PCB Industry Growth Rates and Book-to-Bill Ratios Announced
Rigid PCB shipments were up 5.1 percent and bookings decreased 10.1 percent in March 2011 from March 2010. Year to date, rigid PCB shipments were up 6.7 percent and bookings declined 8.5 percent. Compared to the previous month, rigid PCB shipments increased 14.9 percent and rigid bookings increased 26.0 percent. The book-to-bill ratio for the North American rigid PCB industry in March 2011 remained at 0.94.
Flexible circuit shipments in March 2011 were up 9.1 percent and bookings declined 7.4 percent compared to March 2010. Year to date, flexible circuit shipments increased 9.3 percent and bookings were up 9.6 percent. Compared to the previous month, flexible circuit shipments increased 15.0 percent and flex bookings decreased 13.2 percent. The North American flexible circuit book-to-bill ratio in March 2011 moderated to 1.04.
For rigid PCBs and flexible circuits combined, industry shipments in March 2011 increased 5.4 percent from March 2010, as orders booked decreased 9.9 percent from March 2010. Year to date, combined industry shipments were up 6.9 percent and bookings were down 7.1 percent. Compared to the previous month, combined industry shipments for March 2011 increased 14.9 percent and bookings increased 21.9 percent. The combined (rigid and flex) industry book-to-bill ratio in March 2011 held steady at 0.95.
"North American PCB sales in March were strong, following normal seasonal patterns, and sales of both rigid PCBs and flexible circuits are still ahead of last year," said IPC President & CEO Denny McGuirk. "Stronger sales than orders is the dynamic keeping the book-to-bill ratio holding slightly below parity, which indicates slowing growth over the next quarter."
The book-to-bill ratios are calculated by dividing the value of orders booked over the past three months by the value of sales billed during the same period from companies in IPC’s survey sample. A ratio of more than 1.00 suggests that current demand is ahead of supply, which is a positive indicator for sales growth over the next two to three months.
Book-to-bill ratios and growth rates for rigid PCBs and flexible circuits combined are heavily affected by the rigid PCB segment. Rigid PCBs represent an estimated 89 percent of the current PCB industry in North America, according to IPC’s World PCB Production Report.
The Role of Domestic Production
IPC's monthly survey of the North American PCB industry tracks bookings and shipments from U.S. and Canadian facilities, which provide indicators of regional demand. These numbers do not measure U.S. and Canadian PCB production. To track regional production trends, IPC asks survey participants for the percent of their reported shipments that were produced domestically (i.e., in the USA or Canada). In March 2011, 83 percent of total PCB shipments reported were domestically produced. Domestic production accounted for 83 percent of rigid PCB and 85 percent of flexible circuit shipments in March by IPC’s survey participants. These numbers are significantly affected by the mix of companies in IPC’s survey sample, which change slightly in January, but are kept constant through the remainder of the year.
Bare Circuits versus Assembly
Flexible circuit sales typically include value-added services such as assembly, in addition to the bare flex circuits. In March, the flexible circuit manufacturers in IPC’s survey sample indicated that bare circuits accounted for about 49 percent of their shipment value reported for the month. Assembly and other services make up a large and growing segment of flexible circuit producers’ businesses. This figure is also sensitive to changes in the survey sample, which may occur at the beginning of each calendar year.
Interpreting the Data
Year-on-year and year-to-date growth rates provide the most meaningful view of industry growth. Month-to-month comparisons should be made with caution as they may reflect cyclical effects. Because bookings tend to be more volatile than shipments, changes in the book-to-bill ratios from month to month may not be significant unless a trend of more than three consecutive months is apparent. It is also important to consider changes in bookings and shipments to understand what is driving changes in the book-to-bill ratio.
The information in IPC's monthly PCB industry statistics is based on data provided by a representative sample of both rigid and flexible PCB manufacturers in the USA and Canada. IPC publishes the PCB Book-to-Bill Ratio and the PCB Statistical Program Report each month. Statistics for the previous month are not available until the last week of the following month.
IPC (http://www.IPC.org) is a global trade association based in Bannockburn, Ill., dedicated to the competitive excellence and financial success of its 2,900 member companies which represent all facets of the electronics industry, including design, printed board manufacturing, electronics assembly and test. As a member-driven organization and leading source for industry standards, training, market research and public policy advocacy, IPC supports programs to meet the needs of an estimated $1.85 trillion global electronics industry. IPC maintains additional offices in Taos, N.M.; Arlington, Va.; Garden Grove, Calif.; Stockholm, Sweden; Moscow, Russia; Bangalore, India; and Shanghai, Shenzhen and Beijing, China.