Aug 28, 2012 IPC — Association Connecting Electronics Industries® announced today the July findings from its monthly North American Printed Circuit Board (PCB) Statistical Program.
PCB Industry Growth Rates and Book-to-Bill Ratios Announced
Rigid PCB shipments were down 4.2 percent in July 2012 from July 2011, and bookings decreased 5.7 percent year over year. Year to date, rigid PCB shipments decreased 5.3 percent and bookings increased 1.1 percent. Compared to the previous month, rigid PCB shipments were down 16.6 percent and rigid bookings declined 18.7 percent. The book-to-bill ratio for the North American rigid PCB industry in July 2012 continued to slip and registered 1.00, exactly at parity.
Flexible circuit shipments in July 2012 were up 15.4 percent, and bookings were down 35.0 percent compared to July 2011. Year to date, flexible circuit shipments decreased 4.2 percent and bookings decreased 7.7 percent. Compared to the previous month, flexible circuit shipments decreased 9.1 percent and flex bookings were down 46.7 percent. The North American flexible circuit book-to-bill ratio dipped to 1.03, due to both strong sales and weak orders for the month.
For rigid PCBs and flexible circuits combined, industry shipments in July 2012 decreased 2.6 percent from July 2011 and orders booked decreased 8.4 percent from July 2011. Year to date, combined industry shipments were down 5.2 percent and bookings were up 0.3 percent. Compared to the previous month, combined industry shipments for July 2012 decreased 16.0 percent and bookings decreased 21.4 percent. The combined (rigid and flex) industry book-to-bill ratio in July 2012 decreased slightly but continued in positive territory at 1.01.
"The sharp declines in North American PCB sales and orders in July over the previous month reflect normal seasonal patterns,” said Sharon Starr, IPC director of market research. “Strong flexible circuit sales in July cushioned the fall. This strong sales performance was not surprising given the high book-to-bill ratios for flex seen in the first half of the year,” she added.
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 90 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 July 2012, 83 percent of total PCB shipments reported by survey participants were domestically produced. Domestic production accounted for 83 percent of rigid PCB and 82 percent of flexible circuit shipments in July 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 flexible circuits. In July, the flexible circuit manufacturers in IPC’s survey sample indicated that bare circuits accounted for about 44 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 and short-term volatility. 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 (www.IPC.org) is a global industry association based in Bannockburn, Ill., dedicated to the competitive excellence and financial success of its 3,100 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 $2.02 trillion global electronics industry. IPC maintains additional offices in Taos, N.M.; Arlington, Va.; Stockholm, Sweden; Moscow, Russia; Bangalore, India; and Shanghai, Shenzhen and Beijing, China.
Editors: See attached PDF charts.
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