Taiwan Proves Irresistible In Global Chip-Resistor Industry

Taiwan accounts for 45% of the global production of chip resistors, making it No. 1 in the world, according to the Industrial Economics & Knowledge Center (IEK) of Taiwan's Industrial Technology Research Institute (ITRI).

The world's largest manufacturer in the line, Yageo Corp., runs full-process production lines in Kaohsiung, southern Taiwan, and Suzhou, Jiangsu Province in mainland China. The company further solidified its No. 1 position last year by expanding its monthly capacity (at both plants) to a combined 21 million chip resistors. This has helped boost its share of the mainland China market to 40%, up from the previous 35%.

As part of a plan to transform itself into a service provider, Yageo has set up an e-business transaction mechanism that allows all transaction processes (the placing of orders, logistics, customer complaints, after-sales service, etc.) online.

Ta-I Technology Co., a pioneer in Taiwan's resistor industry, doubled its production capacity to 12 billion chip resistors in 2004. About nine billion of the products are from the firm's plant in Taoyuan, northern Taiwan.

Relec Electronics Ltd. Operates chip-resistor plants in Kaohsiung, Taiwan as well as in Shenzhen, Guangdong Province and Kunshan, Jiangsu Province in mainland China. The company turned out about 80 billion chip resistors last year, with 0603 models accounting for 55% and 0402 models 25% of the total. This year, the company says, its shipments of 0402 models will outstrip those of 0603 models.

The IEK reports that Rohm of Japan is expected to supply 14% of global consumption this year, making it No. 2 in the world. Prior to 2000 it was No. 1, but that year the global chip-resistor industry underwent a major change when Yageo absorbed the passive-component business of Royal Philips Electronics of The Netherlands and moved into the top position.

This year, the IEK adds, Japan's Matsushita is expected to supply 13% of the market from a plant in Taiwan and another one each in Singapore and mainland China. KOA and Kamaya are predicted to supply 10% and 7% of the market this year, respectively. Other Japanese suppliers are expected to withdraw from the chip-resistor business because of their inability to compete with their Taiwanese rivals in terms of price and technology.

Share of Global Chip-Resistor Market in 2005

Country or Area	Market Share
Taiwan	45%
Japan	44%
Europe	7%
South Korea	3%

Source: IEK