Industry Focus >>Taiwan's Fastening Tools
Development Trends and Competitiveness● Foreword

台灣扣件緊固工具產品發展趨勢與競爭力

Taiwan is the world's 2nd largest exporter of fastening tools which are defined as
handheld tools for fastening/loosening fasteners (screws, nuts, studs, bolts, nuts, etc.).
Fastening tools and fasteners are different products, but there is a high degreeof relevance, i.e., these two products need to be operated in conjunction withthe performance and proper application of the industry. The value of Taiwan
fastening tools export even surpassed those of Japan, Germany, the U.S. andother advanced countries, but what is worth exploring behind the brightfigures is that the export value only revealed the short-term export scale,
which is vulnerable to industry trends and competition, but the long-termcompetitiveness of products requires solid industrial manufacturing capacity
and a sound industrial supply chain.
Overall, the new product development trends of fastening tools are:ergonomics, ease of operation, application of new materials, lightweight design,
digital technology, etc. This article analyzes the product development trends andcompetitiveness of Taiwan's fastening tools, and explores the scope of products(including wrenches & spanners, socket wrenches, screwdrivers, etc.) as well as theindustry trends, materials, and net-zero carbon reduction.
● Review and Analysis of

the Economic
and Trade Development Trends ofGlobal Fastening Tools

Hardware & Fastener Components - no.61/2024

a. Import:

124

Table 1 shows the global major importersof fastening tools and the import trend from2018 to 2022. In 2022, the global importvalue of fastening tools was about US$8,612
million (about NT$256,465 million) and thetotal import value of the top 10 importing
countries was US$4,477 million, accountingfor 52% of the global total import, andthe compound growth rate of the imports
in the past five years was 3.3%, slightly
higher than the global compound growthrate of 3.1%; among them, the respective
import values and shares of the top 5
importing countries in order were: theU.S. (US$1.569 billion/18.2%), Germany(US$766 million/8.9%), Canada(US$321 million/3.7%), France (US$320million/3.7%), and the UK (US$301
million/3.5%). Although imports may not
be always equivalent to industrial demand
and the domestic production and stock still
have to be considered, the trend of imports
also reflects the demand for products invarious countries. The U.S. is still theworld's leading importer of fastening tools
and in 2022 it further expanded its importshare from the world. The U.S. with thehighest import value (US$ 1.569 billion)
and a stable compound growth rate (6.6%)
plays a role in driving the demand forfastening tools in the global market.
惠達雜誌Table 1. Global Major Fastening Tools Importing Countries and the Import Trend in 2018-2022(Unit: US$0.1 bn;％)
Ranking
Country
1
USA
2
Germany
3
Canada4
France5UK
6
Mexico7
China
8Netherlands
9
Thailand
10
PolandSubtotal of Top 10
Importers
Subtotal of Other
Importers
Total

2018
12.16
6.57
2.54
3.63
2.95
2.22
2.70
2.05
2.59
1.96

2019
12.30
6.34
2.74
3.25
2.69
2.18
2.57
2.12
2.53
1.76

2020
11.01
5.99
2.54
2.59
2.42
1.72
2.50
2.14
2.10
1.70

2021
14.33
7.67
2.91
3.32
3.01
2.26
3.35
2.66
2.57
2.35

2022 2022 Share of Total
15.69
18.2%
7.66
8.9%
3.21
3.7%
3.20
3.7%
3.01
3.5%
2.50
2.9%
2.47
2.9%
2.45
2.8%
2.33
2.7%
2.26
2.6%

CAGR
6.6%
3.9%
6.0%
-3.1%
0.5%
3.0%
-2.2%
4.6%
-2.6%
3.6%

39.38

38.50

34.71

44.42

44.77

3.3%

52.0%

36.88

35.23

32.19

40.19

41.35

48.0%

2.9%

76.25

73.73

66.90

84.62

86.12

100.0%

3.1%

Source: ITC/compiled by MIRDC
Note: Based on the 2022 average exchange rate (NT$29.78 per US$1) of the Central Bank of Taiwan

b. Export:
Table 2 shows the global major fastening tools exporting countries and the export trend from 2018
to 2022. In 2022, the global fastening tools export amounted to about US$8.021 billion (NT$238.865billion) and the total export value of the top 10 exporting countries was US$6.116 billion, with theexport compound growth rate averaged at 4.1%, which was slightly higher than the global compound
growth rate of 3.5%, and the total export value already accounted for 76.3% of the global total, ahighly concentrated export structure. Among them, the respective export values and shares of the
top 5 exporting countries in order were: China (US$2,312 million/28.8%), Taiwan (US$1,074million/13.4%), Germany (US$1,057 million/13.2%), the U.S. (US$516 million/6.4%), and Italy(US$241 million/3.0%). Compared to 2021, Taiwan even surpassed Germany to become theworld's second largest fastening tools exporting country in 2022, with a compound growth rateof up to 7.8% in recent five years, a remarkable performance.

Industry Focus >>China continues to be the world's leading fastening tool exporter. Even under themultiple impacts of the global political & economic situations, it still ranked first withthe highest export value (US$2.312 billion) and a stable high compound growth rate
(8.7%), which demonstrates that with the production advantage of the economy of scale
China’s leading position has been not that easy to be challenged by various global variables.
Table 2. Global Major Fastening Tools Exporting Countries and the Export Trend
in 2018-2022(Unit: 0.1 bn USD;％)
2022
Share of CAGR
Total
28.8%
8.7%
13.4%
7.8%
13.2%0.5%
6.4%
-0.7%
3.0%
-0.9%
2.6%
2.8%
2.4%
1.9%
2.3%
-4.5%
2.2%
0.3%
1.9%
-4.8%

Ranking

Country

2018

2019

2020

2021

2022

123
4
5
67
8
910

China
TaiwanGermany
USA
Italy
India
Netherlands
FranceSwitzerland
Singapore

16.54
7.96
10.37
5.29
2.50
1.87
1.79
2.22
1.72
1.89

16.65
8.31
9.77
5.22
2.41
1.71
1.82
2.44
1.61
1.56

17.08
8.04
9.31
4.16
2.05
1.52
1.64
1.74
1.41
1.52

22.69
10.33
11.35
4.92
2.74
2.25
1.92
1.99
1.78
1.4223.12
10.74
10.57
5.16
2.41
2.09
1.93
1.84
1.74
1.56

Subtotal of Top 10
Exporters

52.15

51.50

48.46

61.39

61.16

76.3%

4.1%

Subtotal of OtherExporters

17.87

16.65

15.43

18.62

19.04

23.7%

1.6%

Total

70.02

68.16

63.89

80.01

80.21

100.0%

3.5%

Source: ITC/compiled by MIRDC● The Development

Trends of Fastening
Tools

a. Wrenches & Spanners (HS codes820411 and 820412)
a-1. The Development of Digital Adjustable
Wrenches and Spanners: Digital wrenches referto traditional wrenches embedded with chips.
When the nut is turned, it’ll display the torquevalue on the screen, avoiding the technician
to turn too loose or too tight, which is helpful
for specific operating conditions and industries(such as automotive, 3C manufacturing, etc.) toachieve higher precision assembly and stability;
although Europe, the U.S. and Japan havedeveloped digital fixed wrenches, only Taiwanesemanufacturers successfully developed the digitaladjustable wrenches for all sizes of nuts.
The R&D of digital adjustable wrenches in theICT field focuses on the design of sensor circuits,
the design of microelectromechanical sensor
circuits to reduce the error rate, the program
design of torque precision controllers, AntiEMI circuit design considering electromagneticcompatibility (EMC) and electromagneticinterference (EMI), the design of TFT display
circuits, the design of wireless and baseband

a-2. The Development of Fully Insulated Adjustable Wrenches: With the green energy trend leading to the development of EV and toconsider the voltage of EV being about 650V, higher than the voltage of traditional vehicles (DC 12-24 volts), the demand for fully-insulated
fastening tools is becoming increasingly important, so the entry barrier of fully-insulated hand tools in the processing and application ofmaterials will be also higher, and they need to comply with a more complete set of certification standards, including obtaining the European
standards such as DIN EN 60900 (insulation hand tools common test and product size requirements), German DVE electrical safety
certification, DIN, ISO, JIS, ANSI, ASME & BSI, and other national standards bodies certifications. The use of chrome vanadium steel canwithstand the voltage of about 1000V; however, the price of an adjustable wrench is already 2-5 times higher than a general hand tool and theprice of an fully-insulated adjustable wrench is even 10% higher than a general adjustable wrench. Accordingly, fully-insulated adjustablewrenches are high value-added products. A few manufacturers in Taiwan are key suppliers in the insulated fastening tools market in Asia. Eventhough adjustable wrenches are a more advanced category in manufacturing of non-powered hand tools, leading Taiwanese manufacturers offully-insulated wrenches can still make profits as high as 40% with their mature technology.

b. Socket Wrenches (HS code 820420)
b-1. Fixed Torque Socket Wrenches: Currently, Taiwanese fixed torque socket wrench manufacturers have obtained patents for new types
and torque design in many countries, which can be matched with various handles to increase their peripheral functions suitable for precisionassembly lines; the current positioning of these products is mainly for fastening. Torque control is used to standardize tool operation during
the fastening process, providing better fastening accuracy and service life. After the rotation to reach the required torque, there will also be analert sound to inform the user that the torque has reached the preset standard value or tightening limit, avoiding the fastener damage causedby over-torque. In addition, color management is also used to avoid incorrect torque application and the precision tolerance is within ±10%;in addition, the fixed socket wrenches also have a non-return function, which means that they can be simultaneously used to loosen fasteners,
standardizing the fastening process and enhancing work efficiency.
b-2. Prestressed Socket Wrenches: A patented ring is used to apply stress around the hexagonal hole to counteract tensile stress, achieving
higher torque strength and extending the service life by 3 times. The product is also available in a variety of colors to differentiate between sizes.

惠達雜誌

Hardware & Fastener Components - no61/2024

electronic circuits, and bluetooth wireless communication technology, etc., and is coupled with the introduction of ergonomics and aesthetics
of engineering design, compliance with the ISO-6789 standard, and the service life of more than 10,000 cycles. It is sufficient to detect smallchanges in torque (up to 0.1N-m) and simultaneously integrates FM wireless transmission technology to realize the product networking
function; this type of digital torque wrenches can increase the unit price of traditional torque wrenches from NT$2,000 to NT$20,000, and theunit price of cloud database digital torque wrenches with networking function can be even increased to NT$33,000.

125Industry Focus >>c. Screwdrivers (HS code 820540)

c-1. Labor-saving Ratchet Screwdrivers:

New screwdrivers are developed and improved in
the direction of lightweight and labor-saving. The laborsaving ratchet screwdriver on the market features ahexagonal palm handle with a special triple molded
design. The labor-saving ratchet screwdriver has beenverified by the Human Factors Engineering BionicLaboratory to increase the rotational torque, allowing
the user to utilize 2-3 times the rotational torque of aconventional screwdriver when gripping and operating it,
and at the same time, through the internal plastic structure
to do universal swing to increase the operating space
and angle to absorb the force of movement and reducethe burden of the wrist joints. In addition to the abovefeatures, the use of labor-saving ratchet screwdrivers
also reduces the risk of deviation and skewing of screw
drilling operations, increasing the speed and reliability ofthe work. The products are designed and manufactured
by Taiwanese companies, and are sold to the U.S.,
Canada, Russia, and Scandinavia, and have been patented
in Taiwan, the U.S., and China.
c-2. Digital Power Screwdrivers:
They are mainly used in mobile phones, tablets,
industrial PCs with bluetooth connection to grasp torquedata in real time. Torque sensors provide direct and realtime torque information, and can customize torque,speed, and angle to achieve the desired fastening result.
Torque data and fastening status are displayed as "OK"or "NG" for real-time feedback. It is also possible toset the screw torque and the angle after fastening forachieving more precise fastening; In addition, the digital
power screwdriver recently developed by a Taiwanesemanufacturer has completed the compliance with theISO-6789 standard, as well as the durability level of theservice life of 10,000 cycles or more.

Factors Affecting
the Competitiveness ofFastening Tools
Hardware & Fastener Components - no.61/2024● Other126

a. Application of Premium Materials

a-1. Application of SVCM+ Materials in Tooling
Products
Chrome Vanadium Steel (CR-V) is a common alloysteel highly resistant to wear and maintains a stable highhardness after heat treatment, as chromium increases
hardness and vanadium increases toughness. The
combination of these two materials, combined withproper heat treatment, provides a significant increasein durability and tolerance accuracy. SVCM is a topgrade alloy tool steel containing Si, V, Cr and Mo, andthe higher-grade SVCM+ material is even superior toCR-V, which is sufficiently hard but not tough enough,and may result in wrench fracture if used with too muchforce at a certain point of application. SCVM+ has theadvantage of being more torsionally resistant than CR-V,
but there is a 40% difference between the prices of these
two materials.

惠達雜誌

a-2. Application of High Entropy Alloys in Fastening Tools
With the evolution of metal materials, new materials such as high-entropy
alloys have emerged. The so-called high-entropy alloys are alloys with morethan five major elements, and the atomic percentage of each major element
should be between 5% and 35%, while each minor element is less than 5%.
Different metals formulated into comprehensive alloys can feature higher
strength, hardness, ductility, high temperature resistance, corrosion resistanceand other functions than traditional alloys, and because of the unlimited numberof formulas, more elements can be added to enhance the alloy characteristics,
so the high-performance alloys still offer diversified R&D and application
opportunities in the future fastening tools market. To this end, a team ofacademics has developed a beryllium-free, non-toxic high-entropy alloy nonsparking tools, specifically for use in explosion and combustion hazardous areas,such as mine pits, oil tanks, refineries, gas plants, powder factories, explosives
factories, etc., to replace the use of beryllium-containing copper alloys thathave been in use for 100 years. In addition, the high entropy alloy featuring
a permanent sterilization effect can be also used to make sterilized knives,
cutting boards, door knobs, or railings & handrails in public areas, to replace theexisting materials such as stainless steel, the traditional easy-to-rust low-strength
copper alloys, plastics and wood.

b. Impact of Intelligent and Decarbonized Processes on
Product Competitivenessb-1. Intelligent Transformation: Currently, the intelligent production linesof Taiwanese fastening tool manufacturers can be all automated from grinding& polishing, mechanical processing, laser engraving, packaging and stacking tolathe processing. With the accumulated efforts in recent years, Taiwan fastenerindustry has advanced from single-station intelligent automated production linesto multi-station cascade automation and intelligent information integration.
The new line allows for faster tool changes, reducing the time for a specificprocess from the previous 30 minutes to 15 seconds, and reduces the number ofpeople required on a production line from four to one, which not only improve
efficiency, but also solve the problem of labor shortages in recent years. Throughintelligent transformation, labor requirements have been significantly reduced
by 60%~80%, and deliveries can be made one week ahead of schedule, withan increase in production capacity of nearly 30%. The upfront investment inautomation is high, but the long-term benefits to manufacturers are substantial.
b-2. Low Carbon Green Process: The EU's CBAM has been implemented
on a trial basis since October 2023 and has become an important rule in
int’l trade. It is roughly estimated that there are about 3,500 steel, fastener,
and aluminum product manufacturers in Taiwan who will be affected by themechanism; although fastening tools are not yet included in the scope of CBAM,
it is likely to be expanded in the future, and the ways to do so will include anincrease in the number of economies (or countries) and the increase in the scopeof products.
(1) Increase in the number of economies (or countries): Currently, there is only
the EU, but considering the response of various countries, it is very likely that
the U.S., Japan, China and other major manufacturing countries may create
their own CBAM in the future, forming a new global trade barrier.
(2) Increase in the scope of products: In the future, CBAM may be extended
to 52 types of products regulated by the EU ETS, and among these 52 types,
those related to fastening tools are "iron castings", which will also affectTaiwan's fastening tools export. Taiwanese manufacturers may be impacted
in the EU or the world if they do not react to this problem ASAP. Therefore,
Taiwanese fastening tool manufacturers not only need to continuously
strengthen product design, but also introduce low-carbon green processes or
intelligent production lines in the long run, which is the key to maintaining
the market and expanding the competitiveness of their products.
Copyright owned by Fastener WorldArticle by Dr. Arthur Hsu