Where is the future incremental market for the PCB industry


Posted December 10, 2021 by kingabc

Where is the future incremental market for the PCB industry
 
Table of Contents

1. PCB industry description

2. Why can’t the pcb electrical industry form a monopoly

3. The future incremental market of the pcb electrical industry



1. PCB industry description
A. PCB Copper clad laminate: it is the base material of the circuit board. The copper clad laminate is composed of glass fiber cloth (glass filament woven), resin, and copper foil.

B.The upstream of the copper clad laminate is copper foil, glass fiber, and resin, and the downstream is the circuit board enterprise.

Copper foil: The downstream of copper foil was almost always used for copper clad laminates. In recent years, new energy vehicles have developed greatly. However, the negative electrode of lithium batteries uses copper foil (graphite is bonded to the copper foil to become the negative electrode), so the downstream demand for copper foil is expanding At the same time, the copper foil production process for lithium batteries is simple, resulting in a higher gross profit margin of lithium battery copper foil than copper clad laminates. Therefore, many copper foil enterprises have transformed their production lines to lithium battery copper foil; coupled with copper price increases; and copper production Foil equipment is imported, and it takes nearly 2 years to expand production after copper foil is in short supply. The superposition of these factors caused the supply of copper foil to exceed supply in mid-2016, which opened the prelude to the price increase of PCB copper clad laminates.

Glass fiber: The fiberglass industry is a monopolistic industry. The world’s top 6 monopolizes 70% of the market, and China Jushi (SH600176) accounts for 21% of the world. Because of the supply-side reform, the price of fiberglass cloth has risen. Jushi’s stock price has increased. Double year

C. Copper clad laminates are also a monopolistic industry, with the world’s top 10 copper clad laminate manufacturers accounting for 73.5%. In comparison, the world’s top ten PCB manufacturers have a market share of 32.21%.

D. Looking at the copper clad laminate industry chain, the upstream fiberglass and copper foil are monopolized. Naturally, if the price rises, the price will increase. I am not afraid that you will not use it in the downstream. The copper clad laminate industry is also monopolized. Naturally, the price of raw materials will rise accordingly. The downstream is not needed. When it comes to the circuit board, it is finished. It is a non-monopoly industry, and many downstream customers of the circuit board are large companies like Huawei ZTE Lenovo (products using circuit boards are also monopolized in large industries). Therefore, the PCB electrical industry is relatively bitter in this industry chain. The upstream PCB copper clad laminate prices increase but they dare not easily increase the downstream prices. Therefore, we can see that the industry has held meetings in the past two years, and the circuit board industry always complains.

The copper clad laminate industry has continued to increase prices since mid-2016, so the gross profit margin of the entire copper clad laminate industry has been increasing in the past two years. This is the wool coming out of the pigs. The copper foil and fiberglass cloth prices increase. In the end, the copper clad laminate companies did not bear the cost at all. Instead, they made more money. Who will bear it?





2. PCB electrical industry description
It is not that PCB has a low threshold, so it cannot form a monopoly. This industry should be similar to the service industry. The industry is completely close to downstream customers for processing services, not a purely productized industry.

The PCB industry looks like a manufacturing industry, but it is actually a service industry. The scale effect is not obvious, so it cannot be monopolized.

Copper clad laminate is a pure manufacturing industry, and the scale effect is more obvious. Therefore, progressive enterprises continue to expand production, and eventually they will have advantages over small ones, thus forming a monopoly in the industry.



3. The future incremental market of the pcb electrical industry
In the future, things will be online after the Internet of Things, and circuit boards will inevitably be needed. After cars are electrified, cars will also need more circuit boards. In short, we need more and more electronic products. Circuit boards are the mother of electronic products, and the demand is sure. It has risen steadily.

A. High frequency and high speed board:

5G: 5G is high-frequency and high-speed, so high-end copper clad laminates are needed. This is an incremental market.

Automobile: In the future, unmanned driving, lidar and the like will also be high-frequency and high-speed equipment, which is also an incremental market.

Internet of Things: This is also a high-frequency and high-speed demand and an incremental market.

Because of the higher electrical performance requirements of high-frequency signals, high-frequency and high-speed substrates with low dielectric constant (Dk) and dielectric loss (Df) are at the top of the value pyramid of PCB copper clad laminates, and the application scenarios are gradually extending from the original defense industry. In the fields of civil communications and automobiles, especially in the 5G era, they are facing explosive growth opportunities. Whether it is the construction of transmitter base stations, automotive millimeter wave radars, consumer electronics and IOT equipment, there are multiple demands for high-frequency and high-speed substrates. , The market size is expected to exceed tens of billions. On the other hand, high-frequency and high-speed substrates have high barriers to entry, placing higher requirements on patent formulations, manufacturing processes, terminal manufacturer certification, and upstream supply chain management capabilities.

B. IC package substrate:

In the chip industry chain, packaging substrates are an important part.

As the main material of IC carrier board, BT board is a very important circuit substrate material technology with excellent performance and is widely used in high-end chip packaging. IC substrate is the core material of integrated circuit packaging, accounting for more than 40% of the packaging cost. From the perspective of IC substrate production cost, the material price accounts for as much as 40% to 50%, and the raw materials are mainly BT resin. At present, my country’s carrier board accounted for only 1.6% of the world in 2014, which is the lowest in the PCB product category, and there is huge room for localized substitution.

https://www.kingfordpcb.com/news_catalog/pcb-bolg//where-is-the-future-incremental-market-f.html
-- END ---
Share Facebook Twitter
Print Friendly and PDF DisclaimerReport Abuse
Contact Email [email protected]
Issued By kingford
Country China
Categories Accounting , Affiliate Program , Architecture
Tags manufacturer , pcb , pcba
Last Updated December 10, 2021