Issue link: https://iconnect007.uberflip.com/i/1473479
28 PCB007 MAGAZINE I JULY 2022 • e Shanghai lockdown • Impact on automotive manufacturing • Impact of the Russia-Ukraine war on manufacturing in Europe • Rapid fall in the demand for PCs and graphics cards • Rapid fall in consumer demand and the decline in the handset market e current consensus for the third quarter is that there will still be some inventory issues to resolve. ere will be price erosion due to competition. Will there be over-supply? at is still uncertain. Maybe the rebound will hap- pen in the fourth quarter? In Chiang's opinion, the forward visibility remains unclear, and it is difficult to make accurate projections. In broad terms, the 2022 market will be "flattish or up slightly," although packaging substrates will remain very strong. So, 2022 does not appear particularly friendly for the PCB market. What About Suppliers? Looking upstream at the equipment and material suppliers supporting the PCB indus- try, the equipment companies benefited sub- stantially in 2021 from the capital expenditure of the major PCB manufacturers, and a lot of the high-end equipment came from Europe. Chiang had some words of warning for European PCB manufacturers: "Be cautious about your compe- tition. Your competitors in China are growing. ey are expanding their market share and con- tinue to upgrade their technical capability." Suppliers of materials, especially rigid lam- inate, had a wonderful year in 2021. All their raw material prices increased, and they suc- cessfully passed on the costs to their custom- ers while maintaining their profit margins. But they anticipated price erosion in 2022, and many of the Chinese and Taiwanese produc- ers are seeing their local currencies depreciat- ing against the U.S. dollar which, in addition to any inventory-related issues, will bring their revenues down. And end-customers facing tre- mendous headwind on their own pricing will pass back pressures to lower prices. Chiang's closing comments were that 2022 will be an interesting year aer the glory days of 2021, with many challenges to be con- fronted. His suggested approach is to aim to maintain relative stability in managing a busi- ness and to work toward finding the best solu- tion to deal with a couple of those challenges at a time. PCB007 Pete Starkey is an I-Connect007 technical editor based in the U.K. with over 45 years' experience in the PCB industry. He is also a Fellow and Council Member of the ICT, an Honorary Fellow of the EIPC, and a member of the European Technical Committee of the SMTA.