TPCA (Taiwan Printed Circuit Association) released production and sales data for Q3 2020. The statistics show the output value of Taiwanese companies across the Taiwan Strait in the PCB industry hit 185.9 billion TWD in Q3 2020, flat compared to the same quarter last year. If the factor of this year’s exchange rate volatility was incorporated, the total PCB output value of Taiwanese companies on both sides of the strait in Q3 this year would be 6.3 billion USD, up 6% over the same period last year. At present, the industry’s utilization rate in the 4th quarter is still at a high level, and the 2020 annual output value of Taiwanese companies across the Strait will arrive at 22.9 billion USD., which is expected to reach new highs.
　　According to TPCA, the total output value of the PCB industry on both sides of the Taiwan Strait in Q3 amounted to 6.3 billion USD, and this year’s 5G boost has enabled Taiwan’s PCB industry to maintain its output value despite the impact of the epidemic. In addition, large Taiwan-funded companies have returned to Taiwan to invest or expand production capacity and to invest in advanced processes in response to the demand for high-end 5G products, so that Taiwanese companies have a strong growth momentum in their output value, and their overall performance is better than that of Taiwanese companies in the mainland. The overall production share of Taiwanese companies in the mainland in Q3 was 62.5%, down around 1% from the previous quarter.
　　If the growth drivers are examined in detail, IC substrates and rigid boards were the key players in the growth of the quarter. With the lasting tailwind of robust high-end process demand, IC substrate’s Q3 growth rate remained at double digits, and due to capacity constraints and supply shortages, it is still the main growth engine for Taiwan’s PCB industry. Multilayer boards continued to benefit from the double effects of high demand for laptops and tablets driven by the remote working or learning requirement owing to the epidemic, and the rebound in automobile sales, turning revenues from negative to positive for the quarter, up 0.9% year over year. The upgrade in the specifications of mobile phone main boards because of 5G was still the main reason behind the better-than-average HDI growth rate this quarter.
　　The changes in product design have also brought part of the impact. For example, since TWS introduced the SiP + flex board design in Q4 last year, its share has kept increasing, which resulted in a sharp decline in the demand for rigid-flex boards. However, with iPhone eliminating accessories, the demand for SiP for headset applications has warmed up, boasting high-end substrate production performance.
　　Since the outbreak of the epidemic in early 2020, the development from the beginning to the end of the year has been unexpected. The impact of the epidemic on global economic activities gave the PCB industry no reason to be optimistic about 2020 at the beginning of the year. But fortunately, the 5G early-stage infrastructure and carrier applications filled the gap caused by the epidemic in a timely manner, further promoting PCB price and value. Taiwan’s PCB industry has benefited from semiconductor and 5G applications, and its output value this year is estimated to end up at 22.9 billion USD, slated to hit a record high. With 2020 coming to an end, many contemporary critical issues this year, such as the epidemic and international trade competition, are testing the adaptability of Taiwan’s electronics industry, and emerging issues as a result such as supply chain ecology, product and production deployment, digital transformation, are worthy of consideration by enterprises to respond in advance.

Remarks：The relevant and complete evaluation report will be published in TPCA Quarterly’s 90th issue and on the TPCA website.