Since the second half of last year, affected by factors such as the continued epidemic and the shortage of chips, the consumer electronics industry has ushered in a wave of cutting orders, which has led to a further decline in the market demand for MLCCs, and the market price of MLCCs has returned to the price reduction model. Entering 2022, this situation will continue, but it has eased. The quarterly price reduction in Q1 this year has converged to 3-5%.

At present, the entire industry is very concerned about the future market demand and price trend of MLCC. According to the forecast of Japanese foreign investment, the price decline of MLCC in the second quarter will also converge within 5%.

On the other hand, we found that the number of domestic companies entering the MLCC field is still increasing. Recently, Xinwei Communication said that its MLCC project will be put into production in the second half of the year; the MLCC expansion projects of Fenghua Hi-Tech, Micro Rong and other companies are still going on. So, under the tide of price cuts, what will the future development of MLCC show?

The price is determined by the market and is expected to rebound significantly in the second half of the year

Affected by the sluggish demand for major consumer electronic products such as mobile phones and tablet PCs, a "wave of order cutting" broke out in many areas of the electronics industry in the first quarter of this year. Among them, mobile phone orders were cut more strongly, accounting for about 20%. Following the news of order cutting in the electronics industry, a new wave of order cutting has gradually spread to the PC industry. According to Taiwanese media sources, many first-tier PC brands have begun to lower their annual shipment targets. The overall sales growth of many components has slowed down.

Zhang Hui, Marketing Department of Guangdong Micro-Rong Electronic Technology Co., Ltd. said, "Although more and more large enterprises pay more attention to the long-term stability of the supply chain, the price of MLCC components is still greatly affected by the market supply and demand situation. Influences such as "lack of cores" have hit the entire electronics industry hard, and the demand for many components has been frustrated, and the MLCC market has not been completely spared. Some manufacturers and agents have short-term abnormality due to the company's special needs and inventory management considerations. selling price."

"Relevant forecasts believe that the overall electronics manufacturing industry is expected to rebound significantly in the second half of this year, and the electronic components market will also be boosted by then." Zhang Hui also believes that there are also many uncertainties in the near future, and the industry will be affected by it. have positive or negative effects.

Another industry insider also holds a similar view, "At present, the price of MLCC is still in a downward state." An insider of a distributor also said that due to the sluggish demand for MLCC and the low price, his company has recently turned its main business to the IC field, "We It's been a long time since I followed MLCC."

At present, it seems that the "shopping tide" in the electronics industry may continue into the second quarter. The demand for consumer electronic products is general, and the low-end MLCC inventory is still in the digestion stage, and the oversupply structure will continue to be maintained in the short term.

New energy vehicle boom drives MLCC market expansion

It is worth mentioning that the new energy vehicle market has become a new direction for MLCC applications. According to data from the China Automobile Association, my country's new energy vehicle industry will grow rapidly in 2021, with sales reaching 3.521 million units; the latest forecast data from the Passenger Association shows that the sales of new energy vehicles in 2022 are expected to reach 5.2 million units; In 2025, my country's new energy vehicle sales are expected to approach tens of millions.

With the improvement of the new energy vehicle market, automotive electronics has created a demand for high-capacity MLCCs. Japan's Murata took the lead in shifting its business focus to the automotive MLCC market, and now the overall vehicle regulation market is dominated by Murata. A person familiar with the matter said, "Murata is the automotive MLCC manufacturer with the largest market share in the world; in addition to Japanese manufacturers, among other manufacturers, Samsung Electro-Mechanics also In the development of vehicle-grade MLCCs; the main domestic enterprise Weirong has also entered the vehicle-grade MLCC market including safety products; other companies are also developing and certifying vehicle-grade MLCCs.”

Affected by the previous market boom and strong market demand for vehicle regulations, MLCCs at home and abroad have ushered in a "wave of production expansion", and major manufacturers have expanded production. Among them, the production capacity of domestic companies such as Weirong, Fenghua and Sanhuan has doubled in recent years, and major Japanese companies have also indicated that they will increase the production of MLCC at a rate of about 10% per year.

Industry insiders told the author that in the short term, there will be a new round of competition in the MLCC market. However, the annual growth rate of the entire MLCC market remains at 5% to 10%, and the annual new production capacity is 200 billion to 400 billion pieces; among them, Japanese companies are mainly expanding production in the direction of vehicle regulations, and some consumer MLCCs are There are production cuts, so for the long-term situation of the entire market, the impact of the "expansion wave" will not be too great.

When talking about the competition pattern of new energy vehicle MLCC, the above-mentioned person said, "The penetration rate of new energy vehicle market may reach more than 20% in 2022, and the strong growth momentum of new energy vehicles will bring good expectations to the relevant industry chain. It is expected to greatly promote the explosion of demand for MLCCs.”

Zhang Hui also said that the demand for MLCC bicycles for new energy pure electric vehicles has doubled compared to traditional fuel vehicles.

It is understood that Weirong is a representative enterprise of domestic high-end MLCC. In the field of automotive MLCC, Micro Rong has set up a dedicated automotive research institute, which is the first domestic automotive MLCC company to mass-produce AEC-Q200 standards, and its products can meet the needs of safety automotive electronics. Weirong insists and continues to develop high-end MLCCs such as vehicle gauges and high-capacity MLCCs, constantly breaking through cutting-edge technologies, and gradually realizing the diversified development of MLCCs. The company's performance growth in the past two years will mainly come from the sales volume of high-capacity MLCCs, while the vigorous layout in the automotive industry , will contribute to the magnitude growth of MLCC in the next 2-4 years. Overall, under the tide of new energy vehicles, MLCCs with micro-capacity vehicle specifications are expected to usher in rapid growth.

Under the trend of localization, local manufacturers usher in a period of alternative opportunities

The "Basic Electronic Components Industry Development Action Plan" issued by the Ministry of Industry and Information Technology shows that by 2023, for important industries such as smart terminals, 5G, and the industrial Internet, to promote breakthroughs in basic electronic components, the goal is to reach 2.1 trillion in total sales of electronic components in China. Yuan, to further consolidate my country's status as a global electronic component producer.

At the same time, data from the China Electronic Components Industry Association also shows that the global MLCC market will increase by 11.1% year-on-year in 2020, reaching 101.7 billion yuan, and is expected to reach 149 billion yuan in 2025. Among them, the market size of China's MLCC industry is about 46 billion yuan, accounting for about 45.23% of the world, and it is the largest MLCC market in the world. However, the MLCC self-sufficiency rate of mainland manufacturers is insufficient, with a total share of less than 10%. At present, there is still a large space for domestic substitution.

Industry insiders told Jiwei.com that the current self-sufficiency rate of localization is insufficient. On the one hand, the domestic production started late, and on the other hand, the industry entry threshold is high, and a large amount of capital and technology needs to be invested in the early stage, so the overall domestic power is insufficient in the early stage. Although the scale of the domestic MLCC industry continues to expand, so far, many domestic companies have not yet mastered high-precision technology, and are still in a weak position in the high-end MLCC field.

It is true that in terms of the current market situation, in addition to the efforts of enterprises themselves to realize domestic substitution, the downstream market also plays an important role in the opening level of domestic MLCCs, including increasing the promotion of domestically produced MLCC products and the introduction of domestic suppliers. At present, it seems that the market has maintained a good operating trend, and downstream enterprises are working towards localization.

How should relevant enterprises meet localization needs?

Zhang Hui believes, "With the help of the trend of localization, domestic enterprises may usher in the best growth opportunity to replace domestic MLCCs; but localization is only a short-term 'window', and MLCC products will eventually have to compete in the market. Domestic MLCCs want to To truly enter the market and become the main force in the industry, it is still necessary to cultivate sufficient competitiveness in many aspects such as technology, quality and service, which is also Wei Rong's understanding of the industry and the foothold of the company."