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Key Industries

智慧機械

  • 日期:2021-10-07
智慧機械

 

Source: Industrial Development Bureau, MOEA

Last Updated on: 2020.9.30

I. Policy Initiatives

In response to the massive changes brought about by the IoT, 3D printing, AI, and robot technologies to life and industries, Taiwan implemented the “Smart Machinery Industry Promotion Program” in July 2016. The measures for this program are as follows:

1. Smart Machinery Promotion Office

This office is established to create a new ecosystem for Taiwan's smart machinery industry. The aim is to develop various solutions based on Taiwan's precision machinery and ICT industries, to help key industries applying smart manufacturing.

2. Smart Manufacturing Technology Test Site

This site is a national proofing center that equipped with 100% domestically produced high-end machinery processing equipment. The site links together digital product systems that are domestically developed and produced, develops machinery processing application service modules, and realized 9 mixed-model smart manufacturing production lines for parts and components. It serves as the domestic smart manufacturing planning center, and shows the capability of domestic equipment in Industry 4.0 applications to the industry.  

3. Smart Machinery Park

In coordination with industry characteristics, requirements, and location of industrial clusters, Taichung City Government has expanded the hinterland of Taichung Fengzhou Technology Science-based Industrial Park to a “ Smart Machinery Park” for the companies to build factories and test sites.  

 

II. Overview of Industrial Development

1. Output Value

In 2017, the machinery industry became Taiwan's third largest industry in terms of output value, after the semiconductor and panel industries. The output value of Taiwan's machinery industry was NT$1.18 trillion in 2018. However, the intensification of the trade disputes between the United States and China and the significant decrease the demand for industrial machinery caused the output value in 2019 to decline by 6.8% from 2018 to NT$1.1 trillion.

 

Figure 1   Output value of Taiwan's machinery industry in 2016-2019

 

2. Industrial Clusters

According to statistics of the Statistics Department, Ministry of Economic Affairs (MOEA), Taiwan currently has approx. 18,000 machinery companies with over 300,000 employees. Industrial clusters have formed in northern, central, and southern Taiwan, which lead to the establishment of many important companies.

(1)Northern Taiwan

The northern Taiwan industrial cluster is formed in New Taipei City, Taoyuan, and Hsinchu, consists of precision sensing equipment, electronics and semiconductor production equipment, automated components and system integration, industrial computers, and controllers, in which “Fair Friend Group”(FFG) headquartered in Taipei, “Delta Electronics”(DELTA) and “Advantech” are the most representative.

(2)Central Taiwan

An industrial cluster of machine tools and parts and components, integrated ball screw, linear guide, industrial machinery (carpentry, textiles, rubber and plastics machinery), smart robots, automation components and system integration are located in Taichung and Changhua. The representative companies include “HIWIN”, “Precision Motion Industries” and “ Gallant Precision Machining Co., Ltd.”.

(3)Southern Taiwan

As for Chiayi, Tainan, and Kaohsiung, there are industrial clusters for machine tools and parts and components, industrial machinery (screw forming and processing and rubber and plastic machinery), semiconductor equipment, smart robots, controllers, and precision molds, in which "Tongtai Machine & Tool", "CCM", and "E&R Engineering Corp." are the most representative.

Figure 2  Taiwan's Precision Machinery Industrial Clusters

 

 III. Investment Opportunities

1. Joint development of smart manufacturing applications

Taiwan has developed complete industrial clusters for the semiconductor, ICT, metal processing, the auto parts and components, and petrochemical products. The tightly knit machinery industry supply chains alone with the government's active promotion of industrial parks and preferential taxes, foreign companies will have the optimal site for developing and verifying innovative smart manufacturing application projects.

2. Transformation of R&D results through supply chain collaboration

(1)Taiwan is the world's seventh largest producer and fifth largest exporter of machine tools. Taiwan has complete industrial clusters and supply chains, and has all of the equipment or systems for machine tools, robotic arms/robots, smart factories, and industrial IoT.

(2)Taiwan's machinery industry has detailed division of labor with the flexibility to meet customers' requirements. The abovementioned industrial foundation will benefit foreign companies in establishing R&D or production sites in Taiwan.

3. Exploration of the continuously growing smart manufacturing market

Industry 4.0 has become a global trend. The trade war between the United States and China has also compelled companies to readjust production capacity plans and the supply chains that were previously concentrated in a handful of production sites have gradually become more regional and dispersed. This trend is expected to encourage manufacturers in all areas to increase vertical integration, automation, and demand for smart machinery applications such as robotics. The COVID-19 epidemic has also increased the demand for service robots in the cleaning and healthcare sectors. Foreign companies can seize business opportunities of Taiwan's smart machinery industry through investment in Taiwan, and further expand into the future regional/global market.

IV. Investment Incentive Measures

1. Tax incentives

(1) Taiwan’s profit-seeking enterprise income tax rate is 20%

(2) Up to 15% of the company’s R&D expenditures may be deducted from its profit-seeking enterprise income tax for current year.

(3) Royalty payments to foreign companies for imported new production technologies or products that use patents, copyrights, or other special rights owned by foreign companies is, with the approval of the Industrial Development Bureau, MOEA, exempt from the corporate income tax.

(4) Imported machinery which local manufacturers cannot produce are eligible for duty-free treatment.

2. Subsidies

(1) The Global R&D Innovation Partner Program

Some foreign companies have a high degree of complementarity with Taiwan's industries. To encourage them to engage in R&D and innovation activities in Taiwan, such companies, after gaining approval from the MOEA, will be eligible for subsidies of up to 50% of total R&D expenditures if they: a. have technologies that are not yet mature in Taiwan or overseas, and could create strategic products, services, or industries over the course of future industrial development; b. have potential to help Taiwan produce leading technologies or significantly enhance the competitiveness and increase the added value of important industries; or c. engage in key and common technology R&D, vertical or horizontal technology integration, and can create an industrial value chain.

(2) Integrated R&D Program

Companies, once approved by the MOEA, will be eligible for subsidies of no less than 40% but no more than 50% of total project funding if they: a. engage in key and common technology R&D, vertical or horizontal technology integration, and can create an industrial value chain; b. establish industry standards, protocols, or platforms; or c. establish applications, services, and innovative business and marketing models with technological content, and increase industry's added value.

(3) Taiwan Industry Innovation Platform Program

The MOEA Industrial Development Bureau and the Ministry of Science and Technology are jointly implementing the "Taiwan Industry Innovation Platform Program" to guide industries to develop towards greater value, and to encourage companies to enter high-end product application markets to increase industry's overall added value. For companies owning R&D teams in Taiwan, the program provides 40-50% of the funding required for theme-based R&D projects, and up to 40% of funding for R&D projects proposed by the companies themselves.

 

V. Major Foreign Investors in Taiwan

1. Collaboration in machinery and equipment manufacturing

Applied Materials invested in a manufacturing center of the equipment for producing display in Taiwan. Yaskawa Electric Corporation invested in a robot R&D and exhibition center in Taiwan.

2. Cross-industry collaboration

Keysight Technologies, a leading test and measurement equipment provider from the United States, and MediaTek, a semiconductor plant in Taiwan, announced their technology cooperation partnership for business opportunities in the future 5G market in 2020.

3. Cooperation on the testing sites

Dassault Systèmes established an R&D center in Taiwan and formed an alliance with the Fair Friend Group to seize business opportunities of smart factories. It also signed MOUs with Taoyuan and Taichung City Governments to collaborate in projects relating to IoT, startup ecosystem, and innovation and R&D hubs under the "Asia Silicon Valley" program.

4. Cooperation on talent development

Bosch and National Cheng Kung University jointly established a smart manufacturing innovation facility to cultivate Industry 4.0 talents.

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