Taiwan is world famous for making semiconductors and electronics. Its factories have mastered the intricate work of etching circuits onto silicon, churning out most of the world’s supply of advanced computer chips.
The island is also a major source of another essential and often invisible component of everyday objects: screws. And most go to the United States, where they are used to build airports, backyard decks and bathroom cabinets.
Now, President Trump’s 50 percent tariffs on steel and aluminum, which took effect in June, have left Taiwanese screw makers wondering how their businesses will survive the next few months. For the United States, Taiwan has been the No. 1 source of screws and metal fasteners like nuts and bolts for more than three decades, with China gaining ground as the second largest.
Taiwan’s screw factories, in the island’s south, sprawl across industrial districts like Lujhu and Gangshan, where the sounds of chugging machinery echo around the clock.
The area is home to around 1,500 companies making screws, and about one in every eight people works in the industry, according to Chiu Chih-Wei, a legislator from Kaohsiung. The road is littered with so many stray screws and metal pieces that drivers frequently need to replace their tires.
Kent Chen’s grandfather founded Sheh Fung Screws Company in 1973. Its factories operate day and night making more than 1,000 types of screws. Most of them are sold under his customers’ brand names in the United States at stores like Home Depot.
Mr. Chen, 48, took over the management of Sheh Fung in 2010. He invested in new equipment and systems to appeal to foreign customers, and worked with an American company that makes paint for cars to color-match screws to wood. Business boomed.
The company developed hundreds of types of screws for fastening wood and concrete. Some were used to build shopping malls, others for front porches and office shelves.
But since the steel tariffs took effect, Sheh Fung’s orders have been down nearly 20 percent compared with the same time last year.
“Everything is in pause mode,” Mr. Chen said. “A lot of our customers said, ‘We’ll see,’ but then we didn’t receive many orders.”
Last month, Taiwan’s exports of tech products like chips and artificial intelligence servers jumped more than 50 percent from last year as companies front-loaded shipments ahead of possible price increases. But nontech exports like screws slumped nearly 6 percent.
In addition to Mr. Trump’s tariffs, a problem for exporters like Sheh Fung is the surge in Taiwan’s currency. It has appreciated sharply against the U.S. dollar this year, a disadvantage for an export-driven economy.
“We never take losses,” Mr. Chen said. “But this year, in the second quarter, we really took quite a big loss because of the currency situation.”
Officials in Taiwan have said they will monitor the exchange rate, but have not taken any action to adjust it. Any move by the Taiwanese government to tamp down the currency’s rise could draw the ire of the Trump administration. Taiwan is one of nine major trading partners the U.S. Treasury Department is monitoring for potential currency manipulation.
Taiwanese manufacturers are also facing intense competition from screw makers in China.
Lu Chu Shin Yee, one of Taiwan’s largest screw companies, has been making steel products since 1965. Today the company makes screws used in specialized applications like subway cars, high-speed trains and exhaust fans in data centers.
Chinese companies often quote prices that are 30 to 50 percent lower than Taiwanese screw makers, said Karl Tsai, 61, the general manager of Lu Chu Shin Yee and son of the company’s founder.
Taiwan’s screw makers have faced mounting pressure from Chinese competitors for more than a decade. But the combination of Mr. Trump’s tariffs and the currency appreciation have forced the industry to a tipping point. Profit margins are thinner for screw makers than computer chip makers. And factory owners said they also compete with Taiwan’s chip sector for government support and workers.
Mr. Chiu, the Kaohsiung legislator, said he estimated that about a dozen factories in his district had closed since the currency began appreciating and the tariffs took effect.
Whole neighborhoods between Tainan and Kaohsiung are devoted to the screw industry. Trucks haul coils of extruded steel down streets where some factories form the screws, others repair machinery and still others apply coatings.
At Eternal Golden Plating, which coats screws used in cars and motorcycles, business was so good last year that the factory planned to hire enough people to add a second production shift, said Gino Yang, 42, who has been the president since 2021. But because of the tariffs and exchange rate pressure, he has hired only two new workers.
Some big companies like Lu Chu Shin Yee and Sheh Fung have factories in China, the Philippines and Vietnam, where they can move production to help lower costs. But smaller manufacturers don’t have that flexibility, Mr. Yang said.
“Small businesses like ours can’t survive without orders,” he said.
The chief executive of Home Depot, Ted Decker, has promised that by next year, no single country outside of the United States will represent more than 10 percent of all the company’s purchases. He said on an earnings call in May that more than half of its purchases were already from American manufacturers.
But Taiwanese screw makers said the United States did not have the kind of factories it needed to replace imports from the island.
Americans would not be willing to work in such factories for wages that companies pay in Taiwan, said Mr. Tsai of Lu Chu Shin Yee.
Even Taiwan’s most advanced chip maker, Taiwan Semiconductor Manufacturing Company, has had troubling recruiting a sufficient number of skilled workers to its Arizona factory, Mr. Tsai pointed out. And handling hot stainless steel is even more grueling than working in a chip plant.
“How could this kind of work happen in the United States?” Mr. Tsai asked. “It couldn’t.”
Meaghan Tobin covers business and tech stories in Asia with a focus on China and is based in Taipei.
Xinyun Wu is a reporter and researcher covering technology and business in China and Taiwan and is based in Taipei, Taiwan.
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