Why the global supply chain still depends on China for advanced circuit boards
Over the past year, I‘ve heard the same question from many overseas customers: “Will your production be affected by U.S.-China tensions? Should we move orders to Vietnam or Mexico?“
My answer has always been consistent: The concentration of PCB manufacturing in China is the result of three decades of market-driven choices. Leaving China is easy; finding a true replacement for China‘s PCB industry is nearly impossible.
1. The Capacity Anchor: Why PCB Production Won‘t Move Out of China
Output and market share continue to grow
In 2025, mainland China‘s PCB output value grew 22.3% year‑on‑year to $34.18 billion, raising its global market share from 34.9% in 2024 to 37.6%. When including Taiwan and Hong Kong, China‘s overall share of global PCB output has exceeded 75%, and in high‑end PCBs it accounts for more than 95%.
Domestic PCB capacity reached about 2.35 billion square meters in 2025, with capacity utilization at 92.8% – a global share of 45.6%. In short: China is not only the world‘s largest PCB producer; its share is still expanding.
Unmatched supply chain depth
After 30 years of accumulation, China has built a complete, locally sourced supply chain: copper clad laminate, prepreg, copper foil, glass fiber cloth, and specialized chemicals. For key upstream materials, Shengyi Technology‘s self‑sufficiency rate for high‑frequency and high‑speed copper clad laminates already exceeds 80%.
In high‑end segments – multilayer boards, HDI, IC substrates, high‑frequency and high‑speed boards – China‘s share soared from over 90% in 2024 to more than 95% in 2025. In niche areas such as 2.5D/3D packaging substrates, 112Gbps server boards, and automotive‑grade HDI, Chinese companies have even achieved technological leadership. This end‑to‑end capability – from materials to finished boards – cannot be replicated by any single country within 5‑10 years.
Sustained cost advantages
Labor costs for Chinese PCB manufacturers are only one‑quarter to one‑third of those in the U.S. or Taiwan. In a labor‑intensive industry like electronics manufacturing, this gap is decisive. Seven of the world‘s top ten PCB manufacturers are now Chinese – a result of integrated supply chains that make “China cost” very hard to beat.
2. Tariffs Have Been Stacked – But Do Customers Really Pay?
A series of tariff hikes
Over the past two years, the U.S. has imposed multiple layers of tariffs on Chinese PCBs, creating a stacked tariff system:
In addition, the de minimis exemption (for shipments under $800) has been eliminated, further raising the import cost for small PCB orders.
The U.S. has also tightened controls on transshipment through third countries. In early 2025, a “transshipment identification tariff” was announced for Chinese‑origin electronics shipped via Vietnam, Thailand, and Mexico – closing the loophole that many companies had used to bypass direct duties.
Has the market logic really changed?
Despite the tariffs, China‘s PCB exports to the U.S. grew 30% year‑on‑year in the first three quarters of 2025, with the share of high‑end PCBs rising from 45% to 55%. Leading manufacturers such as Wus Printed Circuit and Shennan Circuits reported order backlogs of 8‑10 months – record highs.
Why? PCBs typically account for only 8‑12% of a finished product‘s BOM cost. Even a 50‑100% tariff has far less impact on total product cost than the risk of supply chain disruption. Moreover, PCBs from other regions cost 10‑20% more, and their capacity and supporting ecosystems are still immature – delivery speed and reliability often fall short.
3. “China + 1” Means Adding a Backup, Not Replacing China
+1 is a contingency, not a replacement
The “China + 1” strategy that many customers now adopt is essentially about keeping core production in China while building additional backup capacity in places like Southeast Asia or Mexico. The goal is not to replace China, but to diversify risk and increase supply chain flexibility.
Southeast Asian capacity is still nascent
Thailand is currently the top destination for PCB relocation, with more than 60 PCB manufacturers having set up operations there. However, Chinese‑invested factories in Thailand currently account for only about 1.7% of total output – most are still in the ramping‑up stage.
Meanwhile, 57% of surveyed companies said that moving capacity out of China is their biggest current challenge. In the short term, no country can fully replace China’s PCB production base.
4. How Geopolitical Risks Are Driving Up PCB Costs
Chip export controls hit semiconductor packaging demand
The U.S. has raised Section 301 tariffs on Chinese semiconductors from 25% to 50%. All semiconductor devices that are packaged or manufactured in China are now subject to this tariff, directly impacting PCB assembly operations that involve domestically packaged chips.
Middle East conflict disrupts key raw materials
In early 2026, a shutdown of a Saudi plant that supplies about 70% of the world‘s high‑purity polyphenylene ether (PPE) resin sent shockwaves through the supply chain. Lead times for key chemicals such as epoxy resins have stretched from 3 weeks to 15 weeks. Copper foil prices have risen 30% in 2026 alone, and copper accounts for roughly 60% of PCB raw material costs.
Under these multiple shocks, PCB prices surged up to 40% in April 2026 compared to March. Goldman Sachs forecasts that PCB demand will outpace supply for years to come, and the global PCB market is expected to grow 12.5% to $95.8 billion in 2026.
5. Key Takeaways for PCB Buyers
- China remains an irreplaceable base for high‑end PCBs. No other country can match its capacity, technology, or cost in the short to medium term.
- “China + 1” is not “ex-China.” Building backup capacity in Thailand or Vietnam adds options – it does not replace China.
- Tariff costs are already being partially passed on to U.S. buyers. China‘s indispensable role in high‑end PCBs gives it strong pricing power.
- Global geopolitical risks are raising costs across the entire PCB industry. Building long‑term relationships with trusted suppliers and planning backup options will be key to securing supply in the coming years.
Final Thoughts
The U.S.-China rivalry has made the PCB supply chain more diversified and more complex. But it has not changed the fundamental fact that the world looks to China for PCBs.
China‘s PCB industry today is characterised by continued concentration of capacity, accelerating high‑end migration, and steadily growing exports – tariffs are rising, but so is demand, and the latter is offsetting the former.
Perhaps the eventual outcome is not “de‑China” but “even more dependent on China.”
This article is contributed by AnyPCBA, a China‑based PCB manufacturer focused on small‑to‑medium volume production.
No matter how the international situation evolves, we are committed to providing reliable PCB fabrication and assembly services for hardware teams worldwide – with stable quality, transparent pricing, and on‑time delivery.
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