Electronic enthusiast.com reported (Wen / lianghaobin) since the beginning of this year, the demand for consumer electronic terminals has shrunk significantly. From the perspective of the global market, the first quarter of this year, including smartphones, tablet computers, televisions, etc., witnessed a decline in varying degrees. In fact, this reflects the downward trend of the global economy as a whole. Since this year, China has been affected by many rounds of epidemics, and the economic situation is even worse.

Promoting consumption is one of the ways to change the current situation. In order to stimulate the recovery of stable growth in consumption, a number of policies have been introduced recently, including the subsidy for replacing old household appliances with new ones, the subsidy for new energy vehicles, the subsidy for consumer electronics products, and consumer vouchers. Driven by these policies, will the domestic consumer market get better?

Household appliance market has become a disaster area, and consumer MCU bears the brunt

Compared with the global market, the domestic decline is larger. According to the data of counterpoint, the global shipment of smart phones in the first quarter of this year was about 228million, a year-on-year decrease of 7% and a month on month decrease of 12%; In the Chinese market, the sales volume of smart phones in the same period was 74.2 million, a year-on-year decrease of 14%.

The home appliance market is the hardest hit area. In the first quarter of 2022, the global TV shipment volume was 44.9 million units, a year-on-year decrease of 6.1%, and the shipment scale has decreased year-on-year for three consecutive quarters. According to Ovi cloud, the omni channel retail scale of China’s color TV industry in the first quarter of this year was 8.831 million units, a year-on-year decrease of more than 10%, a decrease higher than that of the global market.

Another data is that during the May day home appliance promotion this year, according to the statistics of ovicloud, except for the well-known reasons, the sales of refrigerators increased by 49.3%, the retail sales of other categories decreased significantly compared with the same period last year. Among them, air conditioners dropped by 33.8%, refrigerators by 18.1%, washing machines by 27.3% and clothes dryers by 5.1%.

Fanghongbo, chairman of Midea Group, a leading domestic household appliance company, said in early May this year that the industry will face great difficulties in the next three years, which is an unprecedented cold winter. At the same time, with the weak terminal demand, the price of consumer MCU, which has been improving all the way in the past two years, is falling all the way. This trend began to show some signs as early as the second half of last year. Home appliances account for a high proportion in the application of consumer MCU, including motor control, charger, display driver, smart home and other fields, which are widely used in MCU. The decline in terminal demand will obviously impact the upstream MCU manufacturers first.

Since 2022, no domestic mainstream consumer MCU manufacturers have reported any price increase. The editor learned from many chip dealers that in the past two years, the market panic spread due to the shortage of chips. Many dealers, including terminal factories, are actively hoarding chips, but now the downstream situation is bad, and many dealers are beginning to reduce prices to clear their inventory.

Perhaps it is because we have seen the growth bottleneck of consumer MCU. Domestic manufacturers such as Zhaoyi innovation and Xinwang micro have begun to enter the vehicle MCU market and began to transfer from consumer MCU to vehicle specification MCU products.

Domestic household appliances have entered the peak period of generation replacement. Policies drive consumption and benefit the recycling industry

Although the market situation in the first half of the year was not ideal according to the data, the news of cutting orders from the supply chain also brought more pessimism to the market. On the other hand, this year, China began to enter the peak period of upgrading household appliances. According to the Statistics recently released by the national development and Reform Commission, at present, the number of domestic household appliances has exceeded 2.1 billion, and the elimination rate this year has increased by 20%. It is estimated that the scrap amount will exceed 200million.

This is because during 2008-2013, the state carried out policies such as “home appliances to the countryside” and “old appliances for new” to promote the purchase or renewal of a large number of home appliances. It has been about 10 years since today, and most of the products have reached or exceeded the safe service life.

On March 19 this year, Zhengzhou took the lead in launching the activity of exchanging old household appliances for new ones in China. Until June 30, when consumers participated in the activity, they could enjoy a 20% subsidy of the actual transaction price (not less than 1000 yuan, excluding the recycling discount of old household appliances and the merchant discount) of a single piece of new household appliances. The maximum subsidy for each unit was not more than 500 yuan.

Under the continuous downward pressure of the economy, in May, various policies to promote consumption, including trade in and consumption subsidies, are starting to be launched in many places. For example, Chongqing has launched a series of policies to exchange old appliances for new ones to benefit the people, including the issuance of consumer coupons, discounts, full reduction plus gifts, etc. the transaction price of old appliances for new appliances is further reduced by 10%, with a maximum subsidy of 4999 yuan. After the May Day holiday in Guizhou Province, many places in the province have also introduced policies such as home appliances going to the countryside and exchanging the old for the new. The old home appliances can be worth 100-500 yuan.

The actual effect is also obvious. According to Suning Tesco, only its stores in Zhengzhou City completed a total of 15000 old and new units from March 19 to May 22, with a conversion amount of nearly 54million.

So where did the recycled old household appliances go? A key news recently is that the general office of the national development and Reform Commission, the general office of the Ministry of industry and information technology and the general office of the Ministry of ecological environment jointly issued a notice to determine that Haier, Gree, TCL, Changhong, Midea and Hisense will carry out the 2022 recycling target responsibility system action, and the declared target recycling volume is 16.96 million units.

However, at present, there are still many problems in the recycling of waste household appliances in China, including small recycling scale, blocked channels, repeated prohibition of private demolition, etc. The reason is that recycling is difficult to make profits. Dongmingzhu, chairman of Gree Electric, once said that Gree has invested more than 2billion yuan in the field of renewable resource recovery in the past 10 years, but it has not yet made a profit.

In order to solve this problem, there are two main ways. One is that China has established a fund for the treatment of waste electrical and electronic products, which is used to subsidize the recovery and treatment costs of waste electrical and electronic products, and relevant producers and importers must fulfill their obligations to pay; Second, the above-mentioned producer recovery target responsibility system requires that production enterprises need to meet a certain amount of recovery each year.

In addition to some manufacturers’ own investment in recycling plants, these measures also benefit third-party recycling enterprises. For example, some recycling enterprises help manufacturers achieve their annual recycling goals through the “Internet + recycling” model. The policy of replacing old household appliances with new ones has been gradually implemented nationwide, which is also a development opportunity for these third-party enterprises.

Summary

As one of the three carriages driving the economy, repeated epidemics in the first half of the year led to limited consumption, which had a great impact on both the upstream and downstream of the industrial chain. However, it can be seen recently that various regions are promoting the recovery of consumption through various measures such as consumption vouchers and subsidies. On May 26, Shenzhen released several “big gift packs”, including a subsidy of up to 20000 yuan for new energy vehicles and a 15% subsidy for consumer electronics / home appliances.

Optimistic, the current domestic situation is just like the beginning of the outbreak of the epidemic in 2020. The accumulated consumption energy in the first half of the year will break out in the second half of the year. It is believed that June will be a turning point in the domestic consumer market.

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