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Shipments in China's home appliance market fell due to the impact of declining exports
Source: | Author:electronics-101 | Published time: 2014-10-11 | 529 Views | Share:
According to iSuppli, China's exports of major home appliances are expected to drop by 2.7% in 2009 due to a decline in exports due to the global economic recession.

According to iSuppli, China's exports of major home appliances are expected to drop by 2.7% in 2009 due to a decline in exports due to the global economic recession. Total shipments of major home appliances in China in 2009 are expected to be 177.5 million units, down from 182.4 million units in 2008. Combined shipments represent market trends for major home appliances such as air conditioners, washing machines, refrigerators, and microwave ovens.

    Exports will be down 8.5% from 2008, from 108.3 million units to 99.1 million units.

    China's domestic market will continue to grow despite a slowdown in the global economy, thanks to government subsidies. China's Ministry of Finance expanded a stimulus program that lowered the price of household appliances for rural consumers by as much as 13 percent. This measure has kept the domestic market at a fairly fast pace of growth, although not as strong as in previous years.

    China's large domestic equipment makers control major home appliance markets. These companies are implementing product differentiation strategies in the domestic market, while in the export market they focus on cost. Designing major appliances with new features that appeal to consumers is a major challenge for manufacturers.

    These companies are adopting a vertically integrated strategy to control key components and equipment to help reduce production costs. Many companies have begun to outsource low-end products to contract manufacturers. In order to improve equipment utilization, major home appliance suppliers are reluctant to expand production capacity.

Due to the general lack of innovative and diversified products in the non-inverter air conditioner market, major air conditioner companies in China are developing products using inverter technology.

    Due to higher prices, China's inverter air conditioner market is expected to grow only moderately in 2009-2010. Chinese local companies are still weak in product design and market development of inverter air conditioners. Chip suppliers need to provide total solutions for controlling variable speed motors. The key chip used in major home appliances, the microcontroller (MCU), is controlled by a Japanese supplier. Through close partnerships with leading Chinese home appliance companies, Japanese suppliers have gained a controlling position in the MCU field. Air conditioners remain an important market for suppliers of semiconductors to major appliance companies. Therefore, the development of the aviation industry should also be expanded to better drive the entire market.