Hotai Motor, Taiwan’s dominant automotive distributor, expects the island’s new vehicle market to stabilize at 450,000 units this year, unchanged from its March forecast, even as the company monitors growing uncertainties around trade policies and monetary conditions.
The company, which distributes Toyota, Lexus and Hino models and has maintained market leadership for 23 consecutive years, is sticking to its sales target of 165,000 vehicles for 2025, aiming for a 36.7% market share. The breakdown includes 130,000 Toyota units, 28,500 Lexus vehicles, and 6,350 Hino commercial vehicles.
Taiwan’s automotive market showed resilience in 2024, with new vehicle sales totaling 457,830 units, though this represented a decline from the previous year’s peak. The market had reached 478,137 sales in 2023, an 11.4% increase, following post-pandemic recovery.
Speaking at an investor briefing, Hotai spokesman Lai Chih-wei identified four key variables that could affect market performance: unclear central bank monetary policies globally, evolving geopolitical dynamics, potential changes to Taiwan’s vehicle replacement incentives, and varying promotional strategies across brands.
The company’s cautious optimism comes despite broader economic headwinds. Taiwan’s automotive market experienced a five-month negative streak through June 2024 before recovering in the second half.
Currency fluctuations present another challenge, though Hotai says its hedging strategies aligned with Toyota’s global pricing model minimize short-term exchange rate impacts. The company prices imports in US dollars rather than Japanese yen, providing some insulation from volatility.
Looking ahead, potential changes to import tariffs and commodity taxes could reshape consumer demand patterns. Hotai maintains it can adapt quickly through its dual approach of both locally-produced and imported vehicles, leveraging its partnership with domestic manufacturer Kuozui Motors alongside direct imports from Japan.
The company’s inventory levels and delivery schedules remain “relatively healthy,” according to management, though they acknowledge heightened uncertainty in the operating environment requires continuous monitoring of both timing and stock levels.
