Taiwanese suppliers revel in China's cheap smartphone boom

Taiwanese suppliers are experiencing huge growth as a result of surging demand for cheaper smartphones in the Far East with China in particular driving growth in Taiwanese output.

State run Central News Agency quotes figures from the Market Intelligence & Consulting Institute [MIC] as stating that the Integrated Circuit [IC] packaging industry will grow by 7.3 per cent in 2013 to hit a total output value of 373.1 billion TWD [£7.87 billion].

The handset manufacturers set to benefit include Hon Hai Precision Industry, Advanced Semiconductor Engineering [ASE], Kinsus Interconnect Technology, TSC, Chipbond Technology and Siliconware Precision Industries [SPIL], according to ZDNet.

In addition to China’s thirst for cheaper smartphones, the MIC added that Apple’s reliance on Taiwanese suppliers will continue and the iPhone 5C will only serve to back up the confidence many hold in the Taiwanese supplier market. Hon Hai, in particular, will benefit from increased orders for the iPhone 5C and tablets that are expected in the fourth quarter.

When it comes to IC packaging, ASE could increase its sales by as much as 25 per cent in the third quarter thanks to high demand for its Wi-Fi modules that are required by affordable smartphones made for certain unidentified US companies.

Xiaomi, which despite launching in 2011 is already ahead of Apple in China, has been a particular boon for Taiwanese firm Chipbond Technology, with its chip-on-glass [COG] coveted by them and a school of other cheap smartphone manufacturers.

Additionally, SPIL, another Taiwanese firm, is anticipating reporting “record sales” in Q3 of 2013 and in the process surpassing the record set back in Q3 2007.

The Chinese smartphone market saw 88.1 million devices sold in Q2 2013, a number that represents some 20 per cent of all the smartphones shipped across the globe.