Chapter 1 Overview of the 3C Automation Equipment Industry

1. Overview

3C automation refers to the process of using automated control machines and systems for production in the 3C (computer, communication, consumer electronics) industry. Due to its high added value and high profit margins, the 3C industry has become one of the first and most widely applied fields of industrial automation in manufacturing.

From the perspective of the industrial chain, the 3C automation equipment manufacturing industry can be divided into three segments: upstream is the key components sub-industry, mainly producing core components such as electronic components, flat displays, and mobile chips; midstream is the 3C automation equipment industry; downstream is the 3C automation equipment application industry, including fields such as computers and mobile phones.

To meet the demand for replacing manual labor, 3C automation systems have high precision requirements and technical difficulties for the required machinery. 3C automation equipment typically integrates mechanical systems, motion systems, electrical control systems, sensing systems, information management systems, as well as cloud computing and big data. In recent years, against the backdrop of rising labor costs and increasing production efficiency requirements, the demand for 3C automation equipment has grown rapidly, and the industry has developed quickly.

Chapter 2 Analysis of the Current Market Situation of the 3C Automation Equipment Industry

1. Market Analysis

China is the world's largest 3C manufacturing base, with an automation equipment market size nearing one trillion yuan. Since Apple launched the first-generation iPhone in 2007 and the first Android phone was born in 2008, the 3C industry, represented by smartphones, has entered a golden development period. According to IDC data, global smartphone shipments rose from 495 million units per year in 2011 to 1.371 billion units per year in 2019, with a CAGR of 14%. The vast market space of the 3C industry has driven the prosperity of upstream manufacturing. In recent years, with a broad consumer market and cheap production factors, China has become the world's largest 3C manufacturing base. For example, in 2019, China's smartphone shipments reached 370 million units, accounting for 27.1% of global smartphone shipments.

In 2019, China's 3C manufacturing industry completed fixed asset investment of approximately 1.7587 trillion yuan. If we estimate that the investment in electronic manufacturing industry equipment accounts for 30%, then the market size of China's 3C equipment in 2019 was about 500 billion yuan. Reports have indicated that Foxconn, which has the highest level of automation in the mobile phone industry, has an automation level of about 30% in the production line for Apple phones. If the national penetration rate of 3C automation equipment is around 10%-20%, the corresponding market space for 3C automation equipment is about 50 billion to 100 billion yuan. In the future, as the penetration rate of automation equipment gradually increases, the market space for automation equipment will also expand.

Currently, the automation rate of production equipment in our country is still at a low level, and the industry penetration has not yet reached saturation. The density of industrial robots, as an important indicator of industrial automation rate, was only 49 units per 10,000 people in 2015 in our country, which still has a significant gap compared to advanced manufacturing countries like Japan, South Korea, and Germany.

The competition in the 3C manufacturing industry is fierce, and the demographic dividend in China is gradually disappearing, driving the industry to increase its automation rate. Currently, most of our 3C production enterprises exist in the form of OEM, producing products with low added value, mainly relying on the comparative advantage of labor, resulting in low profit levels.

Chapter 3 Prospects of the 3C Automation Equipment Industry

1. Relevant Policies

The "14th Five-Year Plan" proposes to "implement the strategy of a strong manufacturing country," aiming to "deeply implement intelligent manufacturing and green manufacturing projects, develop new models of service-oriented manufacturing, and promote the high-end, intelligent, and green development of the manufacturing industry..." The state encourages the upgrading and transformation of the manufacturing industry towards intelligent manufacturing, which helps promote the development of the 3C automation equipment manufacturing industry.

2. Industry Prospects

The 3C manufacturing industry has characteristics such as a large number of workers, repetitive work, and rapid updates. Against the backdrop of China's intelligent manufacturing and the disappearance of the demographic dividend, the urgency for automation upgrades in the 3C industry is increasing. In recent years, although the growth of traditional consumer electronics has slowed, emerging consumer electronics represented by smartphones, tablets, and wearable devices have seen rapid growth. The application of 5G is an important transformation for the smartphone industry, as 5G phones have higher requirements for chip processing capabilities, battery technology, and heat dissipation, necessitating upgrades or replacements of testing and assembly equipment. The 3C automation equipment industry has good development prospects.

With the gradual disappearance of China's demographic dividend, the rising labor costs in manufacturing, and the overall strength of domestic component companies, automation in the 3C industry is the only solution path that can effectively reduce production costs.