Taiwan's automotive industry stands resilient amid US tariff pressures, Stephen White (the 18th) reports from the AMPA show in Taipei.

Taiwan's automotive industry has long been recognised as an essential component of the global supply chain, especially notable for its advanced electronics and auto parts manufacturing. However, the sector currently faces significant challenges due to recent US trade policy shifts, notably the imposition of a 25 percent tariff on auto parts imported from Taiwan.

Speaking at the Taipei AMPA 2025 automotive show, James C. F. Huang, Chairman of the Taiwan External Trade Development Council (TAITRA), Huang acknowledged that the US remains Taiwan’s most significant automotive export market, with approximately 50% of all Taiwanese auto parts shipped to the US last year. He described the tariff situation as "fluid," stating, "The situation is a little bit fluid because we are not certain about our policies. I know for automobiles and auto parts it is a 25 percent tariff."

He emphasised that while these tariffs create immediate pressures, Taiwanese companies have proactively diversified their manufacturing strategies and locations in response.

"Our auto parts industries have already diversified their portfolios," Huang explained, adding that several companies have established manufacturing operations directly within the United States or in Mexico, capitalising on the USMCA trade agreement.

Highlighting this trend, Huang, who served as the Taiwanese minister for foreign affairs between 2006 and 2008, provided a specific example: "One of the companies, they manufacture LED headlights. They were invited by the big three to go to Michigan and set up their manufacturing plant there two years ago. So it's already happening."

He further noted the tariff situation would accelerate such relocations, stating, "Definitely it will, because of the tariff."

Despite these adjustments, Huang strongly emphasised a business-as-usual approach. When asked about his advice to Taiwanese exhibitors amid tariff concerns, Huang confidently stated: "Business as usual. No big deal." He described Taiwanese businesses as resilient and adaptable, saying, "Our business people are very brave. So this is a country with practically no natural resources, with 23 million people here. If you look at what we have gone through in the past five decades, I'm quite confident in the resilience of our companies. I think they can weather the storm and they will survive, no problem."

Huang also addressed the broader importance of other international markets in response to the barriers posed by US tariffs. He underscored the increased significance of regions such as the EU, Southeast Asia, Japan, South America, and particularly the Middle East. Regarding the Middle East, Huang highlighted Egypt and Saudi Arabia as strategic gateways: "I visited Egypt twice in the past couple of years. Quite a few European OEMs set up their manufacturing in Egypt. We are looking at parts manufacturing; we are quite competitive."

Additionally, he referenced Foxconn's joint venture with Saudi Arabia's PIF sovereign fund, aimed at producing electric vehicles (EVs), stating, "Foxconn has a joint venture with Saudi’s sovereign fund in producing electric vehicles for the Middle East and with a greater scope covering Egypt and Africa."

"The future will be built on collaboration if we are going to take mobility forwards."

On the prospects of Taiwan becoming an automotive manufacturing hub beyond just parts, Huang candidly acknowledged a missed opportunity with traditional internal combustion engine vehicles, stating, "We missed the opportunity to become an automaking country in terms of ICE, right? Internal combustion engines. We are not good at that. We are good at auto parts and electronics."

However, he expressed optimism regarding Taiwan’s future in EV manufacturing, led primarily by Foxconn. "In terms of EV, I think we have a chance," he said, highlighting Foxconn’s aggressive expansion into international markets through strategic partnerships, including potential alliances with global automotive brands like Nissan. Huang explained, "Foxconn is very aggressive in looking for partnerships so that they can expand their EV production globally, not just for Taiwan." 

The tone of optimism and adaptability was echoed by Cynthia Kiang, Deputy Minister at Taiwan’s Ministry of Economic Affairs, who highlighted the country’s industrial scale and flexibility. "Taiwan really has a competitive edge because we have a very good ICT and semiconductor industry here," she said, explaining how AI adoption in cars has given Taiwan a crucial role in the smart mobility value chain. "We have very flexible manufacturing capability and also a comprehensive supply chain here, making Taiwan a very important partner for the global smart mobility supply chain."

Kiang detailed the sector’s impressive economic footprint. "Last year, the total value of auto and motorcycle parts in our country reached $346.1 billion NT dollars, of which nearly $300 billion NT dollars were exports," she said. Combined with domestic vehicle production and electronics, the sector is worth over NT$1 trillion annually.

To further support the industry, Taiwan’s legislature recently passed amendments to the Statute for Industrial Innovation, introducing tax incentives for AI integration, carbon reduction, and R&D investment. Kiang added, "We are reducing financial pressure on industry members to invest in innovative applications."

Taiwan’s Executive Yuan administration has rolled out a NT$41 billion support package to counter global disruptions. Measures include increased export loan guarantees, targeted subsidies, and support for SME internationalisation. Kiang pointed to the Taiwan Select Networking Conference, where over 450 global buyers were hosted, with follow-up factory tours showcasing Taiwan’s strengths in machinery, hand tools, and auto parts.

James Huang’s keynote also framed mobility within a broader, visionary narrative. "Mobility didn’t begin with engines or electricity. It began when early humans stood up and walked," he said, as he painted a picture of a world where cities respond to vehicles, AI personalises travel, and transport becomes a sustainable part of the energy grid.

"Mobility is not just about where we go," Huang stated. "It’s about how we live and how we move forward together." He introduced the new 360 Mobility Mega Show, which unites Taipei AMPA and 235 Immobility, calling it "a platform for the entire ecosystem, from EVs and smart cars to autonomous driving and future ideas."

Echoing this emphasis on international collaboration, Erich Kuss, Deputy Director of the American Institute in Taiwan, described Taiwan as a "global leader in advancing the automotive industry." He underlined the role of Taiwanese firms in driving innovation in AI, components, and electrification. "Together, we can leverage AI and autonomy to create smarter, more efficient vehicles," Kuss said.

Highlighting US investments such as TSMC in Arizona and HOTA in New Mexico, Kuss said the US was committed to revitalising its automotive industry and welcomed Taiwanese partnerships. "We see tremendous opportunity for Taiwanese companies to partner with us in this growth," he said, encouraging further participation at the SelectUSA Investment Summit.

Looking beyond the US, Huang and Kiang emphasised Taiwan’s growing engagement in regions like the EU, Southeast Asia, and the Middle East. Huang pointed to Egypt and Saudi Arabia as new industrial hubs, citing Foxconn’s joint venture with Saudi Arabia’s PIF to produce EVs for the region. "Foxconn is very aggressive in looking for partnerships," he said, noting interest from global OEMs like Nissan.

While Huang admitted that Taiwan "missed the opportunity to become an automaking country" with internal combustion engines, he was bullish on its EV potential. "In terms of EV, I think we have a chance," he said. "We are not just building vehicles. We are helping change the future."

Despite geopolitical tensions and market uncertainty, the message from Taiwan’s leadership is clear: through diversification, innovation, and collaboration, the island is shaping a smarter, more sustainable mobility future.

"Let us move forward together," Huang added. “From bare feet to wheels and wings, every step has taken us further, faster, and with more imagination. Because mobility is more than just a tool. It's progress, it's connection, and it's how we grow. And now, a new chapter begins. Self-driving taxis are here. Flying cars are taking off.

“The dream of advanced air mobility is becoming real. And as automotive science advances, we are not just crossing countries. We are reaching beyond Earth. This is science fiction. This is the world we are building. Connected, intelligent, and fast. The future won't live only on roads and rails. Every journey is shaped by smart design, clean energy, and better thinking. AI is now driving mobility forward from simple roads to smarter roads. It's making every system more responsive, more personal, and more human.

“And as the world focuses on climate and clean energy, mobility is stepping up. Electric, efficient, sustainable by design. Energy infrastructure is evolving too. Vehicles are becoming part of the grid, charging, storing, and shaping power whenever it's needed. But progress also needs trust. And vehicles connect and collect data. We must protect it clearly, carefully, and always with people in mind.

AMPA arrived this year alongside with two other events, E-Mobility Taiwan and Autotronics Taipei. Collectively they have been called the 360^o Mobility Show. The connected shows, are intended to better show off the advances the Taiwanese auto-industry is making. 

“Mobility is not just about where we go, it's about how we live and how we move forward together,” said Huang. “That's why we created the 360 degree mobility mega-show. By uniting Taipei AMPA, E-Mobility Taiwan and Autotronics, we built a platform for the entire ecosystem, from EVs and smart cars to autonomous driving and future ideas. This is a full-structured look at tomorrow. This show grows as the industry grows. It reflects not just how we move, but why we must move better. Around the world, the future of mobility is built on collaboration.”

Taiwan is playing its part and a leader in semiconductors, smart manufacturing, and system integration. The country is not just building vehicles, it is helping change the future, said Huang.

“We are ready to move with the world, not just faster, but wider. So to all our competitors, your innovations are the heartbeat of this show. To all our visitors, your curiosity and engagement fuel the momentum of progress. And to all of you, our partners, supporters, and industry leaders, thank you for being part of this remarkable journey. Today, we don't just open an exhibition, we open a conversation, a shared journey toward a smarter, more sustainable world. Let us imagine important. Let us move wisely. And above all, let us a shared journey toward a smarter, more sustainable world. Let us imagine important. Let us move wisely. And above all, let us move forward together.”