In the first half of 2012, the performance of China's consumer electronics export market was weak

According to a Chinese research report from IHS iSuppli Corporation, the global economic growth rate is lower than expected, which will damage China’s consumer electronics export market in the first half of 2012. Satellite STB, Blu-ray Disc (BD) players, digital cameras and air-conditioners will be sold. Overall decline.

This will be a continuation of the downward trend in the fourth quarter of 2011. Demand for electronic products in Europe and North America is sluggish, which has hit the Chinese electronics export market. Although sales of refrigerators, washing machines, and microwave ovens increased year-on-year, due to their lower semiconductor content, it is difficult for these three types of products to boost overall semiconductor sales.

However, the good news is that as manufacturers reduce their inventory in sales channels, sales in the major export markets that fell in the first half of this year will resume their year-on-year growth in the second half of the year.

Overall, satellite set-top box exports in the first and second quarter of 2012 are expected to decline by 1.7% and 14.3% year-on-year, respectively. The sales volume of Blu-ray Disc (BD) players is expected to decrease by 17.9% year-on-year in the first quarter but increase by 4.4% in the second quarter.

The export of digital cameras in China will also be hit hard. It is expected that exports in the first and second quarter of 2012 will be reduced by 17.5% and 9.9% respectively. However, the hardest hit will be China's air-conditioning exports, which are expected to shrink by 24.6% and 18.0% in the first and second quarters, respectively.

Figure 3 shows the sales of China's export market, broken down by quarter.


The domestic market is also weak The Chinese domestic market also performed weakly in the fourth quarter of 2011. In the sales season of October National Day, most of the equipment manufacturers’ products did not reach sales targets, including digital cameras and microwave ovens. Therefore, Chinese manufacturers reduced their production in the fourth quarter to reduce inventory levels. Due to a single type of product and being forced into a fierce price war, several OEM manufacturers based on the domestic market not only lost sales but also suffered losses.

In addition, the subsidy program for the urban market ended in December 2011. The plan encourages consumers to trade for new products by providing subsidies for home appliances and accelerated the growth of the domestic market in 2009-2011. At the same time, due to the government's failure to introduce new subsidy policies, consumers' willingness to purchase may weaken in the first half of 2012, which has led to a slowdown in sales growth of consumer electronics manufacturers in the domestic market in 2012.

Chip makers were also hit. In the fourth quarter, semiconductor manufacturers’ sales fell sharply in some market segments. For example, some suppliers did not even ship to the air-conditioning market in October and November. One reason is that from 2009 to the first half of 2011, semiconductor supply continued to be tight, and major manufacturers established their own material inventory to ensure normal production.

Another reason is the lack of demand in the air-conditioning market, resulting in excess inventory for manufacturers and sales channels. As a result, some manufacturers stopped the production line to reduce the inventory level, and thus postponed some parts of the non-delivery orders. This means that the major suppliers will not only fail to achieve the sales target for the fourth quarter, and it is also difficult to achieve the full-year target for 2011.

The author Horse Liu is the manager of the Chinese research department at IHS.

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