Taiwan must tap into the global uncrewed aerial vehicle (UAV) market to obtain the capital necessary to develop a self-sufficient combat drone industry, experts said.
As defense analysts have speculated that China might invade Taiwan in 2027 or 2032, the nation must complete the decoupling of its drone supply chains from China in the next few years, Geosat Aerospace & Technology Inc (經緯航太科技) CEO Lo Cheng-fang (羅正方) said.
The ability to produce combat drones in wartime is crucial for Taiwan’s survival, but the nation’s UAV industry is still in its infancy, said Lo, who is also chairman of the Chiayi-based Asia UAV AI Innovation Application R&D Center.
Photo: CNA
The government should support the domestic industry to ensure Taiwan’s drone supply chains remain unbroken in the event of a military conflict with China, he said.
Drones are an integral part of President William Lai’s (賴清德) Five Trusted Industry Sectors, a category consisting of the semiconductor, artificial intelligence (AI), military, security and surveillance, and next-generation communications industries.
The administration aims to make Taiwan “the Asian hub of UAV supply chains for global democracies,” he said in his inaugural address on May 20.
These supply chains are made of about 40 Taiwanese firms that produce about a dozen drone models altogether, government data showed.
The Taiwanese drone sector was worth an estimated NT$2.86 billion (US$87.15 million) last year, while the global drone industry’s value is expected to reach US$80 billion by 2030.
Chiayi Economic Development Department Director Chiang Zhen-wei (江振瑋) said the global drone industry is split in two, with one side that uses Chinese supply chains and another that does not.
Because of those who have decoupled from China, there is a large opportunity for the domestic drone industry if it is prepared to seize it, he said.
The companies that are part of Chiayi’s drone center represent a complete UAV ecosystem, but the industry would still have to carve out an export market, Chiang said.
The operational costs of automated equipment capable of mass-producing reliable, quality components at scale cannot be funded by the domestic market alone, he added.
Despite Taiwan’s technical prowess, manufacturers cannot be expected to wade into the drone business just to supply domestic demand, said Lo Cheng-ying (駱正穎), a professor of mechanical engineering at National Formosa University.
“Becoming a part of the supply chain for democracies will be crucial going forward,” he said.
National Chung Cheng University strategic studies professor Lin Tai-ho (林泰和) said drones have significant battlefield applications and UAV manufacturing is an industry of ever-increasing importance strategically.
The Taiwanese UAV sector must develop an export market to supplement military contracts, especially as cheaper Chinese parts cannot be used, he said.
The Lai administration made the right call in pursuing the capability to manufacture drones independently of China’s supply chains, even if it is more expensive, Lin added.
Meanwhile, the government would play a key role in coordinating with its industrial partners, Hsuan Yuan Tech Co (璿元科技) CEO Chou Yu-tuan (周玉端) said.
The government must pay attention to industrial requirements in designing projects, as the current approach is leading to the proliferation of non-standard platforms with little commonality, which increases production difficulties and costs, he said.
The contract-issuing bodies of the government frequently demand changes to a project, such as its technical specifications and intended role, further adding to the chaos, he said.
Taiwan Swarm Innovation Inc (臺灣希望創新) CEO Li Chih-ching (李志清) said Washington is looking for allies to replace China in drone supply chains.
Taiwan has the technological capabilities to make drones, but Taiwanese systems are two to three times more expensive than their Chinese counterparts, he said.
Expanding into the global market would enable domestic UAV makers to benefit from the economy of scale and lower their prices to competitive levels, Li said.
However, the Taiwanese UAV sector is unlikely to be competitively priced compared with China, he said, adding the industry should concentrate on making drones for special applications for customers that cannot use systems that have Chinese parts.
MORE VISITORS: The Tourism Administration said that it is seeing positive prospects in its efforts to expand the tourism market in North America and Europe Taiwan has been ranked as the cheapest place in the world to travel to this year, based on a list recommended by NerdWallet. The San Francisco-based personal finance company said that Taiwan topped the list of 16 nations it chose for budget travelers because US tourists do not need visas and travelers can easily have a good meal for less than US$10. A bus ride in Taipei costs just under US$0.50, while subway rides start at US$0.60, the firm said, adding that public transportation in Taiwan is easy to navigate. The firm also called Taiwan a “food lover’s paradise,” citing inexpensive breakfast stalls
TRADE: A mandatory declaration of origin for manufactured goods bound for the US is to take effect on May 7 to block China from exploiting Taiwan’s trade channels All products manufactured in Taiwan and exported to the US must include a signed declaration of origin starting on May 7, the Bureau of Foreign Trade announced yesterday. US President Donald Trump on April 2 imposed a 32 percent tariff on imports from Taiwan, but one week later announced a 90-day pause on its implementation. However, a universal 10 percent tariff was immediately applied to most imports from around the world. On April 12, the Trump administration further exempted computers, smartphones and semiconductors from the new tariffs. In response, President William Lai’s (賴清德) administration has introduced a series of countermeasures to support affected
CROSS-STRAIT: The vast majority of Taiwanese support maintaining the ‘status quo,’ while concern is rising about Beijing’s influence operations More than eight out of 10 Taiwanese reject Beijing’s “one country, two systems” framework for cross-strait relations, according to a survey released by the Mainland Affairs Council (MAC) on Thursday. The MAC’s latest quarterly survey found that 84.4 percent of respondents opposed Beijing’s “one country, two systems” formula for handling cross-strait relations — a figure consistent with past polling. Over the past three years, opposition to the framework has remained high, ranging from a low of 83.6 percent in April 2023 to a peak of 89.6 percent in April last year. In the most recent poll, 82.5 percent also rejected China’s
PLUGGING HOLES: The amendments would bring the legislation in line with systems found in other countries such as Japan and the US, Legislator Chen Kuan-ting said Democratic Progressive Party (DPP) Legislator Chen Kuan-ting (陳冠廷) has proposed amending national security legislation amid a spate of espionage cases. Potential gaps in security vetting procedures for personnel with access to sensitive information prompted him to propose the amendments, which would introduce changes to Article 14 of the Classified National Security Information Protection Act (國家機密保護法), Chen said yesterday. The proposal, which aims to enhance interagency vetting procedures and reduce the risk of classified information leaks, would establish a comprehensive security clearance system in Taiwan, he said. The amendment would require character and loyalty checks for civil servants and intelligence personnel prior to
RSS