Taiwanese Manufacturers Face Turbulence Amid New U.S. Tariffs

Taipei: Taiwanese textile and furniture companies with significant production bases in Southeast Asia are expressing concerns about navigating the risks posed by the latest round of tariffs imposed by the United States. According to Focus Taiwan, Eclat Textile Co., a Taiwanese supplier to major international sportswear brands such as Nike, Lululemon, and Under Armour, revealed that 60 percent of its garment sales are derived from the U.S. market. In a recent interview, Eclat disclosed that 60 percent of its total production takes place in Vietnam, 27 percent in Indonesia, and 10 percent in Cambodia, highlighting the increasing risks they now face. U.S. President Donald Trump announced reciprocal tariffs on countries worldwide, with rates ranging from 10 percent to more than 40 percent, effective April 9. The tariffs list includes a 32 percent tariff on Taiwan, 34 percent on China, 49 percent on Cambodia, 46 percent on Vietnam, 36 percent on Thailand, and 32 percent on Indonesia. Eclat emphasized that despi te its diversified production bases, it cannot avoid the impact of the new tariffs. The company plans to collaborate closely with suppliers to enhance production efficiency and control costs while establishing strategic partnerships with clients to mitigate the effects of Trump's policies. While some Taiwanese companies are contemplating investments in the U.S. market to circumvent the tariffs, Eclat indicated that expanding production to the U.S. remains challenging due to high labor costs and a shortage of suppliers in the textile industry. Meanwhile, Makalot Industrial Co., a manufacturer of garments including pants, underwear, and sleepwear, also expressed apprehension about the financial impact of the tariffs. The U.S. constitutes over 70 percent of Makalot's total sales revenue, with 41 percent of its production in Indonesia, 37 percent in Vietnam, and 14 percent in Cambodia. Makalot announced plans to hold international meetings next week and engage with clients to explore ways to share the anticipa ted financial burden resulting from the tariffs. Pou Chen Corp., a leading Taiwanese footwear manufacturer and contract supplier to international brands like Nike, Adidas, and New Balance, is also preparing to consult with clients to devise a response to the tariffs. Market estimates suggest that Pou Chen has 53 percent of its production in Indonesia and more than 30 percent in Vietnam. Beyond textile companies, other Taiwanese firms, including furniture manufacturers Shane Global Holding Inc. and Nien Made Enterprise Co., are also bracing for the impact. Shane Global has 64 percent of its production in China and Cambodia, while Nien Made has 80 percent in those countries, according to market estimates. Furthermore, several Taiwanese tech companies with substantial production lines in Southeast Asia are also affected by the U.S. tariffs. Taiwan's National Development Council (NDC) announced on Friday that it would offer assistance to Taiwanese manufacturers in Southeast Asia interested in returning to Tai wan. NDC head Liu Chin-ching stated that the government aims to optimize Taiwan's investment environment to enhance the global competitive edge of Taiwanese firms.