Taiwan’s small size, advanced infrastructure, and focus on emerging technologies make it well suited for the shift from aging combustion engines to renewable electric power.
While Taiwan’s semiconductor industry has traditionally taken center stage, its automotive sector may soon step into the spotlight. The country is well positioned to become an innovator, designer, and manufacturer of electric vehicles, with additional support from the Ministry of Economic Affairs, which is encouraging automakers to invest in domestic EV production.
Aside from electric engines, Taiwan’s software manufacturers are focusing on advanced cockpits with integrated, forward-thinking platforms. Multi-sensory interaction, immersive entertainment, and personalized settings are all being developed for future vehicles. For example, in-vehicle camera systems are evolving from simply “seeing and imaging” to “seeing and recognizing,” enabling real-time monitoring of driver behavior, passenger safety, and even emotional states to create a more intuitive experience.
Smart cockpits – featuring advanced human-machine interfaces, digital dashboards, and augmented reality head-up displays – are poised to become the industry standard. Complementary technologies, such as advanced driver-assistance systems and connected vehicle platforms, help anticipate road conditions and optimize driving patterns, improving both safety and energy efficiency.
Taiwanese technology leaders like Hon Hai Precision Co. (also known as Foxconn), working in collaboration with Nvidia, are accelerating these developments by investing in AI-driven software platforms for electric vehicles. “In the smart EV sector, Foxconn is actively developing its HHEV.OS software and integrating high-performance computing technology for the design, testing, and validation of vehicle projects,” Foxconn Chairman Young Liu said at a shareholders’ meeting last year.
Similarly, Taiwanese electronics manufacturing companies Inventec, Pegatron, and Wistron are all involved in supporting various domestic and worldwide EV projects.
Last year, Pegatron announced the opening of a joint laboratory in Taipei with NXP Semiconductors, Europe’s third-largest chipmaker. “The joint lab aims to accelerate Pegatron’s efforts in software-defined vehicles to enable better, safer, and more convenient driving experiences,” says Franco Lai, general manager of Pegatron’s Automotive Business Unit.
Taiwan’s automakers are also setting their sights on the broader Asian market. Domestically produced models, such as the Luxgen n7 and the Foxtron Model C, are designed for both Taiwanese consumers and overseas buyers.
While many companies have set up factories in Vietnam, Foxconn is keen to push cooperation with Japanese automakers. “When doing something together, compatibility is the most important thing,” Jun Seki, Foxconn’s chief strategy officer for EVs, told Nikkei Asia in an April interview. “From our perspective, the compatibility with Japanese automakers, especially Nissan, will become a strength for us.”
As of late March, Japan’s Mitsubishi Motors – a junior partner of Nissan Motor – began outsourcing electric vehicle production to Foxconn. The move is expected to help Nissan reduce output costs while accelerating the development of its EV lineup. Although neither Mitsubishi Motors nor Foxconn has officially confirmed the arrangement, it is widely believed that, following the collapse of a proposed merger between Honda and Nissan, Nissan has been actively seeking new partnerships. During a quarterly earnings call, Foxconn said it expected to sign an electric vehicle deal with an unnamed Japanese automaker within two months.
Building an EV nation
Taiwan aims for a full-electric switch for all scooters and private cars sold from 2040 onwards, with a net-zero carbon emissions target set for 2050. Taiwanese vehicle owners are eligible for government subsidies aimed at accelerating the transition to electric vehicles through 2026. The incentives vary by vehicle type and region.
For example, individuals replacing a small car with an EV can receive up to NT$3,000 (US$101) in recycling bonuses and subsidies. In certain areas, particularly Miaoli County, Hsinchu City, and Hsinchu County, higher subsidies are available – ranging from NT$5,100 for small combustion engine cars to as much as NT$200,000 for large commercial diesel vehicles.
The combination of government subsidies and promotions from EV manufacturers appears to be having an effect.In 2024, EV registrations in Taiwan exceeded 38,000 units, a 53.3% increase from 2023, according to the Ministry of Transportation and Communications (MOTC). Of the country’s 7.42 million passenger vehicles, EVs now account for 1.3% – roughly 5 electric vehicles for every 1,000 people in Taiwan.
It is not just the government driving EV adoption. Automakers are also offering their own incentives. Tesla, for example, is providing exemptions from license and fuel taxes through the end of 2025. Buyers who replace an old vehicle with a new EV priced above NT$1.4 million may also qualify for up to NT$50,000 in commodity tax reductions.
In addition, Mercedes-Benz’s EV lineup includes varying options of zero-interest financing, extended warranties, and free insurance for specific models. For its part, Volkswagen has introduced low-interest financing and a loyalty bonus subsidy of NT$30,000 for existing Volkswagen owners who want to purchase a new EV.
While not groundbreaking, these offers reflect a positive trend in how private companies are working to attract consumers to next-generation mobility.
From an infrastructure standpoint, increasing the number of charging stations is essential to helping foster the uptake of EVs. As of November 2024, Taiwan had built 10,086 charging stations (including 2,405 fast-charging and 7,681 slow-charging stations) for passenger vehicles in parking lots around the island. With 92,156 registered passenger EVs, this translates to roughly one charger for every nine vehicles and one fast charger for every 38 vehicles, meeting the European Union’s recommended ratios of 10-to-1 and 80-to-1, respectively.
Taiwan’s major cities – Taipei, Tai-chung, Tainan, and Kaohsiung – host the majority of the country’s charging stations. An increasing number of fast-charging stations are also being installed along the main north-south highways, Routes 1 and 3, serving the island’s most populous regions.
The growth of EV adoption has prompted private companies to expand into the charging network as well. Fortune Electronic, a Taiwanese heavy electrical machinery manufacturer, is aiming through its subsidiary Evalue to install 3,700 charging units by the end of 2026. Having secured contracts for nearly 2,000 charging stations through various government tenders, Evalue CEO Hsu I-sheng says the company could capture more than 30% of the domestic market.
All aboard the EV Bus
Building a framework of strategies, policies, and laws to encourage an EV-supported lifestyle is as forward-looking as it is ambitious. Taiwan’s government is leading the charge by purchasing electric buses, creating broader societal impact and institutionalizing green initiatives.
Taiwan aims to electrify its entire public bus fleet by 2030, supported by a budget of NT$64.2 billion (US$1.95 billion). Of that amount, the MOTC will provide NT$45.1 billion, with the Ministry of Environment (MOENV) covering the remainder.
The plan involves replacing around 14,500 diesel buses, through either purchases or retrofits, including 11,700 city buses and 2,800 other public transport vehicles. As of late last year, roughly 25% of municipal buses had already been upgraded to electric models. Given their regular routes and predictable mileage, public buses are among the easiest forms of transportation to electrify.
Meeting the 2030 target will require a growing pool of skilled workers. To address this need, the Highway Bureau plans to train 1,170 EV repair specialists over the next six years. Currently, nearly 2,000 electric buses are operating on Taiwan’s roads, but repairs remain slow due to a shortage of trained technicians, with buses often sent back to the factory and fixes taking up to a week.
Private bus operators are also being brought into the fold. The MOENV offers operational subsidies of up to NT$1.6 million per electric bus over four years, with support calculated based on mileage and passenger numbers. Special subsidy rates apply across Taiwan to further encourage adoption.
If fully implemented, the program is expected to cut carbon emissions by 307,000 metric tons and air pollutants by 4,327 metric tons annually.
Contributing to Taiwan’s EV bus initiative, Taiwanese Foxconn and Yulon Motor have launched a joint venture to produce electric cars and buses. A new facility in Kaohsiung Science Park has set an initial production target of 500 electric buses per year, with plans to scale up to 1,000 annually by 2028.
If these initiatives are fully realized, the resulting technological advancements and widespread EV adoption will significantly benefit Taiwan’s car manufacturers, chipmakers, and skilled mechanics – not to mention the gains in air quality and public health.
