November 25, 2009

Reunification Watch: Chinese Carmakers to Revive Taiwan Auto Industry

Auto associations from China and Taiwan met in Taipei this week and agreed to cooperate in enhancing Taiwan's lagging auto industry. Private automaker Chery Automobile is already producing its A3 sedan in Taiwan and plans to introduce the larger A5 and A6 soon. Chery wants to work with Taiwan carmaker Auto21 according to reports. Yulon Motor, one of Taiwan's top automakers, signed an agreement this month with Geely Automotive to develop an economy car next year.

Taiwan's auto industry is dominated by a few firms, including Yulon, that are all part owned by Japanese auto majors including a tie-up with Ford/Mazda. While Taiwan carmakers excel at parts production the domestic industry suffers from declining sales and a saturated domestic market. The Chinese joint ventures will be aimed at exporting back to the mainland and also exporting from Taiwan to foreign markets.....

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