Taiwan’s PCB output remains robust as AI demand drives growth, despite cautious capital spending. The Taiwan Printed Circuit Association (TPCA) revealed on Wednesday that while investment tightens for a third consecutive year, production continues to thrive due to rising needs from AI and electronics sectors.
Capital spending in the printed circuit board (PCB) industry peaked at NT$128.2 billion (US$4.4 billion) in 2022. This surge followed a post-pandemic expansion and a global shortage of Ajinomoto Build-Up Film, a vital chip packaging material. However, since then, companies shifted focus to high-end production lines and expanded into Southeast Asia. This shift responds to geopolitical tensions and the need for supply chain diversification.
Looking ahead, the TPCA forecasts capital expenditure to drop to NT$81 billion in 2024. This reduction reflects a more conservative investment approach. The association emphasized that the industry is entering a phase of resource optimization. In fact, softer demand and inventory buildup in 2023 motivated companies to recalibrate their strategies.
Despite the cautious spending, Taiwan’s PCB output shows resilience. In the first quarter of this year, total production hit NT$205.4 billion, marking a 13.2% year-on-year increase. Computing applications fueled this growth, with a 29.7% jump. The surge mainly comes from high-density interconnect (HDI) boards and multilayer boards used in AI servers and PCs.
Breaking down the figures, multilayer boards reached NT$72.1 billion, up 17.6% from last year. HDI boards climbed 16.1% to NT$42.4 billion, thanks largely to AI and satellite demand. Substrates also saw a full year of growth, rising 13.7% to NT$27.9 billion. Flexible boards increased 7.9% to NT$46.8 billion, supported by recovering smartphone and PC shipments. However, rigid-flex boards fell 6.6% to NT$2.5 billion due to weak sales in high-end phones and camera modules.
TPCA pointed out several challenges ahead, including currency fluctuations and rising costs. Still, the sector stabilizes by focusing on three strategies: high-end manufacturing in Taiwan, mass production in China, and expansion in Southeast Asia. This three-pronged approach aims to mitigate risks and maintain momentum in Taiwan’s PCB output.
In conclusion, Taiwan’s PCB output remains strong as AI demand pushes the industry forward. The mix of strategic investments and geographic diversification positions the sector for continued growth despite global uncertainties.
