Driven by the demand of consumer electronics, computer, communications and automotive electronics industries, the market of electronic information products in China will continue to grow at an average annual rate of about 20% in the next few years. By 2010, the market scale of electronic information products in China will exceed 7 trillion yuan, and the sales of electronic components will account for about 15%. Therefore, the growth space of component market is still enormous. However, with the upgrading of mainstream electronic products, if domestic component suppliers still adhere to the marketing strategy of winning at a low price, it will inevitably lead to the loss of sustained competitiveness, which is a clear signal from CEF that reflects the mainstream demand of Chinese components to the industry.

        As we have learnt from CEF, the price of components made in China is 50% cheaper than that of Japanese products. As for resistors, heaters, connectors and other general components, some of them are even less than 1/10 of that of Japanese manufacturers. It is undeniable that the majority of China's component enterprises still place their survival on equipment and marketing, but they ignore the progress of technology, personnel training and technology development investment. Zhao Weiyang, Secretary-General of Purchasing Branch of China Electronics Enterprise Association and President of China Grid Corporation, said that during the CEF period, the aim was to promote technological innovation in the electronic component industry and improve product quality and service level by holding open forums for leading manufacturers of electronic components in China and selecting leading manufacturers of electronic components. Chen Wenhai, general manager of China Telecom Conference and Exhibition, also believes that the uneven quality of electronic components in China has brought some difficulties to customers' purchasing.

        Taiyo Yuden is the first company developing nickel electrode multilayer ceramic capacitors (MLCC). Now, MLCC has reached the maximum capacity of 100 mF, with a monthly shipment of 17 billion units per month. However, Xiacheng Zhongtong, vice president of the board of directors of Taiyo Yuden (Shanghai), admits that the products of Taiyo Yuden have no advantages in price, but they are in the lead in high-end product technology research and development. Due to capacity constraints, Taiyo Yuden can only give priority to meeting the needs of major customers, while send some of the low-end market to Taiwan, South Korea and Chinese mainland competitors. Xiacheng Zhongtong said that it takes more than 600 manufacturing processes to produce a high-quality capacitor with high capacitance. At present, there are only few manufacturers with such technical strength. For example, for the product specification of 0805, Taiyo Yuden can achieve 22 mF capacitance value, which most of its competitors cannot reach that level at present.

        Due to the continuous growth of production of mobile phones, PC, digital cameras, LCD TV and other products, as well as the rapid increase of the demand for capacitors per unit of some terminal products (such as the demand for 26.4 mF external capacitors based on Intel Dothan single-core platform and 77.2 mF capacitors for Yonah dual-core platform, nearly tripled), at present, there is a shortage of high capacitance ceramic capacitors in the global market. But from the supplier's point of view, capacitor manufacturers that can provide high capacitance value products have not increased, which puts great pressure on existing MLCC capacitor suppliers. As for the upcoming multi-core CPU platform, it is a stimulating demand for the capacitor market, according to Xiacheng.

        However, Zhongtong also points out that MLCC has a development trend of high capacity and low unit consumption. At present, there are about 180 capacitors on the motherboard of mid-end mobile phones in the market (the usage will be further reduced in the future), and the total capacity value is 220 mF (the value will be further increased in the future). This trend will relieve the pressure of MLCC production in a certain process.

        It is gratifying that local suppliers have realized the problem of sustained competitiveness, starting from raw materials to research and development, production and sales so as to build their own new value system. Huawei Group Chang, which specializes in the development and production of aluminium electrolytic capacitors, has entered the purchasing chain of multinational companies such as LG in China with high reliability of products. In order to meet the development needs of miniaturization and ultra-thinning of electronic products, a new chip aluminium electrolytic capacitor production line with world advanced level was built with an investment of 20 million US dollars, and the output in 2005 was 320 million.

        Huawei Group Chang has nearly 300 engineers and technicians. It has a technology development center that independently designs and develops products and an independent routine laboratory approved by the provincial level. There are more than 150 high-speed production lines of fully automatic electrolytic capacitors, with annual production of 4.3 billion aluminum electrolytic capacitors and annual sales of 4.1 billion, of which 45% are exported. In 2006, it ranked 53rd among the top 100 electronic components enterprises in China. Users mainly come from Europe, Hong Kong, South Asia, Taiwan-funded enterprises and well-known domestic manufacturers such as Changhong, Haier, Haixin, Kangjia and TCL.

        Overseas exhibitors accounted for 70% of the Third Asian Electronics Exhibitions (AEES) held in the same period, jointly organized by the well-known electronic exhibition organizing committees of China, Hong Kong and Taiwan, Korea and Japan, also attracted visits from relevant associations in Singapore and Malaysia. Despite being an Asian Electronics Show, IR, an international manufacturer, has made a special appearance on AEES 2006 through Times Technology--its sole agent for power devices in China.

        China's electronic component production has accounted for about 30% of the global total output, and CEF has naturally become the vane of China's passive component and discrete device market.