Supply and trend of passive components industry in China

Electronic components, integrated circuits and software engineering are the three pillars of the development of electronic information technology, the resistance, capacitance and inductance and chip components and passive components as the main electronic components in the electronic information products plays an indispensable supporting role. At present, China has nearly 1200 passive components manufacturers, mainly in the Pearl River Delta and Yangtze River Delta region. According to data from the China Electronic Components Industry Association (CECA) data show that in 2004 China's resistance / capacitance / inductance component of the total output of 440 billion, is expected in 2005 will grow by 20%, reaching only 528 billion 400 million. In addition, in 2004 China produced a total of about 311 billion pieces of chips, is expected in 2005 will reach 377 billion. The main driving force for the growth of passive components industry comes from the demand of consumer electronics, IT, communications and automotive electronics industry. This article will focus on the four parts of the supply situation and product trends.

Resistance: R & D focus on environmentally friendly products

At present, there are 300-400 companies in mainland China production resistance, most concentrated in the Pearl River Delta region. In 2004, the resistance output was about 210 billion, accounting for about 30% of global output. With the increasing demand for consumer electronics, GPS modules and digital set-top boxes, the mainland's resistance industry will grow steadily, the output will grow further. Production is expected to grow 20% in 2005 to reach more than 252 billion in 2004. Since 2003, the majority of manufacturers have accepted the EU's environmental regulations, so environmentally friendly resistance has become the focus of research and development of the mainland resistance manufacturers, ISO 14001 certification is one of the vane. Guangdong Fenghua hi tech Polytron Technologies Inc in 2002 through the ISO 14001 certification, as the resistor products will be used for automotive products, the company also plans to pass TL 16949 certification.

In order to meet the higher requirements for household appliances, automobiles and other electrical products, Nanjing Kemin electrical equipment factory research and development work focused on reducing the product size, speed and prolong the working life and improve the reliability of the response. On the other hand, some manufacturers focus on the development of carbon resistance and cermet trimmer potentiometer. For example, Xi'an Chuanglian electric science and Technology (Group) Co., Ltd. (CLEC) is actively developing with higher precision, multi finger cermet trimmer potentiometer brush and complete sealing structure. The company is also developing reliability and calibration current for higher carbon resistance. Shun crown electronics (Shenzhen) Co., Ltd. is also focused on the development of high reliability and stable performance of precision resistors. Prices, although rising raw material costs, but is expected to decline 10%. Copper prices have risen by 50%, so the new manufacturers have very few. On the other hand, some manufacturers are improving capacity utilization, to make up for their meager profit margins.

Capacity: 20% market growth

China is the world's largest manufacturer of capacitors, 400-500 home appliance container manufacturers, accounting for about 50% of global production. Manufacturers of passive components in the mainland, about 42% of the production of capacitors. According to CECA, in 2003 the total output of the mainland capacitor reached 185 billion, in 2004 was only 222 billion, is expected in 2005 and in 2006 will maintain a growth rate of 20%, respectively, up to 266 billion and only.

Aluminum electrolytic capacitors, ceramic capacitors and film capacitors in the capacitor mainland accounted for more than 90% of the supply, which accounted for the largest part of aluminum electrolytic capacitor, output in 2004 reached 70 billion, accounting for 40% of global output, sales revenue of about $845 million. Despite the rising cost of raw materials, but from the consumer electronics, IT, telecommunications and automotive industry demand in mainland China capacitor industry growth of 20% is still made in 2004, and manufacturers will continue to implement expansion plans.

Nantong flying capacitor Co., Ltd. plans to increase the annual production capacity of 20% this month, the current monthly output of only 100 million. Haimen three Xin Electronics Co., the current monthly production came to 80 million, capacity utilization rate was 70%. The company plans to add six production lines this year, is expected to increase production by the month of 20 million. Wuxi new peace Electronics Co., the capacity utilization rate has reached 90%, the company has invested $600 thousand to build a 8000 square meters factory, plans to expand production capacity doubled, and the installation of high voltage capacitor production equipment.

In addition to expanding production, mainland manufacturers are also committed to the development of their own capacitor assembly equipment. Different from the other by China's Taiwan or Japan manufacturing production equipment manufacturers, Haimen three Xin electronic gateway is manufacturing winding machine, assembly and casing of their equipment, the company plans for the further development of three CD294 capacitor production equipment. Nantong is also using its own development of high-speed machines to replace the Japanese production of winding machine. Last year, China's mainland manufacturers have encountered the problem of rising raw material costs, especially aluminum and chemical materials used for the production of electrolytes, but the increase in production to help manufacturers improve the price situation. Manufacturers expect prices to remain stable in 2005, and some companies even expect prices to fall by up to 5%.

Inductor: manufacturers focus on improving production and product development

There are about 300 inductors in China, most of which are small and medium sized companies and are concentrated in the eastern and southeastern coastal areas. 2004 local manufacturers of the overall inductance output is 8 billion, an increase of 30% over the year of 2003, is expected to reach 10 billion 400 million in 2005. Local production accounted for 10%-15% of China's passive component industry, accounting for 40% of global output.

The mobile phone industry is the largest demand for inductors, in 2004 consumed 2 billion. However, manufacturers predict automotive applications will become another hot inductor