The flexible PCB industry in Greater China currently stands as the world's second largest, clinching 13.3 percent of the global market next to Japan's 28.4 percent. Average annual production growth rates of about 15 percent are expected through 2008, higher than the projected worldwide industry growth rate of 8 percent.
Mainland China alone expects the production value of its flexible PCBs to account for 20 percent of the global output through 2010. Taiwan, which is fourth in terms of world market share at 12.8 percent, registered a production value of US$1.02 billion in 2005.
Although mainland China had only about 10 flexible PCB makers in 2000, low production costs and a widening application range have prompted manufacturers mostly from Japan and the United States to set up factories or establish their subsidiaries on the mainland.
To date, there are more than 100 flexible PCB manufacturers in mainland China, mostly located in or near Guangdong, particularly in Shenzhen, Guangzhou, Huizhou, Zhuhai and Dongguan, and Fujian Province.
Taiwan has 50 makers specializing in flexible PCBs, many of which are based in Taoyuan. Like most electronics and components manufacturers in Asia, Taiwan companies continue to move their main production bases to the mainland to optimize costs and resources.
The following are some of the key findings in the report:
• Many of the companies surveyed expect the telecom and home appliances sectors to remain the leading applications for flexible PCBs. About 48 percent of the makers plan to increase their production by at least 20 percent to cater to growing volume orders for such products.
• Flexible PCBs designed for PCs and peripherals, LCD TVs, digital cameras and PDAs will continue to be the mainstream products in the tail-end of 2006 and at least until the first half of 2007. Makers will also focus on emerging applications even as they continue to expand their output of standard products.
• R&D will center on HDI (2+N+2/ 3+N+3) PCBs or flexible PCBs with embedded passives technology; as well as the integration of flexible PCBs with COF, COB and COG technologies for LCD applications.
• Price hikes of up to 10 percent are likely for flexible PCBs from Taiwan and Hong Kong, spurred by rising raw material costs. Conversely, quotes of mainland China products are expected to drop by at least 5 percent as makers opt to remain price-competitive.
Industry Overview
The Greater China region is the world's second largest production center of flexible PCBs next to Japan. Mainland China alone accounts for about 20 percent of the world's production value, according to the China Printed Circuit Association (CPCA). Production in Greater China is projected to accelerate at an average rate of 15 percent yearly, faster than the forecast worldwide industry annual growth rate of 8 percent. Buoyed by an expanded range of applications in the telecom, IT and digital home electronics sectors, mainland China produced 19 million square meters of flexible PCBs in 2005 worth US$1.7 billion, up 10 percent year-on-year, the CPCA estimates.
In Taiwan, flexible PCBs represent about 10 percent of the total PCB production. Of the more than 200 PCB manufacturers on the island, more than 50 produce flexible PCBs, as estimated by the Taiwan Printed Circuit Association (TPCA). The production value of flexible PCBs reached US$1.02 billion in 2005 and is expected to increase by about 10 percent to US$1.10 billion in 2006.
In terms of world flexible PCB market share, mainland China's share is 13.3 percent, according to a study by the Electronics Industry Market Research and Knowledge Network, while Japan takes the largest share of 28.4 percent, followed by South Korea at 16.5 percent. Taiwan's share is 12.8 percent. While Japan focuses on the high-end, mainland China and Taiwan zoom in on mid-range and low-end products.
Industry Composition
Mainland China's flexible PCB industry has grown substantially, from 10 mostly domestic suppliers in 2000 to the current 100-plus manufacturers, most of whom are export-oriented. Low production costs have encouraged manufacturers from Japan, Taiwan and the United States to set up factories or establish subsidiaries on the mainland. Manufacturing is centered in Guangdong and in the East China areas, such as Shanghai, Fujian and Jiangsu, primarily because mobile phone and consumer electronic manufacturers are also based there.
About a third of the flexible PCB companies on the mainland, including Taiwan and Hong Kong owned enterprises, are foreign-owned. These companies represent 80 percent of the large-scale makers, with an annual production value of more than US$6 million each.
Supplier Profile
Career Technology (Mfg) Co. Ltd
Career Technology (Mfg) Co. Ltd was established in 1992 in Taipei, Taiwan. Career manufactures integrated flexible PCBs, such as COF and COB with wire-bonding PCBs and COG PCBs. Aside from flexible PCBs, the company also offers elastic and integrated services such as IC bonding.
In April 2003, Career merged with Pucka Ind. Co. Ltd, which was founded in 1978. At present, Career claims to be one of the top manufacturers of flexible PCBs in Taiwan and among the top ten makers in the world. The company was listed on the Taiwan Stock Exchange in 2002. It has a workforce of about 5,200 and operates sales channels in mainland China, Hong Kong, Japan, Singapore, Malaysia, South Korea, the United States and Finland.
Career offers OEM and ODM services, which takes up fifty-fifty of production. It exports 48 percent of its total output. The company mainly ships its flexible PCBs to East Asia, which absorbs 58 percent of its exports; Southeast Asia and the Middle East, 25 percent; and Europe, North and South America, a total of 17 percent. Its major customers include Motorola, Samsung, LG, BenQ, Siemens and Pantech. It also supplies flexible PCBs to Compal, Quanta, Wintek, AUO and Asustek. Career ships its products mainly by airfreight.
In 2005, annual sales reached more than US$219 million. From January to April 2006, sales have so far reached US$67 million. The company projects that at least 38 percent of its 2006 annual sales will come from multilayer and air gap flexible PCBs, while 34 percent from double-sided flexible PCBs, 23 percent from single-sided flexible PCBs, and 5 percent from rigid-flex PCBs.
Manufacturing Capability
Career has six manufacturing plants. Three are in Taipei and the other three facilities are in Kunshan, Suzhou and Shenzhen. The company is currently building its seventh factory in Taipei. The 42,900-square-meter factory is expected to be completed in the first quarter of 2007.
All this column of information contained in China Sourcing Reports is the result of original, independent and impartial research conducted by Global Sources analysts.
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