Samsung Electro-Mechanics is expediting its plan to foster its multilayer ceramic capacitor (MLCC) business. At its center is its Busan plant. MLCCs for automobiles produced at this plant are very small -- 3.2 mm in width and 2.5 mm in length. This plant manages the entire production process from research and development (R&D) to final production. Samsung Electro-Mechanics produces high-priced products selectively at this plant.
MLCCs store electrical energy in circuits and send it when needed. The more data electronic equipment processes, the more MLCCs they need. MLCCs have two major markets, one for IT products and the other for automobiles. The number of MLCCs per car is much higher than that of MLCCs per IT product -- 800 to 1,000 MLCCs for a smartphone, 1,200 for a personal computer (PC), 2,000 for a TV and up to 20,000 for a car.
MLCCs for automobiles are very lucrative as well. Prices of MLCCs for automobiles are up to 5 times higher than those of IT products. They also have a great growth potential. Currently, the market for MLCCs for automobiles accounts for only 20 percent of the entire MLCC market, but it is expected to grow to 35 percent by 2024. As automobiles will have increasingly more and more electronic equipment and devices, the market for MLCCs for automobiles will grow faster. The global electric car market is expected to grow from 1.2 million units in 2017 to 11 million in 2025, market researcher Counterpoint Research said.
Currently, Samsung Electro-Mechanics ranks second after Japan's Murata in the overall MLCC market, but it has a small share of the market for vehicle MLCCs. "Technical barriers are high for MLCCs for automobiles, but the vehicle MLCC market is stable as corporate customers want long-term supply," said Jeong Hae-seok, an executive director at Samsung Electro-Mechanics. "This year, we are aiming to take 10 percent of the market for vehicle MLCCs but in 2022 we will be the world's second largest producer." Currently, Japanese companies such as Murata and TDK are dominating the market for vehicle MLCCs.