Chip Passive Components Industry Report, 2007

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Chip Passive Components Industry Report, 2007

ResearchInChina
Management Report November 2007

Table of Contents

According to the reaction to electric current, circuit groupware can be divided into active components and passive components. The groupware that can enable the execution and treatment of data algorithm are called as active components; likewise, circuit groupware that do not affect basic features of signal and only allow the overpass of signals instead of changing them are named as passive components. Passive components can be generally classified into RCL passive groupware (resistor, inductor and capacitor) and RF passive groupware (wave filter, oscillator).

Compared to RF passive components, RCL has a much bigger market size and has been shaped into a relatively independent industry. The report only studies on RCL passive components. Chip passive components refer to chip components for SMT production line and reflow soldering production line. As usual, chip capacitor refers to MLCC, chip resistor refers to R-CHIP and, chip capacitor refers to L-CHIP.

RCL passive components are basic groupware indispensable to electronic circuit. As usual, RCL takes less than 10% of whole electronic cost. Yet, it is of great importance and belongs to a sort of derived demand. RCL sells quite well in downstream electronic products. When the new-generation products or high-end application is released, the utilized volume of RCL will increase considerably (on circuit design, RCL utilized proportion R: C: L = 1:1:0.5).

Of RCL, the capacitor market is the biggest scaled. And MLCC is the biggest category in the capacitor market. By shipment, Taiwan-based enterprises have strength to compete with Japanese counterparts. However, in terms of sales revenue, Japanese enterprises are still in the leading position. The whole MLCC market is dominated by Murata, TDK and Taiyo Yuden (the three take 65% or so of market shares), of which Murata has a complete product lineup and takes a global market share of 30%. TDK and Taiyo Yuden are specialized in high-capacitance MLCC. Electric components require high stability and low capacitance gap. The Japanese enterprises' preciseness of doing things is acknowledged by most enterprises. Even with the same technical level as Japanese counterparts, Taiwan-based enterprises would still be inferior to Japanese producers in terms of production & quality stability and customer loyalty. Thus, the leading position of Japanese enterprise is unshakable in short run.

In MLCC field, high-capacity is still the most frequently discussed topic, and it probably substitute for partial Tantalum capacitor market. On the one hand, the output of handset, PC, digital camera, LCD TV continues to growth, which greatly drives the increasing demand for MLCC. On the other hand, partial terminal products have a rising requirement on capacitance per unit. Taking PC for instance, Dothan single-core platform of Intel approximately need an external capacitance of 26.4?F or so. Then, Yonah dual-core platform requires total capacitance of 77.2?F. As for 4-core and 8-core CPU platform in the future, the capacitance demands to be up to 160?F and 265?F. This is greatly incentive to the capacitor market. In 2006, the output of X5R and Y5V high-capacity MLCC amounted to 216 billion units and 48 billion units respectively. And the figures will considerably increase to 428.2 billion units and 90.8 billion units separately in 2009, with a respective annual compound growth rate of 25.62% and 23.67%.

R-Chip market is faced with the rising prices. The price of ruthenium raw materials rose by six times within a year. Resistor producers can not fully make up for the rising cost. The world's largest R-chip manufacturer Yageo first announced to raise prices. Besides, Yageo plans to acquire TA-I Technology Co., Ltd. But the latter refused to be purchased. We believe that TA-I will be obtained by Yageo sooner or later. Judging from the gross profit margin rising from 3% to 20% or above after Ralec was purchased by Yageo, it is a good thing to be a member of Yageo.

Number of pages - 81

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