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Electronics Buyers' Guide

Electronics Manufacturing & Production Handbook 2019


Specialist world can expect an upturn after November’s electronica
5 June 2002, News

electronica remains unchallenged as the worldwide rendezvous for the electronics business. For some years, semiconductor chips have played a key role in pointing the way for all other components as well as applications. Semiconductor manufacturers have already been booked over 33 000 m2 of exhibition space, making this one of the most important sectors at electronica. The trade fair, which takes place at the New Munich Trade Fair Centre in Munich from 12 to 15 November 2002, has always been an economic barometer, and so the specialists see this as a good forecast for 2003.

On the whole, European companies emerged relatively unscathed from the difficult year 2001. Though some (Infineon, Philips) lay close to the average of a 33% drop in turnover, others (SMT Microelectronics) did considerably better. The situation also led to a pronounced shift in product groups: ASSPs (application-specific standard products) are now leading with 38% of turnover, ahead of processors and controllers (21%) storage chips (17%), and discrete components (10%). DRAM and SRAM semiconductor memories, which previously dominated the market with 40%, have now fallen to a modest 10% of total turnover - mainly on account of the dramatic fall in price.

According to the market research institutes, the current year will not exhibit any impressive growth figures. The euphoria of past years led to excessive demand and thus to overcapacity in production which first had to be reduced or matched to changing requirements, so that 2002 is necessarily a period of consolidation. That is also expected to lead to some heavy pruning, in which only a few DRAM manufacturers, broadliners and specialist companies will remain. Even state subsidies, such as exist in Korea, Taiwan, and mainland China, cannot alter things in the long term.

However, clear signs of recovery can already be seen: by the time electronica 2002 takes place, experts expect a better mood and a stable situation leading into the year 2003, when they hope for renewed activity and growth rates of around 20%.

The balanced structure of the German market provided a 'soft landing', comparatively speaking, and the situation in the rest of Europe is similar. The fall in demand in the fields of telecomms, data technology, and entertainment electronics was offset by strong demand in industrial and automotive electronics. In spite of the current poor sales of new cars, specialists still see growth potential in automotive chips: the value of microelectronics in cars is expected to rise from $14,9 billion (in 2000) to $23,9 billion by the year 2005.

The ZVEI's electronic components division has produced a trend analysis with extrapolated figures for the next three years. If things develop as expected, China could become the third largest consumer of microelectronics by 2005.

This forecast is supported by the success of the recent electronicChina trade fair in Shanghai.

According to this analysis, the USA will lose its leading position to Japan. A further result; in addition to these three, four other nations could play an important role with good growth figures: Taiwan, Germany, Singapore, and Korea. This means that Germany will be the only nonAsian country to improve on the record year 2000 - thanks to its widespread in industrial users and the heavy use of automotive and industrial electronics.

For further information contact Margaret Hirse, SA-German Chamber of Commerce and Industry, 011 486 2775,

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