Mazda Will Import Auto Parts from China for Assembly in Taiwan

Taipei, Sept. 13, 2011 (CENS)--Thanks to the effect of cross-Taiwan Strait Economic Cooperation Framework Agreement (ECFA), Mazda has decided to import auto components and parts from mainland China for assembly of its CX5 recreational vehicles in Taiwan.

The move underscores the trend that more international auto brands may enhance their deployment in Taiwan by taking advantage of the division of labor across Taiwan Strait. The trend may help local auto-parts firms, such as Tong Yang and Ta Yih, garner more orders from international brands. In addition, auto assemblers in Taiwan, such as Ford and Yulon, will be able to cut their production cost by using lower-cost components and parts imported from mainland China.

At present, in addition to imported finished cars, Mazda also outsources auto assembly to Ford Taiwan, which uses components and parts imported from Japan. It could not use components and parts made by Mazda factories in mainland China, due to tariff barrier.

However, since auto parts have been included in the early-harvest list of ECFA, or priority items for tariff cuts or market opening. Therefore, import of auto parts from mainland China for assembly in Taiwan can greatly cut production cost.

Chu Mei-chun, chief executive officer of Mazda Taiwan, pointed out that the company will introduce newly remodeled Mazda CX5 for assembly in Taiwan, which will hit the market in November. The company aims to move 600 units of the car in Taiwan a year, up from the original target of 300-350, with market share rising to 24%, up from 14% originally.