The market value of flexible printed circuit boards continues to grow

In 2013, the market value of global flexible printed circuit boards (FPCB) reached US$11,321 million, which represented a year-on-year growth of 9.4%. It is expected that the market value of FPCB in 2014 and 2015 will reach US$12.008 billion and US$126.86 billion, respectively.

Flexible printed circuit boards are mainly used in displays (LCD panels and touch screens), computers (hard disks and optical disks) and communications (mobile phones). In 2013, the use of FPCB in computers accounted for 25%, of which 80% were Japanese companies, but this market is gradually shrinking. As for mobile phones and tablet PCs, only high-quality suppliers such as Samsung, Apple, LG, Sony, HTC and Nokia use FPCB, while other suppliers replace FPCB with flexible flat cables or ordinary connectors.

Samsung and Apple's FPCB purchases accounted for more than 50% of the global FPCB market. In 2013, the most significant change in the FPCB industry was the sharp decline in the profitability of the older players, while the profits of the newcomers soared. The old experts' equipment and technology R&D capabilities lag behind the newcomers. After a high starting point and early difficulties, the newcomers' profit rate increased significantly. In addition, due to the fact that most of the old manufacturers’ production bases are located in mainland China, the appreciation of the renminbi and rising workers’ costs are also one of the reasons for the sharp decline in profits.

For the first time since the establishment of Mektron, the largest FPCB company in the world, there have been losses for the first time. There are three main reasons. First, the hard disk and optical disc market shrink; Second, Mektron begins intervention in the price war; Third, Mektron produces 45% of its output from China. , The appreciation of the renminbi and the rise in workers' costs have reduced profits. Therefore, Mektron decided to increase Taiwan's production. Panasonic invested more than US$100 million in building a new FPCB base in Taiwan.

Interflex, Korea’s largest FPCB company, saw its gross profit margin drop by nearly 50% in 2013, and its operating profit margin also dropped significantly from 6.2% to 1.2%. The only US-based FPCB company, MFLEX, has its manufacturing base in mainland China and recorded its first loss. Fast-growing companies such as Flexcom and BHflex have moved their main production bases to Vietnam.

ZDT, which is owned by Hon Hai Group, has a significant increase in its gross profit margin, thanks to its parent company's advantage of obtaining more orders from Apple. ZDT's main production base is located in Shenzhen and has also transferred some of its production to low-cost areas: its second largest base is located in Qinhuangdao, and the third base is in Huai'an.