PCB | August 30, 2007

US PCB market down in July

IPC has released the July findings from its monthly North American Printed Circuit Board (PCB) Statistical Program. Rigid PCB shipments are down 7.1 percent and bookings are down 1.8 percent in July 2007 from July 2006. Year to date, rigid PCB shipments are down 10.4 percent and bookings are down 14.6 percent.
Compared to the previous month, rigid PCB shipments decreased 17.7 percent and rigid bookings decreased 17.0 percent. The book-to-bill ratio for the North American rigid PCB industry in July 2007 remained above parity at 1.02.

Flexible circuit shipments in July 2007 were down 0.8 percent and bookings were up 24.6 percent compared to July 2006. Year to date, flexible circuit shipments are down 2.1 percent and bookings are up 9.1 percent. Compared to the previous month, flexible circuit shipments decreased 13.7 percent and flex bookings were down 12.8 percent. The North American flexible circuit book-to-bill ratio declined but remained positive at 1.04 in July.

For rigid PCBs and flexible circuits combined, industry shipments in July 2007 decreased 6.7 percent from July 2006, and orders booked decreased 0.5 percent from July 2006. Year to date, combined industry shipments are down 9.9 percent and bookings are down 13.3 percent. Compared to the previous month, combined industry shipments for July 2007 are down 17.5 percent and bookings are down 16.7 percent. The combined (rigid and flex) industry book-to-bill ratio in July 2007 remained above parity at 1.02.

“We are starting to see some signs of a modest recovery in the North American PCB industry," said IPC President Denny McGuirk. “This year's sales are still running behind last year by almost 10 percent, but year-on-year growth rates are improving and backlogs are starting to go up," he added. “Combined with a positive book-to-bill ratio, these are all encouraging signs."

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 88 percent of the current PCB market in North America, according to IPC's World PCB Production and Laminate Market Report for the Year 2006.

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, however, IPC asks survey participants for the percent of their reported shipments that were produced domestically (i.e., in the USA or Canada). In July 2007, 85 percent of total PCB shipments reported were domestically produced. Domestic production accounted for 84 percent of rigid PCB and 97 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 remains constant throughout each calendar year, but may change with the January survey results.
Bare Circuits Versus Assembly.

Flexible circuit sales typically include value-added services such as assembly, in addition to the bare flex circuits. In July, the flexible circuit manufacturers in IPC's survey sample indicated that bare circuits accounted for about 86 percent of their shipment value reported for the month. Assembly and other services make up a large and growing segment of flexible circuit producers' business. This figure is also sensitive to changes in the survey sample, which may occur at the beginning of each calendar year.


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