(September 15, 2021)
　　The Taiwan Printed Circuit Association (TPCA) announced today that the combined output value of Taiwan’s cross-strait PCB industry reached NT$182.3 billion (approximately US$6.513 billion) in Q2 2021 and NT$355.7 billion (approximately US$12.621 billion) in the first half of the year, a record high for the first half of the year and a significant increase of 19.3% from NT$298.1 billion for the same period last year. The estimated output value for Q3 2021 will reach NT$195 billion, and the annual output value is expected to reach NT$773.8 billion.
　　In addition to the record high production value, another noteworthy figure is the reversal of the growth performance of Taiwan’s PCB production value on both sides of the Taiwan Strait. Although 62.8% of overall production remained in mainland China in Q2, the growth rate of substrate production in Taiwan surged to 22.9%, surpassing the 19.8% growth rate of Taiwanese PCB production of substrate in mainland China. This demonstrates that the benefits of Taiwanese PCB companies’ investment in high-end technology expansion in recent years have begun to bear fruit, and this growth phenomenon is expected to continue.
　　In their announcement, TPCA indicated that despite the continued decline in production value of rigid-flex PCBs in Taiwan in Q2, other PCB products maintained the Q1 growth trajectory. IC substrate particularly benefited from strong demand, increased production capacity and price increases, which drove significant growth in revenue, with an annual growth rate of 34.8%, the highest growth rate of PCB products this quarter. Coming in second are multi-layer PCBs, which benefited from the continued strength of notebook orders and the gradual recovery of the automotive market, with an annual growth rate of 18.2%. Single and double-sided boards and HDI also grew by 11.5% and 5.5% this quarter, respectively. As for flexible boards (FPCs), although the demand for iPhone is slowing down and the growth rate is not as strong as the previous two quarters, the demand for notebooks, tablets and other computer-related products and automotive electronics remain strong, which helped maintain revenue growth of 8.3%.
　　Despite the impact of the COVID-19 pandemic in Asia, the scarcity of global supply of raw materials and chips and other negative factors in the first half of the year, the PCB industry was bolstered by solid growth in the end-user market, strong market demand for PCBs, and increased production capacity as well as other positive factors, resulting in record performance in the first half of the year. Looking ahead to the second half of 2021, with the second half of the year being the traditional peak season, the performance of this year’s PCB production value is highly anticipated. However, with the positive effects in the first half of the year, and healthy business growth seen in the traditional low-season, some industry players have started to feel the imbalance in global supply and demand for IC chips. The impact is not only evident in automotive applications, other electronic products have also begun to be affected by the supply and delivery of chips. Some end-use customers have even started to slow down orders in the second half of the year, which resulted in recent changes in PCB production schedules due to the adjustment of the delivery date of raw materials. Whether the growth momentum of the first half can continue into the second half of the year remains to be seen. The PCB industry should remain vigilant to the changes in supply and demand in the industry supply chain and retain the agility to respond to market changes.

Remarks：The full report will be published in TPCA’s 93rd quarterly newsletter and on the TPCA website.