China’s RFID Card Market to Double to $807 Million in 2017

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China’s RFID card market will nearly double in value and more than double in units in 2017, as government focuses on the futuristic Internet of Things — embedding connectivity and intelligence in everyday objects — and private sector grows, according to Lux Research.

The RFID card/tag market will grow from 894 million units in 2012 to 2.11 billion, with a compound annual growth rate (CAGR) of 19%. In revenue terms, the market will grow to $807 million in 2017, from $454 million in 2012, at a CAGR of 12%.

“So far, government applications account for 22% of the volume and 34% of the revenue, but that is about to change quickly,” said Richard Jun Li, Director of Lux Research.

“With the rise of market-driven applications, there are opportunities for multinationals to leverage China’s RFID growth — speed and identification of the best local partnerships will be critical,” he added.

Here are some of the findings by Lux Research analysts:

■Consumer market is the strongest. Driven mainly by the adoption of RFID tags for anti-counterfeiting, consumer applications will grow the fastest in volume terms — at a CAGR of 38% until 2017. Industrial applications will grow at a 25% rate, while electronic toll collection will be a fast-growing subsector.

■Local OEM players emerging. The rise of Chinese original equipment manufacturer (OEM) suppliers for RFID cards/tags is creating a new industry dynamic. Currently, the top 15 suppliers account for 57% of the Chinese market and are poised for further gains.

■Focus is on fast-growing UHF market. Chinese companies do not have as strong a position in superior UHF chips — which will grow dramatically to become a $236 million market in 2017. However, the clock is ticking for multinational suppliers, as the Chinese government is putting significant resources into developing homemade UHF chips.