TAIWAN’S ELECTRONICS MARKET CONTINUES TO SOAR Mansi Gandhi
The face of Taiwan’s electronics industry is changing. In the past, the island nation, with the same population size as Australia, has focused on original equipment manufacturing and original design manufacturing. The focus is now shifting towards a more service-oriented electronics industry.
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he business leaders and governments of the world’s largest electronics exporter believe that continued wealth generation requires a new industrial model that is less dependent on primary energy and material inputs. This change in strategy was evident at Taitronics, the electronics show that featured over 500 exhibitors and attracted around 45,000 people from over 90 countries. Some of the buzzwords at the show were the Internet of Things (IoT), wearable electronics, smart home and cloud technology, e-commerce and green electronics. The nation’s IC design industry is adjusting and adapting to global trends - the country’s most important product line is gradually shifting from chipsets for smartphone and tablets to the IoT, according to Taiwan’s non-profit research and development organisation Industrial Technology Research Institute (ITRI) and Industrial Economics & Knowledge Center. “Currently, the advanced process is 32 and 28 nm, and it is moving toward 20 nm. The chipsets for smart handheld devices are still the largest component of the industry’s top line, but 4G and cloud will continue to drive demand growth for mobile device and wearables.” The nation’s IC design industry is expected to generate a turnover of NT$557.5 billion this year, up 15.9% from 2013. Taiwan is still the world’s largest producer of tablets, but the growth momentum is expected to weaken because of the lower demand. The local companies, therefore, intend to strengthen investment in components and improve manufacturing capabilities. Taiwan’s tablet industry
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is expected to achieve revenue of NT$928.6bn this year. The other key market that the nation’s electronics businesses intend to tap into is wearable devices. The hardware architecture of wearable devices is similar to smart handheld and IoT devices and Taiwan’s OEM/ODMs are hoping to get a bigger piece of this market over the next few years. The local suppliers have already launched components, including microprocessors/baseband, sensors, displays and batteries for the wearables market. Similarly, local device manufacturers have introduced smart glasses, smart watches, clothes and bands. Green electronics is also a big focus. A number of new products are launched each year, leaving behind a large number of unwanted and unused products. “The manufacturing of new products places an enormous burden on the environment. An estimated 80% of the environmental impacts of an electronic product are determined in the design phase from the consumption of energy and other resources, such as water to waste generation and the release of hazardous substances. The resource consumption associated with creating a new electronic device is far greater than any gains from more efficient design,” according to The Taiwan External Trade Development Council, TAITRA. More than US$1 trillion a year is expected to be generated globally by 2025 and 100,000 new jobs created over the next five years, if companies encourage the building up of circular supply chains to increase the rate of recycling, re-use and remanufacturing, according to TAITRA.
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