More than half of the production lines cut orders or postponed them, and the PCB industry was in dire straits in the first half of the year

Written by Fangfang

When robot companies entered the PCB industry a few years ago, they probably didn't expect to encounter a situation like this year.

After more than a decade of rapid development, the development situation of the PCB industry suddenly took a sharp turn for the worse in the first half of 2022.

" This year may be the worst year for the PCB industry in the past 20 years. " A company that has been deeply involved in the PCB industry for many years revealed that many PCB factories were shut down in the first half of the year. "2008 may not be as bad as this year."

As the construction party of production lines, industrial robot companies also quickly felt the coming of the cold - the PCB industry suffered serious order cuts and order delays in the first half of the year, and the performance of industrial robot companies in PCB-related business sectors was generally frustrated.

Attracted by the broad market prospects, in 2020 and 2021, manufacturers such as Jingwang Electronics, Kexiang Co., Ltd., Xiehe Electronics, Chongda Technology, Ultrasonic Electronics, and Shiyun Circuit announced expansion plans to meet market demand.

In 2021, Gaogong Robot conducted a survey on the PCB industry. The mainstream view heard at the time was that the PCB industry is currently in a major cycle of production expansion, and this momentum is expected to continue for 3-5 years .

As the gross profit margin of PCB products continues to decline, the PCB industry must develop by diluting costs through large-scale production and manufacturing and increasing shipments. On this basis, the application of industrial robots has become the only choice.

The bright future is just around the corner. Efort, Wasu Robotics, Estun, Canopus, Astro Robotics, Bokent, Peitian Robotics, Hikvision Robotics ... Whether it is the "old veterans" who have been deeply involved in the PCB industry for many years, or the "young newbies" who are just starting out in the new world, they are all eager to try and are ready to expand their territory and show their prowess in the PCB industry. Some companies have divided the PCB sector and set up a dedicated research department, and some companies have invested heavily in the development of customized special machines.

However, things are unpredictable. After entering 2022, the expansion trend of the PCB industry has suddenly weakened. Some projects have been delayed, while others have been delayed. A robot company said that half of the factories may have stopped production in the first half of the year, and the situation of order cancellation or project delay is very serious .

The statistics from the China Electronic Circuit Industry Association are more intuitive: in the first half of the year, about 80% of projects in the electronic circuit industry slowed down, including PCB manufacturing and copper clad laminate projects. Most projects were delayed within half a year, and some were even delayed for more than one year.

As for the specific share of cuts, no company has disclosed it yet. But judging from the profit data of the 3C sector of various companies in the first half of the year, the situation is not optimistic.

August has passed, and various listed companies in the PCB industry have released their semi-annual reports. Behind the frequent good news of revenue is the reminder of widespread losses.

Statistics from the China Electronic Circuit Industry Association show that in the first half of the year, the total revenue of China's PCB industry was about 150 billion yuan, a year-on-year increase of 10%. Among them, only 10% of the companies achieved performance growth, and nearly 70% of the companies did not make a profit .

The PCB industry is not making money, so it is natural that it is unwilling to launch new projects. So who should bear the blame for not making money?

Under the epidemic, all walks of life are struggling. The semi-annual reports of listed companies in the PCB industry and the semi-annual operation summaries of small and medium-sized enterprises all mentioned the impact of the epidemic. In the first half of 2022, the epidemic broke out in many parts of the country. From procurement, production, logistics to sales, the operation of each link in the PCB industry has been affected to varying degrees by the epidemic control, resulting in delayed delivery of many orders and affecting the profitability of enterprises .

Some PCB companies even complained that due to the impact of the epidemic, some overseas orders were even stopped by customers halfway through, and they have invested in raw materials and labor costs, but have not received any payment.

Some companies also pointed out that the rising cost of raw materials is an important reason for their losses.

However, in response to this view, some industry insiders refuted: " Raw material prices have been falling this year, and there is simply no market demand. "

The PCB industry as a whole presents the characteristics of "cycle + growth". The overall scale and growth of the industry are highly correlated with the prosperity of downstream industries and the demand of end customers.

Against the backdrop of the COVID-19 pandemic and the dramatic fluctuations in the global geopolitical situation, the global macro-economy is facing downward pressure, and the market demand for electronic terminal products is indeed sluggish. Some PCB companies said that delayed delivery and order cancellations are rampant throughout the industry. In the first half of the year, PCB companies' orders were not saturated, and the average capacity utilization rate was only 70%. In areas with severe epidemics, the capacity utilization rate was less than 30%.

Data from Gaogong Robot Industry Research Institute (GGII) shows that the market demand for industrial robots in 3C electronics grew by -12.4% in the first half of the year, with demand being particularly weak in the second quarter, with a growth rate of -24.2% .

The sluggish demand in the downstream market has affected the demand for PCBs, which in turn has slowed down the capacity expansion of PCB manufacturers and caused a sharp decline in the demand and willingness to purchase industrial robots.

"Starting from May, we will work two days and have five days off, or work three days and have four days off." A reader left this comment under an article reporting on the "collapse of a PCB company."

From PCB manufacturers to industrial robot companies, everyone is most concerned about - how long will this last?

Someone said: "Don't think about it, now is the best time for the next few years."

Some people also said that now is the most difficult time and they just need to get through it.

There is no conclusion yet on when it will end. What robot companies can do is to actively adjust themselves.

EFORT has been deeply involved in the PCB industry for many years. Whether it is the large-scale application of single-station industry customized models or the batch application of multi-station connected six-axis robots in the whole factory, EFORT has taken the lead and completed the first set of domestic industrial robots many times. It has the ability to provide one-stop product solutions for the PCB industry.

Xing Gang, director of 3C industry at Efort, believes that the overall capacity of robots in the PCB industry is currently on the rise, the trend of domestic substitution for imports is accelerating, and the distribution of domestic models in the industry has also undergone structural changes. "In terms of the industry situation in the first half of the year, my opinion is that we should turn the industry's 'anxiety' into motivation, continue to pay attention to the development of industry technology and processes, give full play to the comprehensive advantages of localization, and provide more competitive scenario-based products ."

Suo Liyang, general manager of PeiTian Robotics, provided another idea: the universalization of industrial robots . PeiTian Robotics has also launched a special machine for PCB industry applications. The PCB business was affected in the first half of the year, but overall, the impact was not significant. "Because our products are universal industrial robots, no single model will serve only one industry."

There are also companies such as Estun that think in reverse - although the current PCB industry market is not good, the growth trend in the early stage of the outbreak is very impressive . Companies must improve their foresight and plan ahead for sub-sectors that have exploded rapidly in a short period of time , such as the currently popular photovoltaics, lithium batteries , new energy vehicles , etc.