Taiwan Suppliers Look Around the World for Solutions

Tariffs are forcing Taiwanese companies to rethink their plans, but it could be worse.

June 1, 2025

Sebastian Blanco

Speaking at the 360 Mobility shows in Taipei in late April, the chairman of the Taiwan External Trade Development Council (TAITRA), James Huang, put a positive spin on the chaos that new tariffs – which at the time of writing were 25% for automobiles and auto parts – are putting on the many auto parts suppliers.

TAITRA chairman James Huang speaks at the start of the 360 Mobility shows in Taipei. (Sebastian Blanco)

“It’s business as usual. No big deal,” Huang said when asked what his message was for the companies at the show. “This 25% tariff is across the board, not just for Taiwan. Our competitors, they also get a tariff of 25%.”

When pressed, Huang said that of course companies are preparing for the unknown. Until the U.S. started the tariff trade war, 50% of all auto parts made in Taiwan went to the U.S., Huang said, but the new reality is that Taiwanese companies now need to explore business opportunities in other major markets like the EU, Southeast Asia, South America, the Middle East and Africa and Japan.

“There will be impacts on short-term businesses, that’s for sure, but speed and flexibility are what make Taiwanese companies competitive,” Huang told SAE Media. “They will look for opportunities anywhere, not just in Taiwan. If they need to diversify their manufacturing, they will. They will go to Africa, go to Southeast Asia, and go to the United States when the situation requires.”

Some Taiwanese suppliers are more prepared than others, Huang said, and more might move their operations to the United States in the coming years.

“Our auto parts industries have already diversified their portfolio,” he said. “In terms of the U.S. market, it’s still the most important market for Taiwanese auto parts companies, but in recent years, some of them have already started manufacturing in the United States and some went to Mexico. One of our companies that manufactures LED headlights 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.“

Huang said Taiwanese companies have worked for fifty years setting up shop in a country with few natural resources and 23 million people.

Two shows – Taipei AMPA and E-mobility Taiwan – were part of the 360 Mobility event in April. (Sebastian Blanco)

“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’s optimism was best seen in his statement that full-fledged automotive manufacturing could come to Taiwan, which until now has focused on supplying components.

“We missed the opportunity to become an automaking country in terms of ICE, the internal combustion engine,” he said. “We are not good at that. We are good at auto parts and electronics, but in terms of EVs, I think we have a chance.”

The most obvious choice, he said, would be the Taiwanese multinational electronics contract manufacturer Foxconn, which Huang said is looking for partnerships to build EVs including potentially acquiring or otherwise working with Nissan.

“[Foxconn has] a joint venture with the largest Thailand telecom company to produce EVs there, and they have a joint venture with Saudi’s sovereign wealth fund and they are talking to Nissan. Foxconn is very aggressive in looking for partnerships so that they can expand their EV production globally, not just for Taiwan.”