TAIPEI (Taiwan News) — Taiwan’s machine tool industry is facing pressure on second-half shipments as manufacturers continue to grapple with supply chain disruptions despite improving order conditions, CTEE reported Monday.
The Taiwan Machine Tool and Accessory Builders’ Association said orders from semiconductor and technology companies have remained steady, helping support a recovery in bookings. Despite improving orders, a strong pipeline has not translated into immediate shipments as manufacturers struggle with component shortages, higher costs, and labor competition.
Several major domestic machine tool makers, including Victor Taichung Machinery Works Co., Fair Friend Group, and Yeong Chin Machinery Industries Co., said their order visibility extends through at least the third quarter or the end of the year. Other suppliers, including Honor Seiki Co. and Shieh Yih Machinery Industry Co., have secured orders into the first half of next year.
However, strong order visibility has not eased near-term delivery constraints. Roundtop Machinery Industries Co. said it has received orders extending into the first quarter of next year, but shortages of controllers supplied by a major Japanese manufacturer have delayed deliveries of completed equipment.
Fair Friend said its Taiwan operations currently have more than three months of orders on hand. To reduce the impact of extended lead times for critical components such as controllers, ball screws, and linear guides, the company prepared additional inventories in April and May.
Manufacturers have also been affected by rising ocean freight costs to Europe due to geopolitical conflicts in the Middle East. The increase in shipping expenses, combined with a slow recovery in the European market and the summer holiday season in July and August, has led some overseas customers to postpone purchases.
Industry representatives warned that continued geopolitical uncertainty has increased volatility in raw material prices, including steel, copper, and petrochemical products, while making delivery schedules more difficult to forecast. Prolonged conflicts could further strain component supplies.
Labor shortages remain another challenge, with semiconductor and electronics companies’ higher salaries intensifying competition for skilled workers. Staffing constraints could eventually limit production capacity and affect fourth-quarter shipments.
