DALLAS – Continued price declines won't sink the flexible printed circuit market this year, a new report asserts.

RnRMarketResearch.com predicts the worldwide FPC market will reach $12.61 billion, up 4.8% year-over-year. The growth will offset lower prices that have sunk some suppliers, especially in South Korea.

Pricing has been hurt by a large influx of new capacity in South Korea. Many of the domestic firms were dependent on key accounts such as Samsung and LG, making them less competitive during negotiations. Therefore, these vendors cut prices in the fourth quarter of 2013, causing a price war, says the research firm.

Yet Apple isn't to blame for the widespread revenue drop in South Korea, the firm says. Apple did shorten its supply chain, giving more orders to vendors in Taiwan.
The worst-case scenario is South Korea-based Interflex, whose revenue is forecast to drop 50% in 2014 due to the drying up of orders from Apple. A loss of orders also caused M-Flex’s revenue to decline 20% in 2014. Yet the new larger iPhones need more flex boards, leading to big jumps in revenue for fabricators in Taiwan and Japan.

Of the Taiwanese vendors, ZDT generated the most revenue, as the Foxconn subsidiary benefitted from more orders from Apple. It is forecasted that its revenue will jump 55% to $1.52 billion in 2014.

In 2013, the FPC industry brought in some $12 billion, up 16.2% year-over-year, according to RnRMarketResearch.com.

RnRMarketResearch.com projects that growth will slow for smartphones in 2015; tablet PCs will begin to decline, and notebook computers will grow slightly or be flat. Moreover, LCD-TVs are expected to grow by a small margin, and wearable devices are likely to rise significantly, but their application of FPCBs is too small to fuel the market. In 2015, it is more than likely that LCD-TVs will be the mainstay to drive the market. And after six to eight years of popularization, LCD-TVs are expected to undergo a boom. Consumers will choose 4K TVs with higher resolution or replace smaller 32-37" to 40-42" TVs.

RnRMarketResearch.com expects it will be hard for the South Korean vendors to reverse the downtrend when Samsung’s mobile phone shipments slow and its LCD shipments fall. It is more likely that South Korean vendors will suffer a collapse, while the companies from Japan and Taiwan will benefit, says the firm, especially Japanese ones that improved competitiveness after the repeated depreciation of the yen.

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