Asia leads the way in board production, and the U.S. cements its position at the bottom of the list.

Download this article's accompanying tables in PDF format: Table 1 (World Top 20 PCB Makers in 2000 and 2005), Table 2 (2005 World PCB Output), Table 3 (World PCB Production and Growth).

The PCB output by Asia Pacific countries accounted for more than 80% of global output in 2005. When it comes to laminate consumption, Asia Pacific's share totaled more than 85%.

In 2000, there were seven U.S.-based board makers in the top 20 list, mostly in the top rankings. In 2005, the number had dwindled down to three, mostly in the lower rankings. There will be at least seven makers in 2006 projected to have more than $1 billion in revenue, all located in the Asia Pacific region: Ibiden, Nippon Mektron, CMK, Shinko Electric, Nanya PCB, Unimicron Technology and Samsung Electro-Mechanics, not necessarily in this order.

In this report, we will review from various angles what happened in our industry during 2005, and we will attempt to provide a forecast into the future.

PCB Output and Laminate Consumption in 2005

Global PCB output for 2005 is estimated to have been $42.5 billion, as shown here. (It took the world five years to regain its 2000 output.) If we list the Top 10 producing countries, we find:

Note that there are only two Western-based countries in the Top 10.

Japan comes out ahead of China, but the countries are so close that it is practically a draw. Considering its capacity expansion, however, China will be No. 1 from 2006 on.

On the other hand, 35% of China's output was made by Taiwan board makers, 30% by Hong Kong-based makers, 12% by the Japanese, 12% by U.S. makers, and 3% by European and other Asia-based PCB makers. So in China, board output by "Chinese nationals" was only 8%, assuming the estimate of $10.06 billion is correct.

If overseas production values are considered, the picture of the top board-making "nationals" is slightly different:

At the rate of expansion by Taiwan-based makers in Taiwan and particularly in China, it may not be a surprise if Taiwan overtakes Japan as the No. 1 country some day in the future.

Laminate Consumption

As mentioned briefly before, Asia Pacific consumed 87% of all laminates in 2005. China's consumption reached nearly 46%.

The average layer count of an MLB made in China is estimated to be 5.2 layers. The author finds that 95% of MLBs in China have 4, 6 or 8 layers, of which 85% are 4 and 6 layers. It is estimated that China consumed about 78 million square meters of thin core laminates, which turned into about 52 million square meters of multilayer boards. The production volume of FR-4-based double-sided boards was 25 million square meters. Adding these and the estimated value of composite laminate double-sided boards, the total PTH board production in China is estimated to have been about 81 million square meters. This figure is about 50% of all double-sided and MLSs (outer layer) made in the world.

The World's Top 20

It is interesting to observe that the revenues of the world's Top 20 makers in 2000 and 2005 are similar within the same rankings. The total increased by about $600 million, or about 4%. As mentioned earlier, the seven U.S.-based makers on the list in 2000 held high-ranking positions, but in 2005, there are only three, all in lower rankings. This is in proportion to the decline of U.S. output as a country. The number of Japanese entries stayed the same: seven.

The number of Taiwan makers in the Top 20 increased from four to five, while the number of Korean makers doubled from two to four. There is one entry from Hong Kong and one from Austria in 2005. It is clear that U.S. dominance is a thing of the past. The world has changed.

China continues to be the world's growth leader. However, as mentioned before, the lion's share of growth in China comes from foreign investment, particularly from Taiwan's board makers. The capacity growth in China will be more than 25-30% in the next few years. One often wonders if there is enough market in the world to support such expansion. Despite such worries, PCB makers often expand as if there is no limit to the market. As certain large makers continue to grow in China, some makers will find it difficult to survive in the future.

China's government has been hinting at making tax laws favorable to foreign investors. It promises better electric power supplies in the future, but the industry is skeptical about its promise. It has been tightening environmental laws. Wages are rising; the cost of building is rising also due to the rising cost of labor and building materials such as steel and cement. Everybody believes that the Chinese currency, the yuan, will rise fairly sharply after the 2008 Beijing Olympic Game.

So there will be many negative elements for China's PCB industry to contend with in the future. But at the moment, the largest investment for the PCB industry is still found in China. Many equipment makers who exhibited at the Circuitex Suzhou show in April mentioned that they were booked up with orders for China until the end of October-November. Hence, despite anxiety, China will continue to grow but at the cost of other countries, particularly in volume business.

The hot topic in China today is the effect of rising cost of essential materials. Will PCB makers be able to charge more in accordance with the increasing cost of materials? Well, in this respect, China is not the only country wondering what to do.   PCD&M

Dr. Hayao Nakahara is president of N.T. Information and consulting editor to PCD&M. He can be reached at 631-673-8571; This email address is being protected from spambots. You need JavaScript enabled to view it..