China controls 85% of the world's RFID manufacturing capacity as well as being a major exporter of tags. IDTechEx has been studying the global RFID market for the past 15 years, and IDTechEx analyst Dr Xiaoxi He recently looked at over 150 RFID companies both in China and across the world to gauge the health of the industry.
Dr. He’s report found the total value of the RFID market in China was US$1.7 billion in 2014, covering chips, tags (including cards, fobs, labels and all other form factors), readers, and system integration.
Due to strong support by the government, China has used RFID widely on applications ranging from library assets to transportation, and as China becomes a leader in manufacturing in many segments – from cars to planes – it will fuel increasing demand for RFID in manufacturing and many other industries.
The analysis was done based on application sectors, value chain position, frequency band (LF, HF, UHF and MWF) and different regions in China, noted Dr. He.
The forecasts excluded other Internet of Things (IoT) technologies such as sensor networks or wireless telecommunications. It also excluded the non-RFID business of RFID companies and software / services.
The US$1.7 billion figure is expected to rise to US$4.3 billion by 2025. The current value of global RFID tags is US$430 million in 2014, taking about 25% of the total RFID market. IDTechEx expects that to reach US$952 million by 2025.
As RFID is increasingly being deployed around the world, IDTechEx also expects that over 8.5 billion tags will be sold globally in 2015 (versus 7 billion in 2014), with suppliers currently in the process of shaving off fractions of a cent from each inlay, particularly for passive UHF.
This represents a growth of over 21.4 per cent which is in line with recent forecasts from RFID World Canada which has said that between 2013 and 2018, the global sourcing of RFID tags market will grow at a CAGR of approximately 22.4 per cent.
Furthermore noted the Canadian report, Honeywell International, NXP Semiconductors, Alien Technology and Impinj are listed in the report as key players in the global sourcing of RFID Tags market between the years 2014-2018.
According to IDTechEx’s Dr He, there have been new Chinese entrants who, led by strong investment and acquisitions have gained a relatively high market share in the past few years such as Arizon RFID and Shangyang.
Overall, there is rapid progress with RFID in China and much like many other countries, the Chinese RFID industry is mainly led and supported by the government with Chinese government policies playing an important role in the RFID industrial development.