The Greater China region, spanning mainland China, Hong Kong and Taiwan, accounts for about 80 percent of the world's remote control production. The total current monthly production volume is estimated at 100 million units, based on data from the companies in this report. The total monthly capacity is 148 million remote controls.
Mainland China's supplier base comprises some 100 makers, half of which are medium and large companies. Twenty percent of the mainland's remote control makers are covered in this report. Taiwan's industry, affected by competition from the mainland, has been reduced to some 20 active makers.
This report covers 30 remote control manufacturers: 20 from mainland China, seven from Taiwan and three from Hong Kong. The respondents represent a quarter of Greater China's supply base. These companies provided manufacturing, export, sales and product development information and forecasts, from which Global Sources gleaned these findings:
• The line is being strengthened by the growth of the home entertainment and home automation sectors since remote controls are usually bundled with TVs, DVD players and home appliances.
• Single and universal or multiple device remote controls using IR and RF technologies are available from makers, with IR remote controls being the mainstream. The line-of-sight (LoS) limitation of IR technology, however, has prompted the rise of RF-based remote controls.
• Mainland China's output will continue to largely consist of low-end to midrange IR-based models.
• Most Taiwan makers focus on high-end IR and RF units, with some companies investing in the development of ZigBee and Bluetooth models. These models, however, are not foreseen to dominate output in Greater China in the near term, as the costs of Bluetooth and ZigBee chipsets are still prohibitive for makers in the region.
• Single-device remote controls have a solid supply base, but universal remote controls are gaining ground.
• Mainland China's export value is projected to reach US$121 million in 2006, or a growth of 39 percent from US$87 million in 2005.
• Taiwan makers are targeting export value of US$17 million in 2006, or an increase of 31 percent from US$13 million in 2005.
• Prices are affected by rising material and labor costs. Although prices of entry-level single-device and universal remote controls are projected to remain stable, increased quotes are foreseen for high-end models.
Industry Overview
The mature remote control industry in Greater China continues to experience steady growth, and is preparing to enter a transition period marked by technology shifts. The worldwide trend emphasizing wireless technologies is speeding up the adoption of other wireless standards for remote control use. This is combined with the industry's focus on expanded application through learning capabilities and code development.
Infrared (IR) will continue to dominate production in mainland China, Taiwan and Hong Kong for the near term. Ninety-nine percent of mainland China companies focus on the production of IR-based remote controls. RF-based models have yet to be mass-produced at the same levels as IR models' due to low demand. However, remote controls based on RF are expected to steadily gain market traction in the coming years, leveraging its technological advantages over IR's line-of-sight limitations.
A few companies have actually commenced product development on Bluetooth models. Bluetooth and ZigBee are being considered as future growth paths, but it might take a couple or more years for either technology to take off in Greater China. Some makers, especially those based in Taiwan, have expressed interest in pursuing either of these wireless technologies.
However, the low demand and small supply of A/V products — core application of remote controls — that support Bluetooth or ZigBee will influence the pace of this trend. At present, production of Bluetooth is on a per-order basis and not part of makers' regular line.
In terms of supply, Greater China accounts for more than 80 percent of the worldwide market, making it the largest manufacturing base for remote controls worldwide. The estimated total monthly output of company respondents in this report is 25 million units, against a total monthly production capacity of 37 million units. Altogether these companies represent a quarter of Greater China's supply base.
The majority of remote controls from the region are designed for A/V products and white appliances. Makers closely follow product trends in these lines to capture recent developments and mirror these in their remote control R&D and production.
Mainland China makers focus on the low-end and midrange products, with some companies expanding into the high end. Taiwan makers are escaping the constricting market by targeting the high end. Many of the Taiwan-based companies in this report said they will invest strongly in R&D this year to introduce new features and functions.
Industry Composition and Production Centers
There are about 100 remote control makers in mainland China. Guangdong province in the southeast is the center of activity, accounting for 80 percent of total output. The secondary production centers are Zhejiang, Jiangsu, Anhui, Henan and Fujian provinces.
In Guangdong, Shenzhen and Guangzhou are the main sourcing centers, representing 80 percent of Guangdong's supplier base for remote controls. The cities of Dongguan, Zhuhai and Zhongshan have a small concentration of makers.
Remote control manufacturers based in Zhejiang province are mostly concentrated in Hangzhou. In Jiangsu, the main sourcing centers are Suzhou, Wuxi, Zhejiang and Changzhou. The combined supplier base in Zhejiang and Jiangsu provinces, as well as the surrounding areas in the Yangtze River Delta, makes for a second major production center for remote controls in mainland China.
Supplier Profile
Aifa Technology Corp.
Aifa Technology Corp. was established in 1992 and maintains its head office in Kaohsiung Hsien in Taiwan. The company has two factories, one in Taiwan and the other in mainland China.
Remote controls, including single device and universal types, comprise the company's main line, representing 80 percent of output. Aifa's other products include amplifiers, filters, USB remote and receiver sets, telephone amplifiers and video transceivers.
The company boasts an in-house capability to handle IC software design that enables Aifa to customize the functions of its remote controls. Its designs and products are patented.
In 2006, Aifa is projecting a 67 percent increase in total sales revenue, expecting it to reach US$5 million from US$3 million in 2005. Remote controls, which accounted for 100 percent of the company's sales in 2005, are expected to bring in US$3.5 million in sales and exports in 2006, and US$4.5 million in 2007. Aifa's client base is 95 percent OEMs and ODMs from overseas markets. Buyers of its own brand account for the rest. One of the company's major customers is Tomni Corp.
Aifa ships its products to 30 countries. Western Europe is its main market, accounting for 40 percent of shipments. This is followed by East Asia with 30 percent share. North America, Central and South America each account for 10 percent of shipments, while Eastern Europe and South Asia for 5 percent each. Products are exported via Zhongshan, Guangdong.
To maintain its presence in the international market and attract more customers, Aifa attends major trade shows such as Computex, IFA, Hong Kong Electronics Fair and Taitronics.
Manufacturing Capability
Aifa's factory in Taiwan has an area exceeding 600sqm and 30 workers. The mainland China factory in Zhongshan covers an area of 2,000sqm and has 100 workers. The mainland factory was partly bought by Aifa in 2001, with a 25 percent ownership share. In 2003, the company acquired full ownership of the facility.
Except for mold making, all manufacturing processes, including R&D, cosmetic design of body and other parts, electronic parts making, plastic injection molding, painting and silkscreening, surface mount technology, PCB subassembly, other subassemblies, final assembly, QC and packaging, are performed in-house.
All this column of information contained in China Sourcing Reports is the result of original, independent and impartial research conducted by Global Sources analysts.
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