Electrical Equipment / Components & Telecoms

The epidemic has brought about hot sales of many electronic products, such as laptops and game consoles. Since the second quarter of last year, the routers used to access the Internet have also seen a significant increase in sales. Recently, there have been reports that the raw materials of network communication products such as routers are in short supply and the supply is tight. What is the fact? Has the price of terminal router products increased?

Router sales increased sharply, and some brands were tightly supplied

In an electronic product store in Beijing Shimao Tianjie, five or six types of routers are on display. Prices range from 300 yuan to 1,000 yuan. The staff told reporters that routers have been selling well since the epidemic last year. In terms of price, router prices have been relatively stable recently compared to electronic products such as TVs and tablets.

The reporter asked multiple e-commerce platforms and learned that thanks to the increased demand for Internet access such as remote office and online entertainment, the sales of routers have been growing since the epidemic last year. At present, a few brands are experiencing tight supply. In addition, the intensity and frequency of platform promotions have been significantly reduced. Some brand owners said that they are preparing for possible shortages in the future.

According to industry insiders, “the amount of network communication exchanges that were originally expected to be reached in the next three to five years seems to have exploded in an instant.” The reporter learned that since April and May last year, router manufacturers have generally been selling well whether they are for domestic or export.

Yu Xiaoqing, deputy general manager of a network communication product company: In terms of sales volume, our turnover last year was approximately US$30 million per month, and this year we were approximately US$35 million per month.

Kunshan, Jiangsu: "Core shortage" burned to router Netcom chip out of stock

Some router brands are experiencing tight supply. Then, what is the reason for the tight supply? How about the current upstream manufacturing of network communication products?

Compal Networks, a Taiwan-funded enterprise located in Kunshan, Jiangsu, is a large-scale network communications manufacturer in the world, and its downstream customers are telecom operators in Europe, America, Asia Pacific and other regions. The person in charge said that since the epidemic, the company's turnover has increased almost month by month, and the company has also recently expanded its production line. However, the current supply of upstream raw materials such as chips is tight, restricting shipments.

The person in charge took the reporter to the company's warehouse, where various raw materials and chips were placed. The person in charge said that the company consumes about 2.3 million chips every month for production, and the current inventory is seriously insufficient, which can only meet the company's production needs for one week.

Usually, the main raw materials of a router are chips, copper, plastics, etc., of which chips account for about half, which is the largest cost component. The reporter visited a number of local Netcom product manufacturers in Kunshan and learned that the recent increase in raw material prices has reduced the profitability of the company.

Reporter Huang Yajie: I have a home router that is about to be completed. There are a total of eight chips on the entire motherboard. One of the core chips, the purchase price has risen by 15% from the second quarter of last year to now.

Chen Chaowei, raw material procurement manager of a network communication product company: The entire delivery period of chips has been extended, and the delivery period of some chips and materials has reached one year or more.

Kunshan Customs told reporters that the concentration of local electronic product companies has a large demand for chips, and the shortage of chips began in the second quarter of last year. Whether it is automotive, consumer electronics, or network communications, chip supply is generally tight. The import of chips presents the new characteristics of fewer batches and more batches.

Yang Fangming, Director of Kunshan Customs, affiliated to Nanjing Customs: A centralized inspection center has been set up to ensure that chips and other raw materials that are in short supply can be inspected and released quickly, and the efficiency has been tripled. In the first quarter of this year, Kunshan imported 17.9 billion yuan in chips, an increase of 20%.

According to customs data, in April, my country imported approximately 214.9 billion yuan of integrated circuits, a year-on-year increase of 13%; from January to April, the total import of integrated circuits was 822.2 billion yuan, a year-on-year increase of 19%.