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IPC - NA Rigid PCB Bookings Up 13.7% in January
February 29, 2008 | IPCEstimated reading time: 3 minutes
IPC -- Association Connecting Electronics Industries' announced today the January 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 are up 5.6 percent and bookings are up 13.7 percent in January 2008 from January 2007. The book-to-bill ratio for the North American rigid PCB industry in January 2008, however, slipped to 0.97.
Flexible circuit shipments in January 2008 were down 17.9 percent and bookings were down 20.9 percent compared to January 2007. The North American flexible circuit book-to-bill ratio declined to 0.96.
For rigid PCBs and flexible circuits combined, industry shipments in January 2008 increased 4.0 percent from January 2007, and orders booked increased 10.9 percent from January 2007. The combined (rigid and flex) industry book-to-bill ratio in January 2008 fell to 0.97.
Every January, IPC opens its monthly statistical programs to new participants, resulting in a slight change in the survey sample. Therefore, January's month-to-month growth rates are not available. Reporting of month-to-month growth rates will resume next month.
"The rigid PCB segment showed strong year-over-year growth in January, which is encouraging," said IPC President Denny McGuirk. "Orders have lagged shipments in both segments of the PCB industry for the past two months, causing book-to-bill ratios to dip slightly below parity, but this should not raise concerns. January is typically a slow month for the industry, and monthly fluctuations like this are normal."
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.
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, however, IPC asks survey participants for the percent of their reported shipments that were produced domestically (i.e., in the USA or Canada). In January 2008, 86 percent of total PCB shipments reported were domestically produced. Domestic production accounted for 85 percent of rigid PCB shipments and 86 percent of flexible circuit shipments in January by IPC's survey participants. These numbers are significantly affected by the mix of companies in IPC's survey sample, which changed slightly in January but will remain 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 January, the flexible circuit manufacturers in IPC's survey sample indicated that bare circuits accounted for about 82 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.
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 three consecutive months or more 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 Interconnect Manufacturing Services (IMS) Business Report each month. Statistics for the previous month are not available until the last week of the following month.
About IPC
IPC (www.IPC.org) is a global trade association based in Bannockburn, Ill., dedicated to the competitive excellence and financial success of its 2,600 member companies which represent all facets of the electronics interconnect industry, including design, printed circuit board manufacturing and electronics assembly. 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 $1.5 trillion global electronics industry. IPC maintains additional offices in Taos, N.M.;Arlington, Va.; Garden Grove, Calif.; Stockholm, Sweden; and Shanghai, China.