Looking back at the development of Taiwan's PCB industry in 2023, amidst underperformance in its three main application markets - smartphones, computers, and semiconductors - the industry experienced a 16.7% decline, reaching a value of NT$769.8 billion. This marked a significant drop from the historical high of over NT$900 billion, falling sharply to below NT$800 billion in 2022. Looking ahead to 2024, with the easing of inventory pressure in the terminal market, it is expected that the main application markets will enter a recovery phase. Supported by the low base effect, the overall Taiwan PCB industry is forecasted to resume growth with a 6.3% annual growth rate, reaching a total production value of NT$818.2 billion domestically and abroad. This recovery is expected to drive the revival of the supply chain, with the total production value of the Taiwan PCB industry chain (PCB manufacturing, materials, equipment) estimated to reach NT$1.21 trillion, with a growth rate of 7.4%.

Taiwanese PCB Sector Faces Headwinds in 2023, Automotive Applications Thrive Against the Odds as Focus
　Looking back on 2023, the overall product structure of Taiwanese PCB manufacturers consisted of multilayer boards (29.9%), flexible boards (26.0%), HDI (19.3%), carrier boards (15.6%), single/double-sided boards (7.6%), and others (1.6%). Apart from the momentum in automotive and AI-driven multilayer boards, all products experienced a comprehensive decline due to pressure from destocking at the terminal. End applications were categorized as follows: communication (33.9%), computers (21.4%), semiconductors (15.6%), automotive (13.2%), consumer electronics (11.0%), and others (4.9%). Automotive applications were the only growing sector amidst last year's downturn, with a full-year growth rate of 2.8%. The rest—communication, computer, and consumer electronics applications—were adversely affected by high inflation, high interest rates, and economic uncertainty, leading to reduced consumer confidence and further market demand depression due to destocking strategies. Semiconductor applications for carrier boards, primarily focused on the smartphone and personal computer markets, similarly suffered from the aforementioned adverse factors. Additionally, coupled with a high base period, carrier boards, which had repeatedly propelled the industry to new heights in the past, became the product with the largest decline in 2023.
　From the perspective of production bases, the Taiwanese PCB industry is still primarily centered in mainland China, accounting for approximately 65.6% of the production value in the fourth quarter of 2023. Taiwan followed with a production value proportion of about 31.7%. Over the past year, the declining demand for carrier boards led to a sequential decrease in production value in Taiwan, widening the production value gap between the two sides of the Taiwan Strait once again. Additionally, with the arrival of the peak consumption season in the latter half of last year, the market's pull for consumer electronics products, primarily produced in mainland China, further increased production value. Taiwanese manufacturers' production in other overseas locations accounted for approximately 2.7%, concentrated in Southeast Asia (Thailand, Malaysia, and Vietnam), mainly focusing on multilayer boards and HDI, with primary applications in computers, consumer electronics, and automotive products. Over the past year, geopolitical tensions and international clients' restructuring of supply chain strategies prompted Taiwanese firms to expand once again into Southeast Asia. However, barring any significant unforeseen events, mainland China and Taiwan are expected to remain the main production bases for Taiwanese manufacturers in the coming years.

Fermentation of New AI and Electric Vehicle Applications, Pushing for Sensible Recovery This Year
　Looking ahead to the development of Taiwanese-owned PCB industry in 2024. Positive factors include: 1.) The continuous expansion of AI applications from the cloud to the edge, further driving demand for high-end PCB products; 2.) Under policy promotion and with Mainland-based car manufacturers actively exploring overseas markets, the penetration rate of electric vehicles is expected to increase; 3.) As inventory pressures in terminal markets ease, key markets such as smartphones, computers, and semiconductors are expected to enter a period of recovery; 4.) The development of other emerging applications (satellite communications, VR/AR/MR, wearable devices) will bring new growth opportunities to the PCB industry. Negative factors still need to be considered: 1.) Slow global economic recovery and a high interest rate environment will continue to affect consumer confidence; 2.) Intensified geopolitical conflicts leading to international instability; 3.) Economic risks in Mainland China may impact the recovery of the consumer market.
　Taking into account the factors mentioned above, despite the ongoing uncertainty in the global economic and political situation, the easing of inventory pressures in terminal markets and the low base year of 2023, core markets such as smartphones, computers, and semiconductors are expected to enter a period of recovery. Additionally, with the continued demand in areas such as electric vehicles, AI servers, and satellite communications, it is anticipated that the Taiwanese PCB industry will resume growth in 2024, with an expected annual growth rate of 6.3%, reaching a production value of NT$818.2 billion.

The PCB supply chain took a breather in 2023 to adjust to the environment, gearing up for a resurgence in opportunities in 2024
　In 2023, the PCB materials sector experienced significant price declines in the first half of the year due to oversupply, which had a major impact on production value. However, the continuous increase in demand for high-frequency and high-speed materials from AI servers supported the performance in the second half of the year. On the equipment side, the sluggish market led board manufacturers to reduce investments in equipment, affecting the overall situation. Therefore, the production value of PCB materials for Taiwanese companies in 2023 was approximately NT$305.3 billion, a decline of 14.7% compared to 2022, while the production value of PCB equipment for Taiwanese companies in the same year was approximately NT$56 billion, a decline of 16.8% compared to 2022.
　Looking ahead to 2024, with the recovery of terminal markets, growth in PCB manufacturing is anticipated, which will also drive the performance of the PCB supply chain. Particularly, the demand for high computing power and high-speed transmission brought by AI is expected to propel Taiwanese PCB materials to achieve a higher growth rate compared to PCB manufacturing and equipment. It is estimated that Taiwanese PCB materials will see an annual growth rate of 10.4%, reaching a production value of approximately NT$337 billion. Additionally, as the global economy and terminal markets continue to improve, board manufacturers will increase capital expenditure to alleviate process bottlenecks or establish new overseas facilities. It is forecasted that Taiwanese PCB equipment will experience an annual growth rate of 5.4% in 2024, with a production value of approximately NT$59 billion. Therefore, the total production value of the Taiwanese PCB industry chain (including manufacturing, materials, and equipment) is expected to reach NT$1.21 trillion, with a growth rate of 7.4%.