Jabil's Global Mechanicals Intelligence Archive

Global Mechanicals Intelligence

Q2 2024 | APRIL- JUNE

MARKET OVERVIEW

• In response to customer demand for a "China+1" strategy, more suppliers are establishing manufacturing facilities outside China. Key industry players such as Delta are expanding their production capacity in Thailand, Chicony Power is constructing a new factory in the same country, and Liteon is exploring relocating some of its product assembly operations to India.
• There is a demand for more compact power supplies and adapters that can integrate seamlessly into products while maintaining high performance.
• Non-customized product supply is readily available from distribution channels.
• End users seek fast charging, universal compatibility, and the ability to charge multiple devices at once, influencing the features of adapters/chargers.
• The evolution of industry standards such as USB-PD, USB Type-C, and others influence the design of adapter/chargers and embedded power modules to ensure compatibility across various devices.
• Investments in public and private charging infrastructure for electric vehicles and renewable energy systems increase demand for specialized power modules, adapters, and chargers.

DEMAND COMMENTARY

• The global shift towards electric vehicles has created a new market for high-power charging equipment. This includes public charging stations and home charging solutions requiring specialized power modules.
• The Internet of Things (IoT) is expanding rapidly, with many connected devices requiring power. These devices often need specialized power modules or adapters for low-power, efficient energy conversion.
• Market demand for consumer and industrial applications is still soft.

SUPPLY ANALYSIS

• Leading Power Supply suppliers have reported that capacity utilization ranges from 50% to 70% due to subdued customer demand, particularly in Networking and Storage segments that do not incorporate AI applications.

• Lead times for chargers and adaptors have been flat at eight to 10 weeks. Hot-pluggable (CRPS) lead times have reduced to 12 to 20 weeks from the past 40+ weeks, except for some uncommon models. The lead time for Power Bricks and modules is 15 to 20 weeks.
• The supply base stays stable, with no signs of suppliers exiting the market.
• Vicor keeps U.S. military customers as its priority; some modules for non-military applications are still on allocation.

PRICING SITUATION

• Product cost is highly correlated with key components such as power management ICs, transformers, PCBs, cables and connectors, and some mechanical housings. 

• Price remains stable and flat for current business and is more competitive from suppliers seeking to gain new business. 

• There are few opportunities for cost reduction, except within high-volume projects.

KEY TAKEAWAYS

• Power supply is gaining considerable attention with the increasing need for power-efficient and durable systems. AC-DC and DC-DC power supplies are being deployed across various verticals, such as medical, lighting, and consumer electronics, among others, by innovations in power semiconductors (e.g., GaN and SiC), digital control technologies, and energy conversion methods to improve efficiency and reduce size.

• Key players are focusing on research and developing new power solution applications for electrical charging and renewable energy.