In 2011, China's electric components market failed to continue the popular market in 2010. At the same time, the rising labor costs have also made the electric and thermal components industry worse and the market competition has become more fierce. The sales price of products has been difficult to increase and corporate profits have begun to decline.
The demand was not as expected in interviews with reporters. The heads of most electric-thermal component manufacturing companies believe that the 2011 market was not as hot as the previous year, and market demand remained stable.
“Originally I thought that the factory's production will be overtime and busy this year. However, we did not expect that the order status did not meet the expectations of the beginning of the year.†Marketing Manager, Hangzhou Hehe Electric Co., Ltd Zhang Liang told reporters that after the Spring Festival in 2011, the overall market demand fell. “And the factory in 2011 was sometimes very busy, and sometimes it was quite busy. The order quantity was not stable.â€
Zhang Guoqing, the chief producer of electric components for small household appliances, also said: "Our order quantity is fairly stable this year, but I have heard that some manufacturers of electric components have had insufficient orders."
Jiang Zhiping, Jiangsu Power Generation Thermal Material Co., Ltd. also believes that the market for electric heating components has been saturated in 2011. Compared with 2010, the overall market demand has not changed much. According to him, the company's sales are almost the same as last year. The related personnel of Jintian Heating Products Co., Ltd. also stated that the market demand in 2011 was the same as last year.
Some industry insiders believe that the reason why market demand is not as expected in 2011 is that, on the one hand, market demand in developed countries has slowed down. On the other hand, the stimulating effect of policies such as the implementation of home appliances to the countryside and trade-in replacements on the domestic market began to weaken.
Although the recent global economic situation is not optimistic, Zhang Mingfang, general manager of Shenzhen Longfengsheng Machinery Manufacturing Co., Ltd., said that the demand for electrothermal components at home and abroad will not be reduced. “Electrical heating components are mainly used in home appliances such as small household appliances, washing machines, and air conditioners, and these products have strong rigidity requirements.â€
In addition, Lu Jiji, China sales manager of Synex Electric Co., Ltd., also optimistically believes that the growth potential of the Chinese home appliance market is still huge. Taking electric kettles as an example, sales in foreign countries increase by only 4% year-on-year, while sales in the Chinese market can double in 3 to 5 years.
Zhenjiang Dongfang Electrothermal Technology Co., Ltd. pointed out in its prospectus that since 2010, the air-conditioning industry has maintained rapid growth. It is conservatively estimated that the average growth rate of the air-conditioning industry will remain at around 10% in the next five years. At present, the annual demand for air-conditioner-assisted electric heaters is approximately 16 million sets of air-conditioning auxiliary electric heaters for electric air-conditioning cabinets, 12 million sets of electric air-conditioning auxiliary heaters for wall-mounted air conditioners, and PTCs for wall-mounted air conditioners. 28 million sets of auxiliary electric heaters for air conditioners. After 5 years, if the proportion of existing product structures is maintained and the air-conditioning industry grows at an average annual rate of 10%, the market capacity of the auxiliary electric heaters for air conditioners will increase to use electricity for cabinets. There are 25.77 million sets of electric heating heaters, 19.33 million sets of electric heaters for wall-mounted air conditioners, and 45.09 million sets of PTC electric heaters for wall-mounted air conditioners.
According to the reporter's understanding, based on the prospects for the future of electric components market prospects, in 2011 some electric components companies are still increasing their production scale. Zhang Liang believes that in order to maintain its own advantages in the fierce market competition, the output of enterprises still needs to continue to increase. "In 2011, Hehe Electric increased the production line of electric components for washing machines. It is expected that the overall production and sales scale will increase by 30% year-on-year, and will continue to increase the scale of production in the future."
Zhenjiang Dongfang Electrothermal Technology Co., Ltd., which was just listed this year, has also raised funds to build electric heaters (tubes) for home appliances and 6 million ceramic PTC heaters.
After the completion of these two projects, each year will add 2.5 million sets of air-conditioning electric heater components, small appliances and other daily electric heating elements 6 million, ceramic PTC electric heater 6 million.
Difficult increase in cost increase prices In 2011, there was no significant change in the cost of major raw materials in the electric components industry. It is understood that the main raw materials for electric components are stainless steel, crystalline magnesium oxide powder, and a few products use copper.
“In recent years, the price of copper has risen sharply. Although it has declined in recent years, it is still at a high level. Many of our products that originally used copper as raw materials have all been transformed into stainless steel. For example, copper cups used in electric cups used to be produced in the past. Due to the increase in cost, the price of copper electric components has risen to that of stainless steel disc-type heating components, and disc-type heating components have the advantage of being aesthetically pleasing and have also been recognized by consumers. Electric components are gradually being replaced." Zhang Guoqing said.
In 2011, except for copper, the prices of other major raw materials in electric heating components did not change much. “The price of major raw materials rose slightly at the beginning of the year, but it dropped somewhat in the middle of the year,†said Zhang Liang. Jiang Zhiping believes that the overall decline in stainless steel prices in 2011, and crystalline magnesium oxide powder prices have changed little in the past three years.
In interviews, most companies believe that in recent years, corporate cost growth has come more from labor costs. The relevant person of the electrothermal components company in Jiangsu and Zhejiang Province said: “Now our lowest wage is 1300 yuan per month. Fortunately, customers can understand the difficulties of the company this year. We rarely ask for price cuts. We also maintain the price of the main product unchanged. Individual product prices have increased slightly, but even so, corporate profits are still much lower than in the past."
Regarding future price trends, relevant personnel of electrothermal components companies stated that despite the fact that labor costs are all rising, competition in the electrothermal components market is still fierce, and it is difficult to increase prices when raw material prices have not changed significantly.
The demand was not as expected in interviews with reporters. The heads of most electric-thermal component manufacturing companies believe that the 2011 market was not as hot as the previous year, and market demand remained stable.
“Originally I thought that the factory's production will be overtime and busy this year. However, we did not expect that the order status did not meet the expectations of the beginning of the year.†Marketing Manager, Hangzhou Hehe Electric Co., Ltd Zhang Liang told reporters that after the Spring Festival in 2011, the overall market demand fell. “And the factory in 2011 was sometimes very busy, and sometimes it was quite busy. The order quantity was not stable.â€
Zhang Guoqing, the chief producer of electric components for small household appliances, also said: "Our order quantity is fairly stable this year, but I have heard that some manufacturers of electric components have had insufficient orders."
Jiang Zhiping, Jiangsu Power Generation Thermal Material Co., Ltd. also believes that the market for electric heating components has been saturated in 2011. Compared with 2010, the overall market demand has not changed much. According to him, the company's sales are almost the same as last year. The related personnel of Jintian Heating Products Co., Ltd. also stated that the market demand in 2011 was the same as last year.
Some industry insiders believe that the reason why market demand is not as expected in 2011 is that, on the one hand, market demand in developed countries has slowed down. On the other hand, the stimulating effect of policies such as the implementation of home appliances to the countryside and trade-in replacements on the domestic market began to weaken.
Although the recent global economic situation is not optimistic, Zhang Mingfang, general manager of Shenzhen Longfengsheng Machinery Manufacturing Co., Ltd., said that the demand for electrothermal components at home and abroad will not be reduced. “Electrical heating components are mainly used in home appliances such as small household appliances, washing machines, and air conditioners, and these products have strong rigidity requirements.â€
In addition, Lu Jiji, China sales manager of Synex Electric Co., Ltd., also optimistically believes that the growth potential of the Chinese home appliance market is still huge. Taking electric kettles as an example, sales in foreign countries increase by only 4% year-on-year, while sales in the Chinese market can double in 3 to 5 years.
Zhenjiang Dongfang Electrothermal Technology Co., Ltd. pointed out in its prospectus that since 2010, the air-conditioning industry has maintained rapid growth. It is conservatively estimated that the average growth rate of the air-conditioning industry will remain at around 10% in the next five years. At present, the annual demand for air-conditioner-assisted electric heaters is approximately 16 million sets of air-conditioning auxiliary electric heaters for electric air-conditioning cabinets, 12 million sets of electric air-conditioning auxiliary heaters for wall-mounted air conditioners, and PTCs for wall-mounted air conditioners. 28 million sets of auxiliary electric heaters for air conditioners. After 5 years, if the proportion of existing product structures is maintained and the air-conditioning industry grows at an average annual rate of 10%, the market capacity of the auxiliary electric heaters for air conditioners will increase to use electricity for cabinets. There are 25.77 million sets of electric heating heaters, 19.33 million sets of electric heaters for wall-mounted air conditioners, and 45.09 million sets of PTC electric heaters for wall-mounted air conditioners.
According to the reporter's understanding, based on the prospects for the future of electric components market prospects, in 2011 some electric components companies are still increasing their production scale. Zhang Liang believes that in order to maintain its own advantages in the fierce market competition, the output of enterprises still needs to continue to increase. "In 2011, Hehe Electric increased the production line of electric components for washing machines. It is expected that the overall production and sales scale will increase by 30% year-on-year, and will continue to increase the scale of production in the future."
Zhenjiang Dongfang Electrothermal Technology Co., Ltd., which was just listed this year, has also raised funds to build electric heaters (tubes) for home appliances and 6 million ceramic PTC heaters.
After the completion of these two projects, each year will add 2.5 million sets of air-conditioning electric heater components, small appliances and other daily electric heating elements 6 million, ceramic PTC electric heater 6 million.
Difficult increase in cost increase prices In 2011, there was no significant change in the cost of major raw materials in the electric components industry. It is understood that the main raw materials for electric components are stainless steel, crystalline magnesium oxide powder, and a few products use copper.
“In recent years, the price of copper has risen sharply. Although it has declined in recent years, it is still at a high level. Many of our products that originally used copper as raw materials have all been transformed into stainless steel. For example, copper cups used in electric cups used to be produced in the past. Due to the increase in cost, the price of copper electric components has risen to that of stainless steel disc-type heating components, and disc-type heating components have the advantage of being aesthetically pleasing and have also been recognized by consumers. Electric components are gradually being replaced." Zhang Guoqing said.
In 2011, except for copper, the prices of other major raw materials in electric heating components did not change much. “The price of major raw materials rose slightly at the beginning of the year, but it dropped somewhat in the middle of the year,†said Zhang Liang. Jiang Zhiping believes that the overall decline in stainless steel prices in 2011, and crystalline magnesium oxide powder prices have changed little in the past three years.
In interviews, most companies believe that in recent years, corporate cost growth has come more from labor costs. The relevant person of the electrothermal components company in Jiangsu and Zhejiang Province said: “Now our lowest wage is 1300 yuan per month. Fortunately, customers can understand the difficulties of the company this year. We rarely ask for price cuts. We also maintain the price of the main product unchanged. Individual product prices have increased slightly, but even so, corporate profits are still much lower than in the past."
Regarding future price trends, relevant personnel of electrothermal components companies stated that despite the fact that labor costs are all rising, competition in the electrothermal components market is still fierce, and it is difficult to increase prices when raw material prices have not changed significantly.
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