2023 will be difficult for the global PCB industry. The coronavirus pandemic gave the global electronics industry a very strong year in 2021. This strength continued into early 2022, but was then followed by a steady decline that is expected to continue into the first half of 2023.
The outlook for 2023 depends on the duration and depth of this downturn, and a variety of factors are causing volatility and uncertainty.
The electronics industry saw growth of over 12% in 2021 as consumers purchased laptops, tablets, televisions and other electronic devices to work, learn and entertain at home. This was further supported by corresponding investments in communications and computing infrastructure. The global PCB market performed even better with growth of 24%.
Growth remained strong in the first half of 2022, but a marked slowdown has been evident since the third quarter.Consumer demand has weakened, parts of the supply chain are digesting excess inventory, inflation is reducing consumer purchasing power, and the geopolitical environment is creating additional uncertainty.Given the rapid decline in the second half of the year, Prismark expects the global electronic systems market to have contracted by 2.6% in 2022 (in US dollars). The PCB market is expected to perform slightly better with growth of +2.9% compared to 2021, with growth of 23% in the IC package substrates segment (which Prismark counts as part of the PCB market) offsetting a moderate decline in commodity and multilayer boards.
The slowdown is expected to continue into the second quarter of 2023 and possibly longer.The key question will be the timing of the turnaround and the depth of the economic downturn.Assuming a 'soft landing', Prismark expects slight growth of 0.8% in electronic systems in 2023. The PCB market is expected to decline by 2 %, but in the event of a delayed recovery or a more severe recession, growth in 2023 could be much slower.
Some segments of the PCB industry are expected to perform better than others.the IC packaging substrates segment will remain the strongest market segment.however, as the semiconductor market is expected to decline in 2023, this segment will also stagnate at around 0 %.commodity boards are likely to record the sharpest decline of -5 %.Consumer-related end markets are particularly challenging as inflation and rising interest rates reduce disposable income, while non-consumer applications are expected to perform better - including automotive, some industrial and medical applications as well as military/aerospace applications.The outlook therefore remains relatively better for regions such as Europe or America that are less dependent on the supply chains for consumer-related electronics.
About the person
Dr. Shiuh-Kao Chiang is Managing Partner at Prismark Partners, an electronics industry consulting firm based in Cold Spring Harbor, New York. He has four decades of experience in the PCB industry and is responsible for PCB market research at Prismark. He holds a Ph.D. in Materials Science from The Ohio State University.
About the person
Dr. Philip Heinz is a Senior Consultant at Prismark. He works on topics ranging from electronic materials and electromobility to the PCB market. He holds a Ph.D. in Engineering from the Thayer School of Engineering at Dartmouth College.
