TPCA: The output value of the Taiwanese PCB industry in Mainland China and Taiwan reaches NT$ 136.2 billion in Q1 of 2019

2019/05/31 Monthly Headline
     TPCA (Taiwan Printed Circuit Association) announced the production and sales figures for the first quarter of 2019. The statistics shows that the Taiwanese PCB industry reached NT$ 136.2 billion (about US$ 4.418 billion) in the first quarter of 2019. When compared to the same period last year, it has declined by -3.4% from NT$ 141 billion. Taiwanese companies’ production in Mainland China accounts for 62.5%, while it is estimated that the output value in the second quarter of 2019 will reach NT$ 152.6 billion.
      TPCA indicates that the first quarter is the traditional weak season in the PCB industry. Due to the Chinese New Year, our customers stocked up in advance. Therefore, for the observed PCB overall shipment, the decrease in the demand is lower than that in the output value. The factors below have affected the overall performance of the Taiwanese PCB industry in the first quarter of 2019: 1. Traditional weak season plus low mobile phone sales. The decline in the first quarter appears reasonable. 2. The decline in the sales of mobile phones made by US-based companies has led to the decline in the demand for flexible PCBs made by Taiwanese companies. 3. The competition among automotive PCB manufacturers has been increasingly fierce because the car sales declined, and there are more and more entrants. 4. The unexpected growth of the rigid-flex PCB still cannot complement this.
      While the second quarter of 2019 may not be the weak season, the semiconductor industry has poor performance so that the PCB industry must be conservative about the outlook. The carrier boards and flexible boards play a key role in the growth of the output value. For the carrier board, because the supply of ABF is still unable to meet the demand, the manufacturers of the carrier board have been expanding their production capacity. There, the ABF carrier board has been the key momentum which drives the growth of the carrier board. However, it is estimated that the mobile phone shipments in the second quarter will not increase. The decline in the demand of the carrier board used in the mobile phone may be higher than that of the ABF growth. This is a key factor which affects the growth of the carrier board in the second quarter or even the whole year. The manufacturers of flexible PCBs are susceptible to the US-branded phones. After the manufacturers of mobile phones made by US-based companies issued a shipment warning in the second half of 2018, the output value of flexible PCBs in the Taiwanese PCB industry has been affected significantly. It is expected that in the end of the second quarter, the manufacturers of flexible PCBs may gradually win the orders from US-based companies of mobile phones. Therefore, the output value of the Taiwanese PCB industry may slightly increase to NT$ 152.6 billion.
      It is worth observing some key issues in the second half of the 2019 which may affect the output value for the entire year: 1. Does the penetration of high-end phones increase? 2. Should Taiwanese PCB manufacturers rely less on the US-based companies of mobile phones for diverse customers and revenue streams? 3. Do Taiwanese companies hold a stable position in the original supply chain or have they been substituted? 4. The China-United States Trade War has entered a stage which has impacted on the substantial aspects.
    TPCA (Taiwan Printed Circuit Association) continues to pay close attention to the critical issues in the industry. We will communicate the important messages about the Taiwanese PCB industry through these review reports, informal discussion meetings and forums.