October Book-to-Bill Dips Below Parity

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BANNOCKBURN, Ill. IPC Association Connecting Electronics Industries announced a North American combined rigid and flex PCB book-to-bill ratio of 0.99 for October. The first drop below parity in about two years can be attributed to increased flex circuit shipments in October and August and September shipment increases for rigid PCBs, according to Denny McGuirk, IPC president. The rigid PCB industry ratio decreased from 1.01 in September to 0.99, while flexible circuits remained at about 0.91.

Rigid PCB shipments rose 7.8% and bookings fell 6.0% from October 2005 data. Year-to-date, rigid PCB shipments increased 9.9%; bookings improved 8.3%. Rigid PCB shipments decreased 14.3% from September, with bookings falling 7.5%.

Flexible circuit shipments in October 2006 rose 26.4%; bookings dropped 8.7% compared to October 2005. Year-to-date, flexible circuit shipments have increased 8.3%, but bookings declined by 6.5%. Month-over-month, shipments slowed 6.2% and bookings decreased by 13.0%.

In combined production, shipments increased 9.0% for the month compared to October 2005. Orders booked dropped 6.2% from last year. Year-to-date, combined shipments increased 9.8%; bookings are up 7.2%. Shipments decreased 13.7% since September, and bookings fell 7.9% against the previous month's data.

In October 2006, manufacturers produced 89% of PCBs shipped domestically. Domestic production accounted for 88% of rigid PCB and 95% of flexible circuits. Bare circuits were about 71% of shipment value reported for the month by flexible-circuit producers.

Because bookings tend to be more volatile than shipments, changes in the book-to-bill ratios from month-to-month may not be significant unless a trend of three consecutive months or more is apparent. These ratios are based on monthly data collected from PCB producers that participate in IPC's monthly PCB Statistical Program, calculated by dividing the value of orders booked over the past three months by the value of sales billed during the same period. A ratio of more than 1.00 suggests that current demand is ahead of supply, which indicates probable near-term growth. IPC's monthly survey tracks bookings and shipments from U.S. and Canadian facilities to provide indicators of regional demand.

To see the book-to-bill ratios of 2006, read May Book-to-Bill Shows Promise, July Book-to-Bill Remains Steady, and November Book-to-Bill Continues Downward Slope.



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