With demand for smartphones weakening and Apple’s iPhone sales continuing to rise, some smartphone vendors such as HTC, Xiaomi Technology and Asustek Computer have been demanding that their upstream suppliers, including Printed circuit board manufacturing, cut component prices to help reduce their pressure, according to sources from the upstream supply chain.
However, a number of Taiwan-based Multilayer PCB makers with relatively smaller production capacity are planning to stop taking these orders with meager profits and instead will ramp up their shipment ratios for other applications, said the sources.
For example, Xiaomi is reportedly requiring component supplier to reduce their quotes quarter by quarter as shipments from the China-based vendor have been lower than expected, revealed the sources.
Xiaomi and other smartphone vendors thus have been shifting part of their quick turn PCB orders to China-based suppliers which can offer related products at prices much lower than those quoted by Taiwan’s suppliers, said the sources.
Suppliers of other handset parts and components have also seen their orders from the handset sectors being reduced and therefore are developing products for other segments, including servers, telematics devices and IoT applications, revealed the sources.