In terms of product types, the global PCB industry is approaching to the direction of high precision, high density and high reliability, constantly reducing volume, reducing costs, improving performance, lightweight and thin, increasing productivity and reducing pollution, in order to adapt to the development of the downstream electronic equipment industry.
The investment in technology research and development will be further increased. High-speed, high-frequency and high-thermal applications of multilayer boards will continue to expand, and more sophisticated HDI boards and more advanced wafer-level packaging technology will emerge.
Compared with Japan, Korea and other mature areas of PCB industry, China has the advantages of lower labor costs, huge market potential, concentration of downstream industries, land, hydropower, resources and policies, etc. Therefore, PCB industry has realized the transfer from developed countries to China.
Due to the underdevelopment of IC industry, China lags far behind Japan and Korea, which have already formed mature industrial chains in the R&D and manufacturing technology of high-end PCB products, such as packaging substrates, and is still in the stage of technological exploration. Only Meifei Power (Beijing) Co., Ltd., Sun Moonlight Semiconductor (Shanghai) Co., Ltd., Zhuhai Doumen Chao Co., Ltd. Few electronics manufacturers such as Yi Electronics Limited are producing in small quantities. Acceptance of industrial transfer will help Chinese enterprises learn advanced technology, enhance crisis awareness, constantly enhance their competitiveness, and create prosperity.
China's PCB industry faces a major crisis from its competitors. With the disappearance of China's demographic dividend and the maturity of the PCB industry, labor, hydropower and environmental costs will continue to rise, and Southeast Asian countries have attracted a large number of foreign investment through their own cost advantages, especially India, which has a large number of PCB demand. Low end PCB products such as single and double-sided panels, which are low cost and low investment, have been transferred to these countries for the second time.
Removing low-end excess capacity and developing high-tech products is not only the general trend, but also the call for environmental protection. The Environmental Protection Tax Law of the People's Republic of China, which came into effect on January 1, 2018, forced the transformation and upgrading of enterprises with high pollution and energy consumption through tax mechanism, thus promoting the adjustment of economic structure and the transformation of development mode, and strived to establish a mechanism of "enterprises pay more taxes with more rows, less rows and less taxes with less rows", in which environmental protection taxes will be collected as local taxes. In addition, the central government does not participate in the allocation, thus stimulating the supervision of local governments, thus speeding up the withdrawal of high-pollution enterprises, and improving the economic benefits of enterprises with high production efficiency and low pollution emissions.
The government's environmental policy restricts investment in low-end PCB products below the four tiers, which gives high-end products such as HDI more capital investment and a broader market space. According to Prismark's forecast, from 2016 to 2020, the annual composite growth rate of China's packaging substrate output value will reach 5.5% (the global average is only 0.1%).
On the strategic choice of enterprises, some PCB enterprises begin to extend the industrial chain and provide innovative services. The upstream enterprises of PCB industry are more sensitive to the changes of various external factors, and can almost completely transfer the price pressure to the middle of the industrial chain. When the upstream raw material shortage price rises, small and medium-sized PCB enterprises are facing challenges in the stability of the capital chain and supply chain, business risk and competitive pressure intensified.
Because of the high concentration of the upstream enterprises, some large enterprises try to extend into the downstream electronic assembly industry of PCB manufacturing business, realize the integration of production and marketing, develop into multi-industry fields, reduce costs and increase revenue. EMS industry is located in the electronic joint assembly industry, specifically refers to the design of passive devices, active devices, connectors and other electronic components through plug-in, surface mounting, micro-assembly and other means of welding on the PCB board to achieve electrical interconnection, and through functional and reliability testing to form modules, machines or systems. Through the professional services of EMS service providers, the individualized design for a large number of small-batch downstream electronic products enterprises with insufficient economic scale can help the brand manufacturers to complete the mass production with higher efficiency and meet the demand timely.
According to IPC, the income of global electronic EMS services in 2016 amounted to US $446 billion 300 million, an increase of 3.77% over the same period last year. Extension of the product chain helps enterprises to reduce the pressure of rising prices, thus more room to address the impact of various economic and policy factors on enterprises. In addition, due to the diversification of consumer electronics products, the short life cycle, some enterprises began to enter the low volume, high customization of one-stop service areas, small and medium-sized batch PCB manufacturing optimization, to help customers reduce design costs, increase their competitiveness. Shennan Circuit, Xingsen Express, Jesse Technology, Zhuhai Founder and other enterprises have positively laid out one-stop Express board services.
In terms of enterprise scale and industry concentration, the scale of China's PCB enterprises will be further expanded, some backward small and medium-sized enterprises will be eliminated, and most of the production capacity will be concentrated on leading enterprises. According to Prismark data, the concentration of PCB industry in mainland China lags far behind the level of Europe, America, Korea, Japan and Taiwan in China. The concentration of domestic PCB industry and the market share of large factories have great room for improvement.
In terms of industrial layout, China's PCB industry will continue to follow the steps and policies of the government. The government's existing developments include the Pearl River Delta Development Zone in 1994, the Yangtze River Delta Development Zone in 2000, the Bohai Rim Development Zone in 2005 and the West Delta Development Zone in 2010, which was initiated by the central government. After confirming whether market demand can support factors such as plant size, personnel flow and management, overall operating environment, waste water discharge and other licences, a number of enterprises move inland to enjoy preferential policies and factor prices.
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