Pinsheng Electronics Co.,Ltd
Determined in 2018, materials such as PCB upstream materials, semiconductor upstream material silicon wafers, dynamic random access memory (DRAM) and passive components, metal oxide semiconductor field effect transistors (MOSFETs), microcontrollers ( MCU) and other materials and components, this year is still the year of shortage and price. Under the double pressure of environmental protection and rising raw materials prices, many large PCB factories began to gradually choose price increases. Some uncompetitive enterprises began to withdraw, and the competitive landscape gradually tilted toward large factories with bargaining power, environmental protection indicators and capacity reserves, leading to an increase in industry concentration.
Environmental protection and raw materials double pressure PCB factory helpless
With the continuous improvement of technology, PCB, which is known as the "mother of electronic products", has become a global industry with an annual output value of more than 50 billion US dollars. The importance of PCB to electronic products is self-evident, but the serious environmental pollution problems brought about by the production process cannot be ignored. Especially in the current ecological and environmental problems, green environmental protection has been highly valued by the government. Strict production environmental standards. In order to respond to the government's call to achieve sustainable development of the industry, major PCB manufacturers have made industrial adjustments and improved product manufacturing processes, which not only directly increased the price of accessories and labor costs, but also led to an increase in industry concentration.
At the same time, the rising prices of raw materials have also pushed the PCB companies out of breath. The data shows that the cost of PCB raw materials accounts for about 33%, of which CCL accounts for 18% to 20%. Copper foil is the most important raw material for the production of CCL, accounting for about 30% of the cost of CCL. ) and 50% (thin board). Due to the shortage of copper foil, the prices of various raw materials continue to rise. From the beginning of 2016 to the present, PCB standard copper foil prices have risen by more than 50%, and copper foil processing fees and effective CCL prices are higher than the original average. 100% and 50%.
Under the double pressure of environmental protection and rising raw materials prices, many large PCB factories began to gradually "head down" and chose to increase prices. It is understood that from the end of 2017 in Kunshan, Jiangsu, to Zhuhai, Shanghai, and then Shenzhen, the entire PCB industry will usher in a new situation after this wave of price increases, the overall expected range of 20 -30%.
The 5G era is coming, PCB has strong bargaining power for downstream
From the perspective of the entire environment of the electronics industry, as China gradually enters the 5G era, consumer electronics faces a new round of development, and the demand for high-frequency high-speed copper clad laminates will increase exponentially. At the same time, the reshuffle of small and medium-sized PCB companies will lead to overall capacity. Compression, large manufacturers generally put future capacity in the communications, lithium batteries and automotive blue ocean market, which has a great impact on the downstream enterprises of PCB.
The sharp rise in upstream PCB prices is bound to make the downstream application side unprepared. At this stage, the multi-domain market downstream of the PCB continues to rise, and the continuous market orders not only bring profits to the manufacturers, but also raise higher market demand for the PCB. The increase in PCB prices and the intensification of industry concentration have not only brought cost pressure to downstream enterprises, but also broke the original balance between supply and demand, which led to the market being in short supply.
It is worth mentioning that, due to the tight delivery and shortage of raw materials such as copper foil and glass cloth, the most upstream raw materials of PCB boards, it naturally affects the delivery date of PCB suppliers, compared with the price increase of raw materials. The tight schedule is to let the upstream and downstream manufacturers do nothing. The storm of raw material price hikes began to gradually retreat to those downstream enterprises that have no competitive strength in terms of economy and scale, and further accelerate the reshuffle of the industry.
Get rid of the "price war"
All in all, whether it is a PCB company or a downstream manufacturer, they all face a common situation – before the price of raw materials rises, and after the new market demand of tens of billions, enterprises need to think about the long-term development of the company. Don't succumb to the price of the product, but also exert its strength from its own technology, products, brands and channels to enhance the competitiveness of the company and obtain higher profit margins. The competition in the electronics manufacturing market is still fierce. Some companies with strong competitiveness are beginning to break away from the “price war” and begin to shift the battlefield to the high-end display field.
Copyright © Pinsheng Electronics Co.,Ltd All Rights Reserved.