At least 30 countries around the world have declared a state of emergency. In addition to the urgent “cities closure” in European and American countries, major manufacturing industries in the world-the Philippines, Malaysia and other Southeast Asian countries have announced closures in succession, which will bring challenges to the supply side of electronic components.
Philippines: MLCC will be closed for 30 days!
Recently, the Philippines announced on the 12th that the capital Manila will be “capped” (community segregation) for 30 days from March 15th. All sea, land and air transportation to and from Manila has been suspended. It is understood that the capital Manila has three of the eight major airports in the Philippines. MLCC capacity may be hit hard.
The Philippines is an important manufacturing base for Japanese and Korean manufacturers MLCC. Murata, Samsung Electronics, and Taiyo Yuden have factories in the Philippines. Murata and Samsung Electronics have 15% and 40% of MLCC production capacity in the Philippines. In addition, the volcanic eruption in the Philippines since January has restricted air transportation, and the industry has concerns over the supply of subsequent MLCCs. According to “International Electronic Business News”, Murata and Samsung Electric’s MLCC are mainly used in high-end markets such as smartphones, automobiles, industry, and medical.
Murata MLCC has a global monthly production capacity of about 150 billion units. Except for Japan and the Philippines (15%), the rest are located in Wuxi, China (40%), Thailand, and Singapore. Samsung ’s MLCC global monthly production capacity is about 100 billion units, except for the Philippines. Apart from 40%, the rest are distributed in Busan (20%) in South Korea and Tianjin (40%) in China. However, it is optimistic that the high-end expansion capacity of MLCC manufacturers in Japan, Taiwan and the mainland will be opened almost at the end of 2019 and 2020, and most of the factories are located in mainland China, which can alleviate the shortage crisis to some extent. Yageo’s MLCC production capacity is very small in Suzhou (70%) in China and in Taiwan, and in Southeast Asia.
Malaysia: resistors stop production for 14 days!
Following the announcement of the closure of the Philippine capital “Manila” for 30 days, Malaysia announced on the 17th that it will close the country for 14 days from March 18 to March 31. The announcement showed that in addition to the necessary livelihood, transportation and public facilities, domestic enterprises and factories have requested a two-week shutdown.
Resistors production is affected!
According to “International Electronic Business Information”, Malaysia is a major manufacturer of resistors for Japanese and Taiwanese enterprises, especially Taiwan resistance manufacturers. Huaxin Technology and Wangquan (a subsidiary of Qilixin) have a large percentage of their resistance production capacity in Malaysia. In addition to resistance products, Japan’s Murata (inductor, MLCC), Nichicon and Nippon Chemicon (aluminum electrolytic capacitors) and Panasonic (solid capacitors) have production capacity in Malaysia.
Xiwangquan mainly produces conventional resistors in Malaysia, and its production capacity accounts for about 50% of its total resistance production capacity, which has a significant impact. However, the current Kunshan and Hunan factories have recovered their operating rates, which can alleviate the shortage problem to a certain extent. Huaxin Technology’s plant in Malaysia mainly produces automotive resistors. The shutdown rate has been fully loaded before the shutdown. It is expected that the shutdown for two weeks will have a greater impact on it. It is expected that the production capacity in other regions will be “relieved”.
In terms of inductors, Japan’s Murata and Chiru have inductor factories in Malaysia, but due to the large number of participants in the global inductor market, the competitive landscape is relatively fragmented and the demand side is weak, “International Electronics Business” judges that its price fluctuations will not be too obvious.
The pandemic impact to passive components can still be mild in overall market situation
The sudden epidemic disrupted the rhythm of the global electronics supply chain. Southeast Asian countries are second to China in the global electronics manufacturing industry. Once affected by the global industry chain, they may face paralysis. However, under the premise that both the demand side and the supply side are stagnant, the magnitude of the shortage will be buffered. Supply chain companies need to pay close attention to industry trends, make good risk predictions, and prepare for “revenge” recovery after the epidemic in the second half of the year!