Red supply chain threatens Taiwan’s electronics industry

Want China Times
Date: 2015-06-26
By: Liu Pei-chen

China’s electronic components and parts industry has been developing by leaps and

The MediaTek HelioX20 chip is unveiled in Taipei, May 12. (File photo/Yen Chien-lung)

The MediaTek HelioX20 chip is unveiled in Taipei, May 12. (File photo/Yen Chien-lung)

bounds in recent years, giving rise to the nickname of the “red supply chain” to be feared by Taiwan’s electronics industry, which accounted for 29.92% of the country’s overall exports in 2014.

As a result, orders for Taiwanese electronic components have begun to decrease from November last year, overshadowing the country’s economic outlook. Taiwan’s IC industry is at the forefront facing the onset of the red supply chain.

Industry insiders note that Taiwanese makers of mobile phone chips and second-tier testing and assembly firms will face especially strong competition from across the Taiwan Strait, as mainland counterparts have slashed their prices thanks to government subsidies. IC producer Spreadtrum, for instance, slashed prices of 3G mobile phone chips by 40% in the first quarter, which in addition to its maturing technological level and service, has enabled it to land orders from domestic and Indian customers, including some first-tier brands. Spreadtrum made considerable gains in market share in the first halfat the expense of MediaTek, Taiwan’s leading fabless IC firm.     [FULL  STORY]

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