China‘s output to hit the 1-billion mark in 2006

Posted : October 06, 2006

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Hosonic, mainland China, offers surface-mount crystal oscillators in ultra-miniature 3.2x2.5mm size



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Japan‘s market lead is slowly being eroded by South Korea, Taiwan and major mainland China suppliers as mainland production is expected to climb higher in 2007.
The China Electronic Components Association (CECA) has estimated worldwide crystal components production value at $3.8 billion in 2005. Although Japan is still the leading source of these devices, clinching up to 70 percent of the world market, mainland China, Taiwan and Hong Kong contribute collectively to the sustained growth of the overall industry.
Between 2006 and 2007, CECA forecasts mainland China‘s crystal components production volume to climb up at least 9 percent. The mainland‘s annual capacity for crystal components is at least 5 billion, CECA reports.
Estimates from the Industrial Economics and Knowledge Center (IEK), on the other hand, pegs Taiwan‘s production to represent about 10 percent of total global shipments. Crystal components produced in the island are likely to be worth $431.25 million by end-2006, according to IEK.
The surface-mount crystal components market used to be dominated by Japan makers, but South Korea and Taiwan suppliers have caught in the last five years, with large-scale suppliers on the mainland China recently following suit.
At a projected annual growth rate of over 20 percent, surface-mount crystal components production from mainland China suppliers is expected to hit the 1-billion mark in 2006. Of the estimated 200 crystal components suppliers on the mainland, 40 specialize in the manufacture of surface-mount crystal components. The majority are based in Shenzhen, Yantai, Jinhua, Taishan, Langfang and Beijing. Encouraged by broadening applications in wireless communication, portable digital electronics and automotive products, up to 15 makers are expected to enter the line yearly.
Some 70 percent of the surface-mount crystal components suppliers are private enterprises or state-owned. Thirty percent of them are joint ventures or foreign-owned, including the five largest Japan-owned companies that have set up offshore production bases on the mainland.
In Taiwan, the crystal components industry is composed of more than 20 manufacturers, some of which are engaged in surface-mount crystal components production. TXC Corp., Harmony Electronics Corp. and Siward Co. Ltd are among the suppliers with the highest production values. These makers say they have an edge over Japan-based makers, with better cost control and closer proximity to allied electronics production centers.
Continued downsizing of surface-mount crystal component-related end-products is dictating product development trends. Hong Kong makers concur that surface-mount devices will soon lead the line, and many makers, including Abundance Ent. Co. and Hooray (Hong Kong) Co. Ltd are producing more surface-mount crystal components and decreasing their output of through-hole models.
CECA forecasts that mainland China alone will have produced 1.5 billion to 2 billion units ofsurface-mount crystal components by 2010.
Suppliers on the mainland manufacture mostly surface-mount clock oscillators, VCXOs and crystal resonators widely used in telecom products, PCs and peripherals, home and in-vehicle electronics, and industrial machinery. Taiwan suppliers offer both surface-mount and DIP models. For most, over 80 percent of production is taken up by surface-mount crystal components, mostly for communications and consumer electronics products, but a growing percentage is for automotive applications. Surface-mount crystal components represent between 60 percent and 70 percent of Hong Kong suppliers‘ production. These devices are typically used in high-end mobile phones, Bluetooth products and notebook PCs.
WLAN equipment and A/V products are also the leading production drivers for Hong Kong manufacturers. The upturn in demand for MP3 players is expected to strengthen the surface-mount crystal components segment in Hong Kong in the coming years.

Note: All price quotes in this report are in US dollars unless otherwise specified. FOB prices were provided by the companies interviewed only as reference prices at the time of interview and may have changed.

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