LONDON – The flex circuit market is expected to grow 8.6% in 2015, extending 2014's gains, according to a new report. 2014 was a bumper year for most flex circuit manufacturers, with output rising 10.5% year-over-year to $12.5 billion, says Reportbuyer.
This year, bulk commodity prices, particularly copper, are plummeting, reducing raw material costs of printed circuit board companies, says the firm. The smartphone market cannot continue its rapid growth, and the tablet PC is in recession, the firm added.
In 2014, revenue and profit margins of all South Korean printed circuit board companies declined. Flexcom's revenue slumped more than 50%, while Interflex's revenue dropped 33%.
Taiwanese and European companies witnessed soaring profit margins, says Reportbuyer. More than half of Japanese companies did not benefit from the depreciation of the yen because they set up production bases overseas, but they still did better than South Korean companies.
In the downstream market, the biggest change in 2014 lay in HDD, which saw the first growth after three consecutive years of decline. Global HDD shipments were 564 million units, up 2.4% from 2013.
HDD will be the mainstream for the next three to five years; HDD shipments are expected to reach 621 million units in 2019. Japanese companies focusing on HDD use in FPCBs performed well in 2014; Nippon Mektron led with revenue growth of 28%, and Nitto's revenue surged 31%.
The SSD price remained high. The tablet PC market decayed, and the laptop computer market recovered to growth after three consecutive years of downturn, says the firm.
The competitiveness of South Korean and American companies weakened significantly. The strong US dollar resulted in MFLEX's revenue falling dramatically, says Reportbuyer. The depreciation of NTD facilitated Taiwanese companies to grow by leaps and bounds.
Meanwhile, Apple’s orders from South Korean companies were down, and Japanese and Taiwanese orders were up. The revenue of Zhen Ding Technology
soared 60% in 2014.