Taiwan-based printed circuit board (PCB) makers have expedited transferring manufacturing away from China, with several establishing new plants or extending current lines in Southeast Asia, particularly Thailand, Malaysia, and Vietnam.
Industry insiders pointed out that PCBs do not garner the same welcome as semiconductors, due to wastewater issues and because the PCB industry consumes large quantities of energy and water.
Thailand
According to Woranath Khemasiri, secretary general of Southeast Asia and India Business Group at PricewaterhouseCoopers (PwC), Thailand has continued to improve its PCB industry manufacturing value chain by providing investment incentives, such as lower manufacturing costs and stable water supply.
Taiwan-based IC substrate leader Unimicron is expected to invest THB1.26 billion (US$37.01 million) to establish a subsidiary in Thailand as part of a long-term investment. Other Taiwanese PCB supply chain players expanding in Thailand include Compeq Manufacturing, Dynamic Holding, WUS Printed Circuit, Taiwan Union Technology, ITEQ, Taiflex Scientific, and Apex International.
Supply chain players pointed out that Thailand is actively seeking overseas investment. Thailand has also opened to immigrant workers from neighboring countries such as Myanmar. Once the production facilities are established, the biggest challenges will be factory and supply chain material management.
At the end of 2022, the Taiwan Printed Circuit Association (TPCA) held an investment study in Thailand, which mainly focused on the Eastern Economic Corridor (EEC), which includes Chachoengsao, Chonburi, and Rayong.
The TPCA noted that the local supply chain still needs work and the capacity of wastewater plants has yet to be confirmed. In recent years, under the development of ESG sustainability, wastewater discharge standards have increased in Thailand.
Malaysia
Bismaleimide triazine (BT) substrate maker Kinsus Interconnect Technology and PCB maker Global Brands Manufacture (GBM) are expanding their capacity in Malaysia.
Malaysia plays a critical role in the global semiconductor supply chain, according to industry sources, pointing out that nearly 13% of packaging and testing and 7% of semiconductor trade globally passes through Malaysian factories.
More than 50 multinational semiconductor companies have established packaging and testing facilities in Malaysia, including Micron Technology, STMicroelectronics, Infineon, Texas Instruments (TI), and ASE Group. Several International substrate makers, such as AT&S and TTM Technologies, are also expanding local investments.
Vietnam
PCB makers Tripod Technology and Taiwan PCB Techvest (TPT) are both investing in Vietnam.
Industry sources pointed out that Tripod acquired a Japan-based PCB factory in southern Vietnam as part of its new southern layout. The equity transfer is expected to finalize in the near future.
TPT has invested US$10 million to build a factory in northern Vietnam, which is expected to finish construction in 2023. The factory will focus on notebook boards and photovoltaic panel production and is expected to open new production capacity in 2024.
However, industry insiders believe there is a higher risk of anti-Chinese sentiment in Vietnam. Sources say it is worth watching which Taiwanese companies set up in Vietnam.
At present, several major US manufacturers are manufacturing key products in Vietnam. Apple is manufacturing iPads and AirPods in northern Vietnam. Microsoft began shipping Xbox gaming consoles from Ho Chi Minh City in 2022.