DVI cable assemblies

	DVI models have nickel- or gold-plated connectors and cable lengths up to 5m.

China’s DVI cable assembly production is losing steam while exports are posting minimal growth. This is due to diminishing applications in the A/V equipment and computer sectors, which are adopting USB, HDMI and DisplayPort standards.

Global shipments of DVI-enabled devices in fact are expected to drop sharply to 3 million by 2011 from 112 million units in 2007, according to In-Stat.

In contrast, products supporting HDMI, which reached 130 million in 2007, will increase 30 percent this year and next.

A similar trend is projected for DisplayPort-compatible equipment, from zero in 2007 to 263.3 million units in 2012, according to iSuppli.

Although DVI delivers high-quality digital transmission, HDMI has the advantage of carrying both audio and

video signals in one cable. The former transfers only the video format so a separate cable for audio is necessary.

HDMI is also faster, which means more information transferred, is physically smaller and has cables that can go up to 15m or longer.

DVI cable length can only reach 8m, otherwise the image quality may not be guaranteed.

HDMI is now the primary connection option for consumer electronics. DisplayPort, which dominates the computer sector, basically has the same advantages.

The DVI line accounts for about 5 percent of China’s total cable assembly output. Production totaled 50 million units in 2008, according to the Connectors and Plugs Branch of the China Electronic Components Industry Association. This represents a YoY decline of 5 to 10 percent.

Makers reported reductions in orders and overseas shipments by as much as 20 and 30 percent, respectively, beginning 2H08 due to the financial crunch.

Suppliers plan to cut DVI cable turnout in light of the shift to USB, HDMI and DisplayPort. For now, however, they are keen to maintain their output in hopes that exports will still recover.

Although total production is forecast to remain at 50 million units, overseas shipments are projected to rise by 6 percent from 35 million units in 2008 to 37 million this year. This trend is expected to continue throughout 2010.

Some large makers have already reported rebounding orders locally and abroad.

The upturn is specifically being fueled by the shift from traditional markets such as Europe and North America, where 70 percent of overseas shipments used to go. Suppliers are now exploring alternative destinations, including the Middle East and Russia, which are expected to drive growth.

Some companies, on the other hand, are turning to the domestic market to offset losses in their foreign business.

China manufacturers are capitalizing on their price advantage and improved service, including shorter turnaround, to sustain orders. Gold Cable Zhongshan Electronics Co. Ltd has cut its lead timeto 25 days from the usual 30 and is marking down quotes by as much as 5 percent.

DVI-D leads production
Industry composition

DVI cable assemblies from China come in three types: DVI-A, DVI-D and DVI-I. The first, which has a similar interface and form as the VGA standard, accounts for a small portion of makers’ total output. The second kind makes up 80 percent of supply, and the last represents 15 to 20 percent.

DVI -D suppor t s only digital connection and is used mostly in A/V devices. Some companies offer this type exclusively.

DVI-I is an integrated cable capable of transmitting both digital and analog signals. Computers are its main application.

HDMI-to-DVI cable assemblies for computers, DVD players and set-top boxes are also available.

Basic specifications include 18+1 or +5, or 24+1 or +5 pins, gold or nickelplated connectors in male or female configuration, 26 to 30AWG cables and shielded or nylon weave. Lengths range from 1 to 5m. Most models comply with UL, VDE, CSA, CCC and RoHS.

A mature product line with shrinking applications, DVI cable assemblies have undergone minimal product development in the past years.

Suppliers direc t R&D toward customers’ requirements on cable length, shielding, connector coating and external design.

The bulk of raw materials and components are purchased locally. The majority of makers prefer to outsource DVI connectors. This eliminates the need to buy the production and testing equipment needed to manufacture the component. There are, however, a few that choose to make these in-house to lessen outsourcing overhead.

Copper is a key determinant in pricing. After an upsurge in 2007, costs dropped in the latter part of 2008, pulling with it DVI cable quotes, which fell by as much as 30 percent.

Material outlay has since stabilized and prices will likely remain unchanged in coming months. Some companies, however, are eyeing a reduction of 5 percent to attract orders.

Mainland China has about 300 DVI cable assembly suppliers that also manufacture other types of cables. Eighty percent of makers are located in Guangdong, Zhejiang and Jiangsu provinces, the top three production centers in the country.

The majority is locally owned. The rest has investment from Taiwan, Hong Kong and other areas in East Asia.

Suppliers export 20 to 90 percent of their output, mostly under OEM and ODM terms.

Large makers produce more than 50,000 DVI cable assemblies per month.

Output of midsize operations ranges from 10,000 to 50,000 units. Small suppliers turn out fewer than 10,000 assemblies monthly. This figure shrinks to 5,000 for some privately owned workshops.

Slowing orders have brought down capacity utilization rates from 80 percent to 60 to 70 for large enterprises, and 50 percent and below for midsize and small operations.

Chaozhou Cisco Development Enterprise Inc. used to run at 90 percent of capacity but is now at 70 percent.

Some companies, mainly small, were less fortunate as they were forced to drop out of the line. Guangdong experienced the most casualties as the majority of small makers are located there. To survive, many suppliers are undertaking several measures to cut overhead. An example is reducing the product defect rate to below 10ppm or even zero. A low rejection rate helps bring down material and labor outlay.