Market observers are generally optimistic about the IC substrate and automotive PCB market prospects in the long term, with both product segments to become major growth drivers for related suppliers.
Taiwan Printed Circuit Association (TPCA) pointed out that driven by the booming semiconductor demand in recent two years, makers in the PCB sector with the highest annual revenue growth rates have been all IC substrate suppliers, with seven of them posting over US$1.0 billion for 2021 revenues, including Taiwan's Unimicron Technology, Nan Ya PCB and Kinus Interconnect Technology, Japan's Ibiden and Shinko, and South Korea's Semco and LG Innotek.
Hayao Nakahara, president of PCB market research body NT Information, also indicated that global IC substrate production was valued at US$15.6 billion in 2021, accounting for nearly 18% of total PCB output worldwide for the year.
Basically, the supply of high-end ABF substrates with larger areas and higher layer counts continues to fall short of demand for processing HPC and networking chips. But some industry observers opined that a slight oversupply of IC substrates also including BT-based ones, has emerged since mid-2022 amid sluggish terminal market demand for consumer electronics devices, which may drive substrate prices down to normal levels. At a recent investors conference, top ABF substrate maker Unimircon also delivered a conservative outlook for the rest of the year due to unfavorable macro environments.
Meanwhile, TPCA has warned of possible price competition among global IC substrate makers after their new capacities come online, given that their combined investments in capacity expansion expenses will exceed US$25 billion during 2019-2025.
On another front, automotive PCB products, especially those for EV applications, are also expected to sustain strong growth momentum in the longer term, industry sources said, adding that the amount of PCB needed for each EV is around three times that for a traditional oil-fueled car.
Despite IC shortages, COVID lockdowns and harbor congestions, global car sales still managed to grow slightly to 83 million units in 2021 from 78 million in 2020, with EV shipments alone doubling to 6.5 million units from three million, the sources continued, citing market statistics.
TPCA disclosed that of the world's top-10 automotive PCB suppliers, four are based in Taiwan, namely Chin Poon Industrial, Unimicron, Tripod Technology, Unimicron and Dynamic Electronics, all set to embrace a new round of lucrative business opportunities resulting from constant technology advancements and booming proliferation of new EV models and sales.
TPCA stressed that through continuous investments in advanced technologies and capacity expansions, Taiwan makers will sustain their leaderships in the global PCB industry and will continue to benefit from ever-growing HPC, EV and LEO (low-Earth orbit) applications.
Total investments by Taiwan's PCB players are estimated to reach NT$130-140 billion (US$4.33-4.66 billion) in 2022, including Unimicron's NT$45.3 billion, followed by Zhen Ding Technology's NT$30 billion, and over NT$10 billion each for Nan Ya and Kinsus, according to TPCA.