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China Research Network
On September 27, BYD Co., Ltd. announced that its holding subsidiary, BYD Electronics (International) Co., Ltd., co., Ltd. and Jabil Circuit (Singapore) Pte, a subsidiary of Jabil Inc., on September 26, 2023. Ltd. signed the Share Purchase Agreement.
BYD Electronics intends to acquire Jabil Inc.'s mobile electronics manufacturing business that manufactures consumer electronics components, primarily in Chengdu and Wuxi, for approximately RMB15.8 billion (US$2.2 billion) in cash.
According to the announcement, BYD Electronics is the world's leading platform-based high-end manufacturing enterprise, covering smart phones, tablet computers, new energy vehicles, smart homes, game hardware, drones, Internet of Things, robots, communication equipment, medical and health equipment and other diversified market fields.
According to the announcement, after the completion of the transaction, the target company (Juno Newco), which holds the target business, will become a subsidiary of BYD Electronics, and the financial results of the target company will be consolidated into BYD Electronics' financial statements.
The Target Company is a wholly-owned subsidiary of Jabil Singapore and the Vendor intends to restructure the Target Business to the Target Company, which has not been completed as at the date of this announcement.
According to public information, the counterparty, Jabil Singapore, is a manufacturing solution provider that provides integrated design, manufacturing, supply chain and product management services.
According to Apple's FY2022 supplier list, Jabil is an Apple supplier with factories in Guangdong, Hebei, Jiangsu, Sichuan and Maharashtra, India.
The company is a wholly owned subsidiary of Jabil, a company listed on the New York Stock Exchange. In August 2023, Jabil was selected into the 2023 Fortune Global 500 list, ranking 456th.
BYD Electronics is the world's leading platform-based high-end manufacturing enterprise, covering smart phones, tablet computers, new energy vehicles, smart homes, game hardware, drones, Internet of Things, robots, communication equipment, medical and health equipment and other diversified market fields.
This acquisition will expand the boundaries of BYD Electronics' customers and products, broaden the smart phone parts business, greatly improve BYD Electronics' customer and product structure, further seize market development opportunities, increase the strategic layout of core device products, promote the upgrading of BYD's electronics industry, and enter a new round of high-speed growth cycle.
While increasing the market share of products, it effectively synergizes with BYD Electronics' existing products to enhance the company's overall competitiveness, maintain long-term sustainable development, and create value for customers and shareholders.
In 2022, BYD's electronic turnover will be 107.186 billion yuan, a year-on-year increase of 20.3%, and the profit attributable to equity owners of the parent company will be 1.858 billion yuan, a year-on-year decrease of 19.6%.
Among the turnover, RMB40.58 billion from China decreased year-on-year, while those from overseas amounted to RMB66.602 billion, up 39% year-on-year. In 2022, BYD Electronics accounted for 62% of overseas sales, while overseas turnover accounted for only 54% in 2021.
The electronic manufacturing service (EMS) industry is a collection of manufacturing entities that provide overall solutions such as design, raw material procurement, manufacturing, and after-sales service for various electronic communication products and equipment based on the production mode of electronic manufacturing outsourcing services.
The emergence of EMS industry is the result of the professional division of labor in the global electronics industry chain, which is in the middle of the industrial chain, serving direct-to-consumer brands, and is widely used in industrial control, communications, medical electronics, consumer electronics, automotive electronics and other markets.
Electronic manufacturing service enterprises are responsible for the production and manufacturing links in the electronic product value chain, and EMS manufacturers provide manufacturing services for electronic product brands with rich industry experience and professional manufacturing capabilities to meet the needs of brand owners to focus on brand management, reduce production costs, rapidly expand product production capacity, and shorten product launch time.
From the perspective of the industrial chain, the upstream of the EMS industry is mainly PCB, packaging materials, IC integrated circuits, modules, antennas and other electronic component material manufacturers, upstream manufacturers supply material cycle, quality and price, will affect the EMS manufacturers delivery cycle, product prices, etc. to a certain extent.
The downstream is mainly brand manufacturers, ODM manufacturers and OEM manufacturers. EMS manufacturers are responsible for non-core business in the industry chain, including product manufacturing, back-end logistics management, product logistics and transportation, and product quality management.
In the context of the huge scale of the electronic product market and the rapid change of demand, EMS services have shown a multi-industry development trend centered on the production and manufacturing of the computer field from the initial development, covering communications, industrial control, consumer electronics, medical electronics, automotive electronics, household appliances, electrical equipment, aerospace and other fields.
With the continuous improvement of the comprehensive strength of the mainland electronics manufacturing industry and the huge demand for electronic product consumer market, the world's major electronic brands have entered China, transferring more and more production capacity to China, which also directly leads to the increase in EMS business volume, providing development opportunities for domestic EMS companies to enter the supply chain of international brands.
According to the analysis of the research report of the Puhua Industrial Institute of the Chinese Research Institute
In recent years, the EMS industry is investing in automated production equipment and management information systems on a large scale and on a large scale, seeking to improve its comprehensive strength with the further improvement of production management level, quality control and traceability system of the whole industry chain, and providing users with high-reliability manufacturing service experience.
With the steady advancement of intelligent manufacturing strategy, EMS manufacturers will be more intelligent and agile in the future, and promote the outsourcing of supply chain links in more application fields, thereby promoting the further improvement of EMS penetration.
At present, electronic manufacturing service providers can provide brands with diversified comprehensive services, including product design, engineering development, manufacturing, testing, warehousing and logistics, after-sales service, etc.
In recent years, with the continuous improvement of China's macroeconomic development level, China has gradually developed from a major electronic product manufacturing country into an important electronic product consumer market and brand exporter, which provides broad development opportunities for the mainland's electronic manufacturing service market.
China has gradually transformed from a major electronics manufacturer to an important consumer market and brand exporter of electronic products. The rise of domestic brands such as Huawei, Xiaomi and ZTE has laid a solid foundation for the development of the domestic electronics manufacturing service market.
In order to ensure product quality, domestic brands will put forward standardized management requirements for electronic manufacturing service providers, and help electronic manufacturing service providers upgrade their manufacturing processes and equipment through technical and financial support, which will provide great opportunities for the further development of the electronic manufacturing service market.
With the increasing maturity of the outsourcing business model, the service capabilities of foundry service providers continue to improve, not only need to be responsible for surface mounting, plug-in, welding, assembly, testing and other work of electronic product circuit board assembly, but also need to be responsible for material procurement, product development and design and other services.
In order to cope with market competition, improve the overall competitiveness of the supply chain, many brand owners continue to expand the outsourcing ratio of services in each link of the supply chain, and focus their development on responding to market demand, adjusting product structure and operating brands, which also provides a broad space for the development of EMS companies.
The development trend of the electronic manufacturing service industry is to create a complete system including R&D, planning, design, manufacturing, testing, release, testing, testing, after-sales and other all-round services through the integration of the industrial chain, so as to achieve the rapid development of enterprises and maximize customer satisfaction.
In the future, with the further adoption of electronic products, the total sales of China's electronic product manufacturing market is expected to reach US$627.7 billion by 2026, with a compound annual growth rate of 3.2% between 2021 and 2026.
The electronic manufacturing service industry research report aims to start from the strategy of national economic and industrial development, analyze the future policy trend of electronic manufacturing services and the development trend of regulatory system, tap the market potential of electronic manufacturing service industry, and provide a vivid depiction of market changes from multiple angles such as industrial scale, industrial structure, regional structure, market competition, and industrial profitability based on in-depth research on key market segments, and clear development direction.
For more information about the market data of the electronic manufacturing service industry and the future investment prospects of the industry, you can click to view the research report of the Puhua Industrial Institute of the Chinese Research Institute
Pay attention to the headline "Central Research Institute Puhua Research Institute", private message "Industry Report", you can get an excerpt of the report, come and discuss quickly!