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PCB performance are expected to exceed expectations in the second half of 2022

PCB-performanceare-expected-to-exceed-the-expectations-of-second-half-of-2022

Demand for automotive PCB applications continues to increase

PCB printed circuit board is an important electronic component and the support body of electronic components. Its downstream applications cover communication (35%), automobile (16%), etc. Automotive electronic PCB is expected to release broad development space.

Among them, automotive PCB is used in control system, video and audio system, GPS module, etc. With the continuous improvement of automotive electronization, automotive PCB application demand will continue to increase.

automobile-electronization
As of July 2019, the value of a single PCB for low, mid-range and premium cars is $30-40, $50-70 and $100-150, respectively. Driven by the new four modernization of automobiles in the future, the value of bicycles is expected to be significantly improved, driving the continuous growth of the overall market size.

The global scale of VMR is expected to reach 12.48 billion dollars in 2028, with a compound growth rate of 5.30% from 2020 to 2028

PCB demand growth drives by client side

From the perspective of development trend, the new four modernizations of automobile promote PCB demand significantly increased, and the stability of upstream price drives the development of the industry.

The new four modernizations of automobile are electrification, network, intelligence and sharing. Electrification refers to the field of new energy power system; Intelligent refers to unmanned driving or driving assistance subsystem; Networking refers to the layout of the Internet of vehicles; Sharing refers to car sharing and mobile travel.

Although the “New Four modernizations” in the automobile industry are still relatively unfamiliar to us, they have indeed come to us and will have a great impact on our future life style.

new-four-modernization

From the consumer’s point of view, when you are worried about fuel cars, electric cars have frequently appeared in front of you; When you feel bored driving every day and the traffic is tiring, the Internet of vehicles and autonomous driving are coming.

From the government level, it needs to be responsible for sustainable development, constantly optimize the top-level design, and ensure the healthy development of the industry.

As a result, emission standards are becoming more and more stringent. The sixth national standard is faster and more restrictive than previous standards. Public transport pioneered the use of energy vehicles. Cities have begun to build driverless test zones, and various policies have been introduced to encourage car companies to innovate.

INTERNET-PLUS

With this positioning, coupled with the bottleneck of the traditional fuel car market, Internet Plus has penetrated into various fields. Standing at the level of car enterprises, it is no longer just selling cars, but developing toward the goal of the new four modernizations.

Let’s look at the client side. Historically, automotive electronics accounted for the cost of the vehicle continued to grow, and the trend will continue. Among them, the automotive electronics of new energy vehicles account for 65%, which is significantly higher than that of fuel vehicles. The continuous improvement of automotive electronic applications will drive the demand growth of its basic components-PCB

Intelligence

The first is intelligence. In terms of intelligent driving, the penetration rate of ADAS is gradually increasing, and most of the sensor schemes are 1V1R. However, it is expected that the promotion of automatic driving above L3 level will drive the increase of the number of sensors (L5 requires 32), and significantly drive the growth of PCB used in sensors.

In addition, the application of 77GHz millimeter wave will enhance the requirements for PCB, and further promote the value of single-vehicle PCB. The ADAS sensor PCB market is forecast to grow at a CAGR of 35.9% to reach RMB 46.09 billion during 2021-2025.

Cockpit

In the cockpit, industry research predicts that the average number of screens will grow from 1.62 in 2019 to 2.66 in 2025, and will move to more than 14 inches. The assembly volume of LCD meters increased 44.5% year on year in the first three quarters of 2021, and 10.0-12 inch LCD meters will also become the mainstream application in the future. Automotive displays contain PCB, and the increasing number of applications will drive the demand for PCB.

cockpit

Network

And then the network. It is predicted that the global penetration rate of connected vehicles will reach 24% in 2022, and the penetration rate of T-box is expected to rise rapidly from 50% in 2020 to 85% in 2025. The T-Box/ vehicular communication module is based on PCB development, and it is expected that the scale of PCB related to the Internet of vehicles will reach 922 million RMB in 2025

Electrification

And then there’s electrification. In the new energy electronic control system, PCB is mainly used in VCU, MCU and BMS. At present, the obvious application scenario is FPC instead of traditional wiring harness, which has the advantages of highly integrated, automated assembly, etc., and Nuggets power battery PACK application.

At the same time, FPC manufacturers extend CCS products to expand application scenarios in the battery field. According to estimates, the total market size of FPC+CCS will reach 35.527 billion yuan in 2025, and the market of 10 billion yuan will be launched.

PCB demand growth drives by supply side

On the supply side, the upstream copper clad PCB occupies about 30% of the overall cost, and the price of copper and epoxy resin greatly affects the PCB cost.

At present, the K-bar chart of LME copper price and epoxy resin price in March shows that raw material prices have stabilized or fallen, which is expected to ease the pressure of PCB manufacturers. In addition, Chinese PCB manufacturers have expanded production to cope with future demand.

chart-of-LME-copper

Pacific Securities believes that since April, the LME copper spot settlement price has been falling, and the pressure on the copper clad plate and PCB enterprises for more than a year has gradually eased the cost of raw materials, so although the overall PCB demand boom in the second quarter has also declined, two offset, the performance of the overall plate is expected to exceed market expectations.

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