HKPCA: South China Market Summary


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Excerpts from HKPCA Presentation, By Ivy Wong, HKPCA Executive Committee Member CLICK HERE to watch the video presentation

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Past & Present <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />China

Today, South China is not only an ideal manufacturing hub which attracts many of the world's leading electronics manufacturers, but it is also the gateway to a huge potential electronics market in China. PCB production in China is expected to show a compound annual growth rate of 14% between 2005 - 2010. South China makes up the largest share of the total PCB production in China.

China's International Trade Picture (in U.S.D. $Billions)                Yr                Yr                Yr                YR               

               2000            2001            2002            2003

Impts      249.2           266.1           325.6           438.2

Expts      225.1           243.6           295.2           412.8

                 Yr                Yr                Jan-Sept               2004               2005               2006

Impts      593.3               762                 691.2

Expts      561.2               660.1              581.4

Closing the Gap between Chinese & Foreign Invested Companies

(Currency in thousands of Chinese Yuan, 1000 Yuan = $127.61 USD))                              2001          2003           2004

Foreign Invested   >500          >400            430

Chinese                 >200            325            450

Note: Companies with US 1.28 Billion or more in annual revenue

Regional Distribution of PCB Manufacturing

Americas

2002      $10.9b USD

2005      $5.0b USD

Europe

2002      $6.7b USD

2005      $3.9b USD

Asia

2002   $12.1b USD

2005   $22.1b USD

Japan

2002   $22.3b USD

2005   $9.7b USD

Distribution of PCB Manufacturing in Asia Pacific (Excl. Japan)*                  2000         2005     % Change  '05 WW Share

China         3368         9553       183.6%          23.5%

Taiwan      4510         5446         29.8%          13.4%

S. Korea    2053         4304        109.6%         10.6%

India           NA           4304         NA               0.6%

ROA           2303         1561         11.2%           6.3%

Asia Total 12092       22089        82.7%           54.4%WorldWd  40920       40638                          100.0%

* in billions of USD shipped

ROA = Rest of Asia

Global PCB Production by Broad Area (% of World Wide Share)

                        4L       6L       8-16L  18+L   Mvia   Flex

Americas        1.9       1.3       1.2       0.2      0.2     1.2

Europe            1.7       0.8       0.4       0.1      0.4     4.8

Japan             2.1       1.4       0.9       0.1      2.2      4.8

Asia                34.2    12.3      4.7       0.2       6.5      4.7

World             39,9    15.8      7.3       0.5       9.3     21.2

Top 20 PCB Makers

      2000                              Country

1    Sanmina-SCI                      U.S.

2    Viasystems                        U.S.    

3    CMK                                Japan

4    Ibiden                               Japan

5    Hitachi Group                    Japan

6    Nippon Mektron                 Japan

7    Compeq                            Taiwan

8    Multek                                U.S.

9    Fujitsu                              Japan

10  Tyco PCB                           U.S.    

11  Shinko Electric                  Japan

12  Daeduck                           S. Korea

13  DDI                                     U.S.

14  IBM                                    U.S.

15  Panasonic                         Japan

16  Nanya PCB                       Taiwan

17  Photocircuits                       U.S.

18  Unimicron                         Taiwan

19  SEMCO                            S. Korea

20  WUS                                Taiwan

2005                                                     Country

1          Ibiden                         Japan

2          Nippon Mektron           Japan

3          CMK                           Japan

4          Shinko Electric            Taiwan

5          SEMCO                      S. Korea

6          Unimicron                   Taiwan           

7          Nanya PCB                 Taiwan

8          Young Poong Grp        S. Korea

9          Kingboard PCB           Hong Kong

10        Daeduck Grp               S. Korea

11        Fujikara                      Japan

12        Multek                          U.S.

13        Compeq                      Taiwan

14        Hitachi Chemical         Japan

15        LG Electronics            S. Korea

16        Tripod                         Taiwan

17        Viasystems                  U.S.    

18        Sanmina-SCI                U.S.

19        WUS                          Taiwan

20        AT&S                         Austria

The top 20 PCB makers in China are all foreign investors, as opposed to organic Chinese companies. They account for 51% of the total PCB value in all of China.

Percentage of Production by Application in 2005 

Communication Electronics       27.0%

Automotive                              15.0%

Other Data Processing             14.0%

Mobile Phones                         12.0%

Consumer Electronics                9.0%

Industrial/Instruments                 7.0%

NB                                            8.0%

LCD                                          2.0%

MB                                           3.0%

Military                                      0.3%

Others                                       3.0% 

Common Technology Levels                                           Mode              Best

LW/Spacing - I/L                   4/4                   3/3

LW/Spacing - O/L                 3/3                   3/3

Min Via Size                          4                      3         

(B4 electroplate)

A/R      Blind Via                   0.8:1               1:1

A/R      Through Via               8:1                16:1

SMT Panel-dist mil to mil        3/3              1.5/1.5

Layer Count                           8                      40

Internal Lyr/Thin Capacity      2 mil                2 mil

Panel Size/Lrg Brd               24 x 24           27 x 40          

HDI Build Up Structure         1+N+1             3+N+3

Challenges in South China

* Environmental Health & Safety Issues

* High Labor Turnover

The growing Chinese economy creates more job opportunities for Chinese workers. It has also created a competitive environment where it is difficult to keep trained workers for any length of time. High labor turnover has an especially big impact on South China enterprises, where the economies are more established than in other areas of China. Additionally, the scarcity of skilled, technical labor at intermediate and higher levels of skill negatively impacts production efficiencies.

* For information on current wage labor rates through the regions of Southern China, please view the full presentation.

* Power Shortage    

The Chinese government is speeding up their development of nuclear power generation, wind power and hydro power generation, as well as other renewable engery sources to ease the acute power shortage problem. At present, PCB and other manufacturers struggle with imposed down time by the government with mandatory power cuts during peak time power consumption.

* Tax Policy

Conclusion

  • The economic conditions continue to be strong in China.

  • In the global landscape, business continues to be shifted from the West to the East.

  • Growing demands for Chinese electronics products encourage growth of the PCB market in China.

  • More than 60% of PCB manufacturers in China are located in the South part of China.CLICK HERE to watch the video

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