TPCA Analyzes New Competitive Landscape of PCB Manufacturing in China, Japan, and South Korea

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The Taiwan Printed Circuit Association (TPCA) and the Industrial Technology Research Institute (ITRI) released the "2025 China PCB Industry Dynamics Observation" and the "2025 Japan and South Korea PCB Industry Observation," providing a comprehensive analysis of the industry changes in the three major PCB producing countries in East Asia under the AI ​​era. The report points out that the demand for AI servers, high-performance computing (HPC), data centers, and electric vehicles is comprehensively reshaping the global PCB industry. China, Japan, and South Korea are pursuing different growth models, and the changing competitive and cooperative relationships will profoundly impact the layout of the Asian electronics supply chain.

China: AI Servers Drive Soaring Output Value, Overseas Capacity Expansion Accelerates.

China is the world's largest PCB producer, with Chinese companies holding approximately 34.9% of the global market share in 2024, generating approximately US$27.95 billion in output value. By 2025, output value is expected to grow to US$34.18 billion, an annual growth rate of 22.3%, and market share will increase to 37.6%, demonstrating explosive growth momentum.

The report analyzes that this strong growth stems from high-end applications such as AI servers, data centers, and new energy vehicles, which has rapidly amplified the demand for high-end HDI and multilayer boards, driving the overall industry to accelerate its upgrade. Although the global geopolitical situation remains uncertain, Chinese mainland manufacturers, supported by policies, markets, and funding, are enhancing their niche through higher-end product portfolios.

It is worth noting that Chinese mainland manufacturers are also actively promoting overseas expansion. Thailand, with its favorable investment environment and well-developed infrastructure, has become the preferred destination for the relocation of production capacity by Chinese mainland PCB manufacturers. Currently, the production value of Chinese-funded PCB factories in Thailand is estimated to account for approximately 1.7% of their total output. Although they may face challenges in the short term, such as rising local labor costs and poor initial yield rates in new factories, in the long run, globalization can effectively mitigate geopolitical risks and bring new customers and increased market share.

Japan: AI Servers Drive Japanese Carrier Boards into a New Expansion Cycle

Japan is the world's third-largest PCB producer, with Japanese companies expected to generate approximately US$11.53 billion in output in 2024, representing a global market share of approximately 14.4%. While the Japanese automotive market faces pressure from low-to-mid-price competition and a sluggish European economy, the overall PCB industry continues its growth momentum driven by strong demand for AI chips and HDD-related applications. The Japanese PCB industry is projected to return to positive growth by 2025, with total domestic and international production value expected to reach US$11.82 billion, and further increase to US$12.35 billion in 2026.

The report indicates that Flexible Printed Circuit Boards (FPCs) are the largest product category in the Japanese PCB industry, accounting for approximately 51.3% of total production value in 2024, while substrates are the second largest, accounting for approximately 29.5%, reflecting the industry's long-standing focus on semiconductors and high-end packaging. With the rapid expansion of the AI ​​server market, demand for ABF (Alternating Current Fabric) and AI chip substrates has also increased significantly, highlighting Japan's leading position in the AI ​​chip substrate field.

Ibiden holds a 70% market share in the AI ​​GPU substrate market; TOPPAN and Kyocera are actively expanding their ABF substrate production capacity through new production lines and advanced equipment to meet the next wave of demand from global cloud service providers and semiconductor manufacturers. Furthermore, Japan not only relies on corporate investment to drive capacity expansion, but also aligns with the government's recent national AI and semiconductor strategies. Through institutionalized subsidies, dedicated funding systems, and supply chain security strategies, Japan strengthens its overall competitiveness in advanced packaging and high-end PCB ecosystems.

South Korea: Server and memory demand drives stable growth, high-end substrates become the core battleground.

South Korea ranks fourth in the global PCB market, with South Korean companies generating approximately US$7.86 billion in domestic and international output in 2024, representing a 9.8% market share. Although the mobile phone and display markets are weak, strong demand for AI servers and memory will enable the South Korean industry to experience stable and moderate growth in 2025 and 2026, with estimated domestic and international output reaching US$7.94 billion and US$8.16 billion respectively.

The report points out that the South Korean PCB industry is highly concentrated in semiconductor applications, with substrates accounting for as much as 45%, highlighting its core advantages in the memory supply chain and semiconductor applications. SEMCO has been expanding its production capacity in recent years, driven by demand for ABF substrates for AI GPUs and server platforms. Simmtech focuses on next-generation memory packaging, developing high-end products such as GDDR7 and SoC-AMM. Daeduck is actively expanding into the high-end substrate market related to AI servers and autonomous driving chips. Korea Circuit's ABF substrate utilization rate has continued to rise with the growth of orders from networking equipment companies such as Broadcom. As for LG Innotek, its substrate business has been mainly affected by the early shipment effect of iPhones, resulting in improved revenue and profit.

In terms of overseas expansion, Korean PCB manufacturers have cultivated the Vietnamese market for many years due to their supply chain with Samsung. For substrates, Malaysia has been the main base for expansion in recent years, actively increasing BT substrate capacity to meet subsequent memory market demand. TPCA analysis suggests that South Korea will continue to play an important role in memory and server platforms, maintaining its strategic position in the global PCB supply chain through high-end substrate technology.

TPCA Observation: Taiwan, at the heart of East Asian competition and cooperation, must simultaneously deepen its technological capabilities and risk mitigation strategies

Driven by AI, China, Japan, and South Korea have each developed representative industrial paths: China continues to increase its global market share through rapid expansion and high-end strategies; Japan cultivates its semiconductor packaging supply chain with advanced substrate technology; and South Korea consolidates its dominant advantages in memory and server fields. These three models are jointly shaping the future competitive landscape of Asia's high-end manufacturing industry.

With the continued rise in demand for AI servers, high-end PCB materials face a supply-demand imbalance. Japanese manufacturers maintain their lead in high-end materials and ABF substrates in terms of process technology, product performance, and quality stability. Their expansion is impacting global AI server delivery times, prompting semiconductor and end-customer companies to recognize the importance of diversifying risks associated with upstream raw materials. TPCA states that Taiwan's semiconductor and PCB industries hold a crucial position in the global AI server supply chain. Facing the changing landscape in Asia, Taiwan needs to accelerate and strengthen its capabilities in advanced packaging technologies and materials self-sufficiency, while simultaneously managing geopolitical and market risks, to maintain its key role in the new supply chain restructuring of the AI ​​era.