, a U.S.-based hand tool supplier, introduced its trendsetter, Honeycomb series screwdriver, that was shown at the 2013 International Toy Fair Nurnberg, held March 12-18 in Germany, effectively impressing global tool makers with its eye-catching honeycomb design coupled with a light weight handle for easy portability. The tool also features other catchy designs as its dark gray anodized aluminum body, extremely hard and durable tips of spring steel coated with titanium nitride, and the new so-called lexan bottom cover that ensures users more comfortable, controllable and lighter feel. The revolutionary tool is expected to inspire Taiwanese manufacturers to develop their next-generation lightweight tools, according to MIRDC.
Big Events in Q4
The procurement conference, initiated by the Bureau of Foreign Trade under the Ministry of Economic Affairs and organized by TAITRA, aimed to help local suppliers of hardware, hand tools and oil seals to vie for orders from foreign buyers, which rounded off on October 18 and attracted 17 buyers from 12 countries and 78 Taiwanese companies to engage in 144 face-to-face meetings.
Of the invited buyers, heavyweights with annual sales exceeding US$10 million included Premium, a Russian importer of hand tools with annual revenue of over US$600 million and Dong Shin TTM, one of Korea's top three hand tool suppliers. The organizer claimed that the procurement conference helped to materialize business opportunities worth US$20.3 million between foreign and local participants.
The 2012 Taiwan Hardware Show wrapped up on October 13 in Taipei World Trade Center Exhibition Hall 1, and drew 21,636 visitors from 58 countries during its three-day run, representing a 17% growth compared to 18,461 in the last edition. Participation of executives and procuring managers from large international enterprises from Japan, Germany, Brazil, Iran, United Arab Emirates and Czech Republic achieved positive business atmosphere, effectively enhancing nearly 300 exhibitors' confidence in landing orders to propel business growth in the coming year.
A Moderate Year
For Taiwanese hand tool manufacturers, MIRDC said, 2012 was an uncertain year full of negative factors that continued to diminish insiders' confidence, including growth slowdown in China's economy, the nagging debt crisis in the EU bloc and sluggish consumer demand in both Europe and the U.S.
However, the reality is likely to have milder impact than expected, as MIRDC estimates the industry's full-year output value at NT$61.45 billion in the year, slightly down from NT$61.8 billion achieved in 2011, with exports of NT$58.61 billion, down from NT$59.36 billion yearly.
With global economic outlook brightening in 2013, MIRDC projects the industry's output value to reach NT$15.55 billion in the first quarter of the year, totaling NT$62 billion for the whole year, with exports predicted at NT$60 billion. But, the researcher advises that Taiwanese makers to take cautious and rational action in developing business in the year.
Taiwan's Hand Tool Industry Output
Unit: NT$1 billion
| ||||||||
Period
| 2011
| Q3, 2012
| Q4, 2012
| 2012
| 2013
| |||
Value
| YoY Growth
| Value
| Value
| QoQ Growth
| YoY Growth
| Value
| Value
| |
Output
| 61.80
| 5.15%
| 16.38
| 15.18
| -4.3%
| 0.4%
| 61.45
| 62.0
|
Imports
| 4.76
| 4.20%
| 1.06
| 0.89
| -16.8%
| -15.0%
| 4.01
| 4.5
|
Exports
| 59.36
| 9.97%
| 15.74
| 13.60
| -14.3%
| -10.5%
| 58.61
| 60.0
|