The Taiwan Printed Circuit Association (TPCA) announced the 2021 Q1 output of Taiwanese PCB manufacturers at NT$173.4 billion (approx. US$6.108 billion), a new high in Q1 of the industry’s history and a significant increase by 26.7% at NT$136.9 billion YoY. The proportion of production in China of Taiwanese PCB manufacturers is about 63.2%, and the 2021 Q2 output is estimated at NT$170.7 billion.

　　According to TPCA, despite the fall of the rigid-flex board due to the engineering change of AirPods, the growth of all other products in Q1 benefited from the rise of high-level 5G mobiles, the ongoing demand for laptops from work/school from home due to the pandemic, and the amelioration of the auto market. Particularly, the growth of FPC, multilayer board, and HDI was even over 20%. Although the Q1 growth of IC substrates at 18.6% was not as brilliant as other PCB products, a two-digit growth was maintained for five consecutive quarters. Due to the undersupply of ABF substrates, the boom of IC substrates is expected to continue until the end of the year.

　　Looking out to 2021, although a good start was predicted following the pandemic’s slowdown in Europe and the USA, the popularization of vaccines, and the turn from 4G to 5G, which bring a total PCB boom in all applications, the critical global supply has spurred the price of materials. For example, besides the copper price escalating since last year, the price of fiberglass yarns and epoxy also rose. Instead of a one-time rise, PCB manufacturers can only suffer the stepwise price rises of materials suppliers. Even worse, the outbreak of COVID-19 in Q2 in India, the world’s second-largest market and production base of mobiles, has brought forth the worry if this will impact Taiwan’s PCB industry since the communication/mobile applications of PCBs in India account for over one-third of the total PCB output. However, further observation shows, as the Chinese low-level and medium-level mobiles are the major products in India, and Chinese PCB manufacturers mostly supply their PCBs, the pandemic in India has no direct impact on Taiwan’s PCB industry so far.

　　Besides India, just when the pandemic seemed to decline worldwide, it broke out in Taiwan in May and led to a level 3 control. Apart from following the government’s epidemic control policy, Taiwanese PCB manufacturers have intensified their pandemic response, and no significant impact on production has been reported so far. As the condition escalates, if confirmed cases are detected in the production line, the countermeasures will still affect part of the capacity and workforce dispatch. As the deployment of production lines is different at home and abroad, and due to the need to fulfill the verification demand of customers, manufacturers have reduced the proportion of overseas production lines. However, although Taiwan’s IC substrate output is the highest in the world, as the difference is less than 5% from competitors in South Korea and Japan, if the pandemic persists in Taiwan and the global chip shortage continues, competitors in South Korea and Japan will easily take over Taiwan because of the small difference. Therefore, this is another worry that may affect Taiwan’s semiconductor and IC substrate industries.

　　It never rains but pours! Besides the pandemic, water shortage, power shortage, and unstable materials supply are the other issues that Taiwanese PCB manufacturers must face in Q2. Due to the water shortage this year and the unexpected power outage in May, water rationing has begun in some cities and counties. Although manufacturers have a lot of orders at hand, manufacturers have suffered a cost increase in Q1 due to the shortage in material supply and shipping service. Furthermore, the level 3 pandemic control that increases water and power consumption by work/school from home also worsens the conduction of water and power shortages. These thus mark out the very issue that resolving the water, power, land, workforce, and talent shortages is the key mission for the government of Taiwan to empower the manufacturing industries to create economic growth.

　　After the US-China trade war, Taiwan’s electronics industry chain has created a new record high to both Taiwan’s economy and stock market due to its geographic advantage. In response to the industry’s need, the government is also actively transforming Taiwan into the “Asia Advanced Manufacturing Center” and “Semiconductor Advanced Process Center.” Many enterprises have supported the government’s policy. The PCB industry has even experienced the largest return in recent years. However, either the “Asia Advanced Manufacturing Center” or the “Semiconductor Advanced Process Center,” the related industries need to use a lot of water and electricity and require the support of well-established infrastructure. Facing the transformation of the global energy policy and the indeterminate environmental changes, both the government and enterprises need to make the advanced deployment.