China (mainland) – The flexible PCB industry in mainland China has been posting steady growth rates of 60 percent before 2006, due to heavy influx of capital from overseas companies. By the end of 2005, competition has been intense and price fluctuations were frequent, resulting in production growth dropping to 20 percent by early 2006.
The China Printed Circuit Association (CPCA) says that Japan, at present, takes the largest share in global output for flexible PCBs with 28.4 percent, followed by South Korea, 16.5 percent; mainland China, 13.3 percent; and Taiwan, 12.8 percent. The reason that mainland China and Taiwan are behind Japan and South Korea, is that the former regions have been offering low-end products. Japan makers are also setting up off-shore plants in other parts of Asia.
Makers add layers on shrinking PCBs
Taiwan-invested companies on the mainland lead in product development, offering a higher number of layers compared to the majority of mainland-based makers thar are capable of producing rigid-flex PCBs with only up to eight layers. Mainland China's flexible PCB industry is also more focused on supplying the mobile phone market, while Taiwan-invested makers cater to a broader scope of applications—mobile phones, LCD monitors, LCD TVs, laptops, digital cameras, IC drivers for displays, PDPs and hand-held game consoles.
Nevertheless, the rebound of output growth in the mobile phone sector and the flourishing display sector worldwide pushed mainland makers to reinvigorate their production capacities and improve product development. In particular, companies are focusing on high-end flexible PCBs, such as HDI rigid-flex PCBs, of which demand chiefly comes from digital consumer electronics, automotive, instrument and aerospace applications.
Liu Zhiyong, general manager of the FPC Branch of Kinwong Electronic (Shenzhen) Co. Ltd, forecasts that the major trends for flexible PCB development will follow three directions: first, HDI types with line width/space of 38.1µm/38.1µm and diameter of 0.1mm to 0.05mm, which are the requirements for new TFT LCD and PDP models.
The second trend is the adoption of two-layer flexible copper clad laminates (FCCL), which are intended for mobile phones and TFT LCDs. The cost of two-layer FCCL is projected to be cheaper in 2008 onwards.
The third is chip-on-flex (COF) spurred by TFT LCD and IC substrate markets. The COF technology boasts of 10µm and 15µm pitch for single-sided and double-sided flexible PCBs, respectively, and diameter is less than 50µm.
Qiu Xingya, president of Shenzhen Fastprint Circuit Tech Co. Ltd forecasts that HDI rigid-flex PCBs will continue be highlighted in the next few years due to the segment's broad applications. Fastprint began developing and manufacturing HDI rigid-flex PCBs in end-2003. The company uses its own PCB technology and produces rigid-flex PCBs with more than 10 layers. More than half of its HDI rigid-flex PCB output is shipped, and its export sales register almost 100 percent growth every year.
Fastprint plans to establish new product lines, with the first phase of the project to begin production in 2009. The company expects annual output will be 5,000sqm, most of which will cater to the demand from telecom, medical equipment and air-space sectors.
Kinwong agrees that mobile phones, LCDs and digital cameras will be the main growth drivers of flexible PCBs in the country. He notes that more and more mainland makers are focusing on technology development, and are trying to keep up with the level of know-how from their Japan-based counterparts, since raw materials and production equipment for flexible PCBs on the mainland still rely heavily on imports from Japan.
Kinwong began producing flexible PCB in early 2005, and has so far invested over $3.4 million in advanced flexible PCB equipment from Japan and Taiwan. The company's annual capacity for flexible PCBs is 100,000sqm, most of which are double-sided types suitable for LCDs. Its rigid-flex PCBs feature minimum line width/pitch of 60µm, have up to eight layers.
This year, Kinwong intends to increase investment in its flexible PCB production. By end-2008, it forecasts a production value of over $13.5 million for flexible PBCs, of which $2 million will be rigid-flex types.
Note: All price quotes in this report are in US dollars unless otherwise specified. FOB prices were provided by the companies interviewed only as reference prices at the time of interview and may have changed.