Power distribution units

	Model YGB-030 from Youcheng has dielectric strength of 100Mohm at 500V DC

Production is on an uptrend despite severe competition and looming glut. More makers adopt SMT production.

Mainland China makers offer power plugs, sockets and jacks for all applications in home appliances, consumer electronics and industrial equipment. Home appliances are the biggest application segment, and makers expect demand from this sector to consistently rise by 15 percent.

There are more than 1,000 power plug/socket/jack manufacturers on the mainland. Most of them are either foreign-owned, or Taiwan or Hong Kong companies. To facilitate shipment to local and overseas clients, about two-thirds of suppliers are located in the coastal areas of Guangdong, Jiangsu and Zhejiang, where a large number of electronics manufacturers are also based.

Over the years, the large number of manufacturers has intensified competition and resulted in oversupply. Large-scale makers account for more than 20 percent of total supply from the mainland. Small-scale makers leave the line, but are quickly replaced by new entrants.

Despite the excess supply, most makers continue to expand their output with an aim to offer volume production at much lower prices. Production has maintained growth rates of at least 10 percent.

Power plugs/sockets/jacks are not the sole product line of most makers. Makers also produce other products such as switches and connectors. The proportion of power plugs/sockets/jacks output varies from 10 to 60 percent out of total production. Competition prevents most makers from using their full capacities. Average utilization rate runs at 70 percent. Home appliances and industrial applications absorb the bulk of supply.

Kwanda Industrial Co. Ltd can produce 33 million power plugs and jacks a year. It plans to raise production by 10 percent to realize $11 million sales in 2007, up from $10 million in 2006.

Zhangjiagang Huajue Electronic Co. Ltd, a major connector and switch manufacturer in mainland China, will increase its production by 20 percent in 2008 as it targets sales revenues of $15 million.

Some suppliers plan to set up new manufacturing facilities in the next two years to accommodate additional orders. Zhangjiagang Youcheng Technology & Engine Co. Ltd, one of the major power plugs/sockets/jacks manufacturers on the mainland, recently completed construction of a new facility worth about $400,000.

Youcheng produces 300,000 power plugs/sockets/jacks per month, with annual sales reaching $6.6 million, or 60 percent of total sales. It is moving from semi-automated production to full automation in order to maximize production efficiency. Youcheng recently purchased some new plastic injection machinery and CNC equipment, and plans to import more test equipment.

More makers are expected to adopt SMT manufacturing as surface-mount power plugs/jacks/sockets become more popular. Currently, only 20 to 30 percent of mainland makers have the capability for SMT manufacturing.

Makers improve their products by developing more heatproof and smaller models with sleek designs. Polycarbonate alloy plastic is used to make power plugs/sockets/jacks fire-retardant. Other areas of product development are insulation resistance, and surge, overload, leakage and electric shock protection. Power plugs/sockets/jacks from mainland China makers can typically withstand temperatures up to 60°C.

Makers usually design their products according to the specific needs and requirements of their clients. They also acquire patents for added value. Youcheng, for instance, has 60 patents for its products.

For Kwanda, models with small form factor is a key product development concern. Its smallest surface-mount power jack measures 3.5x3.5mm. Some makers are developing models that can be universally used for power mains in different regions.

Until now, additional production costs are hindering most of these makers from achieving full RoHS compliance. Since most mainland manufacturers cater to the low-end and midrange markets, RoHS-compliant products are supplied when specified by the client.

Meanwhile, companies are exerting more effort to make production lead-free, and obtaining relevant product approvals. Huajie has a series of approvals such as UL, CCEE, CSA, TÜV, VDE, SEMKO, FIMKO, NEMKO and DEMKO. Similarly, Youcheng has UL, CE and TÜV product approvals, among others.

A large portion of power plug/socket/jack output from mainland China is exported. A range of at least 20 to 80 percent of makers’ output is shipped to Europe, the United States, Southeast Asia and the Middle East. OEM and ODM clients account for the majority of export business. Power plug/socket/jacks are usually exported together with finished products.

In the case of Youcheng, all of its output is exported with finished products. However, the company discloses that it targets for more direct exports in the future, particularly for industrial applications in the United States.

Makers are confident to sustain 10 percent export growth in 2008. Kwanda, which has been shipping 20 percent of its output, will raise its shipments by 10 percent. The company aims to expand its market reach to include Russia.

Prices are expected to increase by not more than 10 percent in the coming months to accommodate rising raw material costs. Currently, the price of a low-end wall type power socket is about $10. A midrange product is priced at about $15 and a high-end model, $15 and up.