Hubei Provincial Government Official Website and Hubei Daily Special Report on Longteng Electronics

Longteng Electronics, forging a unique path and running fast - Hubei Provincial People's Government Portal www.hubei.gov.cn 2018-08-22 08:56:00

Original link: http://www.hubei.gov.cn/tzhb/touzi/lxhbtzdt/201808/t20180822_1332171.shtml

Source: Hubei Daily

　　The circuit board industry is highly concentrated with technology and talent, and the first-tier cities along the southeast coast should be fertile ground. However, Hubei Longteng Electronics Technology Co., Ltd. has taken a unique path, relocating from Shenzhen back to Xiaochang, a nationally designated poverty county, to "play" with high technology. "We are rushing to produce the latest developed high-frequency high-speed printed circuit boards for communication terminals, with a full-load daily output of up to 600 square meters. Orders have been booked until the end of the year, and many customers are lining up to wait for goods," said Chen Liangfeng, deputy general manager of the company park, in an interview with Hubei Daily's multimedia reporters on August 10.

　　R&D team on the front line

　　Chen Liangfeng said that since settling in Xiaochang, there have been a lot of troubles, both expected and unexpected.

　　The company started production in June 2015, mainly producing mid-to-low-end single-layer integrated circuit boards, with raw material costs of 410 yuan per square meter and market selling prices of 450 yuan per square meter. "After deducting wages, equipment depreciation, and other expenses, the output value was continuously increasing, but the profit was minimal," he said. "The main reason was insufficient technical support."

　　At the beginning of the factory construction, except for a few core technical personnel brought back from Shenzhen, the vast majority of employees were local people from Xiaochang. Many employees did not even know what a circuit board was before joining the factory.

　　To change the situation, it was necessary to build an R&D team. From the initial five-person R&D group to absorbing outstanding personnel from frontline workers, by the end of 2017, the company had formed an R&D team of 70 people.

　　These 70 people did not have a unified office space but were divided into several specialized groups distributed on the production front line. They usually participated in normal production while identifying problems, then used team efforts to research solutions, which were finally applied back to the production line.

　　With the R&D team providing technical support, in 2018, Longteng Electronics actively adjusted its product structure, upgrading to multi-layer, double-sided, and special material printed circuit boards. Although the cost rose to 530 yuan per square meter, the market price also increased to 650 yuan per square meter, with a profit margin exceeding 20%.

　　"Fist" product opens new horizons

　　Product upgrades are underway, but it is not easy to gain a share from well-known companies in the Yangtze River Delta and Pearl River Delta.

　　Company deputy general manager Ran Qihong introduced that since 2017, with the slowdown in demand growth for PCs, tablets, and high-end smartphones, and the rise in raw material prices, competition in the domestic printed circuit board industry has become increasingly fierce, making survival difficult for enterprises. "Well-known domestic printed circuit board manufacturers are mainly concentrated in coastal areas. Being inland, we must have a flagship product."

　　The flagship product Ran Qihong referred to is the optical module high-frequency high-speed integrated circuit board, mainly used in wireless transmission and long-distance transmission.

　　Starting with the nearby communication giant FiberHome Technologies, Longteng Electronics established a technical breakthrough team to meet its technical and quality requirements, developing, prototyping, and delivering samples at the fastest speed, ultimately winning customer trust and recognition, and successfully reaching a cooperation agreement.

　　Ran Qihong said: "The most intense time was when the other party proposed a set of technical parameter modifications at 11 a.m., and we delivered the new product to them by 5 p.m. that day. Our staff made two round trips between Wuhan and Xiaochang, with lunch and dinner consisting only of bread and mineral water."

　　Since then, Longteng Electronics has successively partnered with domestic and international communication industry giants such as Lenovo, Apple, Huawei, and Rapoo. In 2017, the annual production of mobile phone charging port circuit boards reached 1 billion pieces, accounting for more than 70% of the global market share. In April this year, to expand marketing scale, the company also registered an office in Hong Kong to start accepting overseas orders.

　　Environmental benefits show dividends

　　The "three wastes" pollution was once the most troublesome "long-standing problem" for circuit board manufacturers.

　　In 2015, when Longteng Electronics invested in building a factory in Xiaochang, the startup capital was only 70 million yuan, but 23 million yuan was allocated to build environmental protection facilities.

　　Chen Liangfeng said that at the early stage of factory construction, local residents had many complaints, worrying that production operations would affect the surrounding environment, so the first project to start was the environmental protection facilities. "Investing in environmental protection facilities does not make money, and an annual operation and maintenance cost of 2.5 million yuan is required."

　　Inside the factory area, reporters saw that waste gas generated during production was absorbed and removed through equipment dosing, spraying, activated carbon adsorption, and other methods; industrial wastewater was treated in a wastewater treatment station; solid waste was handled by professional companies; and noise was controlled by measures such as enclosure and installation of spring vibration dampers.

　　Over time, this "unprofitable" investment has begun to pay off. Since 2016, central, provincial, and municipal environmental inspections have conducted multiple surprise inspections at Longteng Electronics, finding no environmental issues requiring production suspension or rectification. "The equipment runs 24 hours a day. If production stops for a month, the direct economic loss would reach tens of millions of yuan and would also affect the credit ratings of raw material suppliers and vendors. Such losses are incalculable."

　　Thanks to technology-driven development and self-imposed pollution control, Longteng Electronics has fully released its production capacity. From January to June this year, the company completed an output value of nearly 100 million yuan, a year-on-year increase of 40%. In April, based on the existing 450,000 square meters of printed circuit board projects, the company's phase II expansion project with an investment of more than 86 million yuan was successfully put into production.

　　"Next, we will further deepen the 5G market and plan to achieve an output value of 1 billion yuan by 2020." Speaking about the future prospects, Chen Liangfeng was full of confidence. (Zhao Feng, Huang Yiming)