Taiwan Blocks Chinese EV Motorcycle Firm Due to State Ownership

Taiwan's Ministry of Economic Affairs has blocked expansion plans for Chinese electric motorcycle maker Zhangxue, citing the company's ownership by a state-run enterprise linked to the Zhejiang Provincial Government. This decision highlights Taiwan's cautious approach to investments from mainland China, particularly those with state backing.

Zhangxue's chairman, Zhang Xue, had announced plans for the company to establish a presence in Taiwan by next year. However, Taiwan's regulations prohibit the import of complete Chinese-made vehicles. The Mainland Affairs Council (MAC) spokesperson, Liang Wen-chieh, further elaborated that Zhangxue's upper-level shareholder is a state-owned enterprise under the Zhejiang Provincial Government. This means any investment in Taiwan would require a special review, distinguishing it from a typical private enterprise seeking to enter the market.

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We are not a department for industrial development or industrial policy. Whether a particular industry needs protection or support requires a consultation process and procedure.

China's Taiwan Affairs Office criticized Taiwan's move, accusing the Democratic Progressive Party (DPP) administration of maintaining a rigid stance on independence and escalating discriminatory trade restrictions. They claimed Taiwan is obstructing normal cross-strait economic exchanges. Liang Wen-chieh countered that the regulations preventing the import of Chinese vehicles and parts have been in place for years, applied consistently by both DPP and previous Kuomintang governments.

Liang explained that opening the market to products previously banned from import requires a consultation process. This involves seeking opinions from relevant industry associations, conducting economic impact studies, and ensuring that the move would not significantly harm domestic industries. He suggested that if Zhangxue wishes to invest in Taiwan, it must engage with Taiwanese motorcycle industry guilds, manufacturers, and parts suppliers to gauge their views before any decision can be made.

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For Zhangxue, we may need to consult the opinions of Taiwan's motorcycle industry guilds, motorcycle manufacturers, motorcycle parts suppliers, and brand operators, and then make an overall consideration.