Improved Economy And Tax Cuts Fuel Autos Growth

After a 30% year-on-year (y-o-y) fall in new car registrations to 229,495 units in 2008, in January 2009 the Taiwanese legislature approved a reduction in commodity tax by TWD30,000 (US$909) on both locally produced and imported cars (with engine sizes of less than 2000cc) and TWD4,000 (US$121) on powered two-wheelers. The tax cuts are applicable all through 2009, and were aimed at encouraging the sale of new cars and motorbikes. New licenses issued on January 19 and 20 increased by almost 6,000, which stood in contrast to the first 10 days of the month, when registrations were down by nearly 50% compared with the year before. Vehicle sales for the whole of January therefore bucked the global trend -- and in some style, rising by 25.9% month-on-month (m-o-m). This came in a context where some countries around the world were recording drops in car sales of 40% y-o-y in the first couple of months of 2009.

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