The Plan… Target Higher Growth End Markets & Increased Share Await a Modest Second Half Recovery
Based upon still preliminary results global electronic equipment revenues (consolidated in U.S. dollars) declined an estimated 3.4% in 1Q’16 vs 1Q’15 (Chart 1). A large portion of this dollar denominated decline was due to exchange rate effects as weaker non-dollar currencies were converted to stronger U.S. dollars.
With the exception of automotive electronics all sectors of the global electronic supply chain “felt the pain” in the first quarter (Chart 2) as declines or weaker growth in the volume computer, mobile phone and datacom sectors negatively impacted EMS & ODM providers and component, material and capital equipment suppliers.
Through April world electronic equipment revenues were exhibiting their normal monthly seasonality –but reduced by overall weak market demand. April 2016 world electronic equipment shipments were down 5.4% vs April 2015 and down 5.9% sequentially vs. March 2016 (Chart 3).
In the U.S. both orders and shipments of electronic equipment stalled in the first quarter (Chart 4) however performance varied significantly by end market as the automotive and instrument sectors outperformed the other domestic electronic markets (Chart 5).
Looking forward we appear to have passed the “bottom” of this current down turn (Chart 6) but growth (other than normal seasonality) will likely not occur until 3Q’16 when the 3/12 growth rate in Chart 6 reaches 1.0.
Global semiconductor shipments (and their leading indicator) also point to a summer or early autumn recovery based (Chart 7).
It has been a tough first half but hopefully modest relief is in site later this year! Targeting the higher growth end markets and increased share will be key to success.
• 5G equipment spending will reach $400 billion globally. –Chetan Sharma Consulting
• China smartphone shipments declined 5% y/y to 104.9 million in 1Q’16. –Strategy Analytics
• Taiwan smartphone shipments are expected to reach 7-7.5 million units in 2016, compared to 7.5-8 million in 2015. –Digitimes
• Taiwan smartphone shipments declined 13.1% y/y to 13.95 million units in 1Q’16. –Digitimes Research
• India’s smartphone market grew 12% y/y to 24.4 million units in 1Q’16. –Canalys
• Smartphone shipments increased slightly to 335 million units in 1Q’16 from 334 million in 1Q’15. –IDC
COMPUTERS & PERIPHERALS
• EMEA PC shipments declined 10% q/q to 19.5 million units in 1Q’16. –Gartner
• Industrial PC revenue is forecast to grow at a 6% CAGR to $4.3 billion in 2019. –IHS
• Notebook shipments declined 7.3% y/y to 35.62 million units in 1Q’16. –TrendForce
• PC shipments declined 9.6% to 64.8 million units in 1Q’16. –Gartner
• Tablet shipments declined 14.7% y/y to 39.6 million in 1Q’16. –IDC
MEMORY AND STORAGE
• SIM card unit shipments are forecast to increase from 5.4 billion in 2015 to 5.6 billion in 2020. –IHS
PANELS/ MONITORS/ TOUCH SCREENS
• China color TV market sales grew 3% to 12.44 million unit in 1Q’16. –All View Cloud
• Taiwan LCD monitors shipments from ODMs, OEMs and OBMs reached 19.041 million units in 1Q’16. –Digitimes Research
• Taiwan LCD TV shipments decreased 1.7% y/y to 7.35 million units in 1Q’16. –Digitimes Research
• AMOLED display shipments will grow 40% y/y to 395 million units in 2016. –IHS
• IGZO panel capacity will increase 45% y/y to 6.9 million M2 in 2016. –WitsView
• LCD TV panel production capacity will grow 8.8% q/q to 42.6 million M2 in 2Q’16. –Sigmaintell
• LCD TV shipments declined 6.3% y/y to 48.32 million units in 1Q’16. –WitsView
• LED manufacturing is expected to grow from $1.8 billion in 2016 to $3.6 by 2020. –DeitY
• Small-medium display market revenue rose 4% y/y to $43.9 billion (2.8 billion units) in 2015. –IHS
• TV panel shipments decreased 8% y/y to 59.7 million units in 1Q’16. –Sigmaintell
• Ultra HD TV panel shipments increased 77% to 10.45 million in 1Q’16. –Sigmaintell
• 3D printing industry will grow from $7.3 billion in 2016 to $21 billion by 2020. –UPS and CTA
• 3D printing materials market is projected to reach US$1.4 billion by 2021. –Research and Markets
• Automotive electronics represented 8.9% of the $1.42 trillion total worldwide electronic systems market in 2015, a slight increase from 8.6% in 2014. –IC Insights
• Automotive image sensor market will grow from US$440 million in 2015 to US$900 million in 2020. –Digitimes Research
• Automotive touch panel shipments are expected to expand from 28 million units in 2013 to 86 million in 2021. –IHS
INTERNET OF THINGS
• IoT connected device market is forecasted to grow from 15.4 billion devices in 2015 to 30.7 billion devices in 2020 and 75.4 billion by 2025 –IHS
• IoT security spending will grow from $281.5 million in 2015 to $348 Million in 2016. –Gartner
• IT infrastructure products (server, storage, and Ethernet switch) spending for deployment in cloud environments will increase by 18.9% y/y to $38.2 billion in 2016. –IDC
• Chinese industrial robots market is expected to grow at a 20% CAGR from $1.3 billion in 2015 to $3.3 billion in 2020. –IHS
• U.S. articulated robots market will grow from US$ 751 million in 2015 to USD 1.28 billion by 2020. –Technavio
• Home automation systems market is expected to grow at a 12.5% CAGR to $78 billion by 2022. –ReportsnReports
VIRTUAL OR AUGMENTED REALITY
• Virtual Reality hardware shipments will grow from 9.6 million units in 2016 to 110 million units in 2020. –IDC
• Virtual Reality market will grow from US$2.54 billion in 2016 to US$13.5 billion by 2020. –JPMorgan Securities
• Enterprise and industrial wearables shipments will increase from 2.3 million in 2015 to 66.4 million units by 2021. –Tractica
• Wireless charging transmitter shipments more than doubled y/y to 53 million units in 2015. –IHS
• Wireless power revenue is expected to total $79 billion by 2024. –Navigant Research
EMS, ODM & Related Assembly Activity
• Mexico received automotive ISO/TS 16949 certification.
• started production at its newly built 113,020 SF facility in La Soukra, Tunisia.
AWS Electronics dedicated 1,000 SF of manufacturing space purely for high voltage production at its plant in Newcastle Under Lyme, UK.
Benchmark Electronics elected Jeffrey McCreary and Robert Gifford to its Board of Directors.
Computrol added a SPEA 4050 flying probe tester and a Nordson DAGE’s XD7600NT Ruby X-ray benchmark system to its Meridian, Idaho facility
ControlTek hired Mike Hagen as Principal Engineer.
Dixon Technologies began making 3G and 4G smartphones for Gionee in India.
Efore appointed Jorma Wiitakorpi, CEO.
EMS Solutions increased chip per hour placement by additional 18,000 with addition of new equipment.
EPE Corporation purchased an Agilent Series 5000 5DX X-Ray system.
Epec Engineered Technologies hired Ryan Sanford as West Coast Regional Sales Manager.
• appointed John Carlson, President of Flex Medical Solutions.
• had wearables technology account for $1 billion of its $25 billion revenue in 2015. –CEO, Mike McNamara
• Director of Strategic Supply Chain, Rick Eklund was inducted into the Academy of Chemical Engineers at Missouri University of Science and Technology.
Foxconn acquired 50.07% stake in TeleEye for US$30.95 million.
Hallmark Nameplate added an Ersa Smartflow 2020 selective soldering system to its Florida manufacturing facility.
Inovar installed an XD7600NT Ruby X-ray inspection system from Nordson DAGE.
• began making 3D printers for Makerbot.
• built its predictive analytics platform based on Microsoft Azure Machine Learning.
KangDe Xin Composite Material and Aries EPICA set up an electronic manufacturing facility in Telangana, India for 3D related consumer and non-consumer electronics products.
• appointed Dan Rekieta, Senior Account Manager.
• Program Manager, Bruce McKee earned his EMS program manager certification under the IPC EMS Program Manager Training and Certification program.
Morgan Newton hired Todd Kingrey as new VP of Marketing & Sales.
OCM Manufacturing launched its new electronics test service, Flying Probe Test, using a new SPEA 4050 S2 test machine.
Plexus will promote Executive VP and COO, Todd Kelsey, to President and CEO on October 2, 2016, Dean Foate will continue as an Executive Chairman until September 30, 2017.
Powerspec leased a 9,000 SF industrial property in Somerville, New Jersey.
Proto Labs named Rich Baker, CTO.
Ryder Industries selected Microsoft Dynamics to run its next-generation ERP system.
Saline Lectronics implemented Cogiscan’s factory intelligence software to better understand the performance and needs of its SMT production lines.
• began mass producing E4 robots for Ecoppia at its new facility near Chennai, India.
• cut 40 jobs at its Kingston Industrial Estate factory in Port Glasgow, UK.
Scanfil will close its production plant in Cambridge, UK by July 25, 2016.
Semi-Kinetics purchased four DEK Horizon 031X screen printers, four Samsung SM482 pick and place machines, four Heller 1707 MKIII reflow ovens, a Nordson DAGE Ruby X-Ray System and two Nordson YESTECH AOI systems.
Stadium Group opened a 200 M2 Kista Design Center in Stockholm, Sweden to drive wireless technologies growth.
Surface Electronics acquired South Wessex Electronics from administration.
Syrma Technology added a 30,000 SF manufacturing center in the Special Economic Zone of Chennai, India.
Vadatech opened a £4m European integration center in Southampton, UK.
Valtronic named Charles Connell, Sales Engineer –East Coast and Jennifer Aldridge, Sales Engineer –West Coast.
Variosystems added a 6,300 M2 production hall in Sri Lanka.
VirTex appointed William Ryczkowski, New Business Development Manager.
Wistron established two wholly owned subsidiaries: Wistron Medical Tech Holding and Wistron Digital Technology Holding.
Automotive PCB market reached about $5.2 billion or about 9% of total world PCB shipments in 2015; Japan and Taiwan accounted for 58% market share. –Dr. Hayao Nakahara
Taiwan-based PCB players are pushing into car-use products as demand for PCs, smartphones and tablets has been weakening.
Advanced Circuits acquired Micom Circuits (New Brighton, MN) assets.
All Flex hired Glenn Menear for its applications engineering sales team.
American Standard Circuits
• installed an Orbotech GenFlex CAM system.
• purchased an INSPECTA HPL dual-station X-Ray drill machine from Pluritec.
APCT acquired Tech Circuits.
Aspocomp’s Oulu, Finland factory received ISO TS 16949 certification.
• and UTAC entered collaboration to provide complete turnkey supply chain solutions for 3D SiP requirements.
• opened its Chongqing, China IC substrate plant.
Cadence Design Systems expanded OrCAD Solution to address flex and rigid-flex design challenges for IoT, wearables and mobile devices.
Coast to Coast Circuits (formerly PJC Technologies, DBA Speedy Circuits and Metro Circuits) added DIS Direct Optical Registration to its California operations.
Compunetics received an IPC-6012/600 qualified manufacturers listing from IPC’s validation services.
DYCONEX will celebrate its 25th anniversary in September 2016.
Elekonta Marek added an Orbotech Diamond 8 solder mask system in Gerlingen, Germany.
Eurocircuits completed additional 1,980 M2 building in Eger, Hungary.
FTG Circuits acquired Teledyne’s printed circuit technology business (“Teledyne PCT”).
Goldenmax International Technology acquired Hangzhou Union Printed Circuit Board.
HCI Equity Partners acquired KCA Electronics and Marcel Electronics International; named Shane Whiteside, President and CEO.
• appointed Andres Ojalill, Standards Development Manager in Europe.
• named Pierre-Jean Albrieux of IFTEC and David Raby of STI Electronics the recipients of IPC President’s Award at IPC APEX EXPO 2016.
ISU PETASYS acquired 85.3% of ISU Petasys Asia.
Metrigraphics achieved micron-scale flexible circuits by stacking six or more layers with traces as narrow as 3 microns.
Microtek Laboratory China added Gen3 Systems redesigned line of surface insulation resistance testers and a conductive anodic filament monitoring testing system.
PNC purchased a Nanojet inline electronic cleaning system from Austin American Technology.
Ram Electronics was acquired by Light Corporation’s former executive team members, Brad Davis and Lynne Bosgraaf.
Schweizer Electronic Supervisory Board appointed Nicolas Schweizer as Deputy Chairman of the Management Board, to take over Maren Schweizer’s tasks as CEO during her absence due to health reasons.
Sunrise Electronics began offering specialized metal Core Technology where the metal core product is in direct contact to the Aluminum substrate.
Tiger Synergy terminated its planned RM16m acquisition of BPE Synergy Engineering.
Xerox is developing 3D printed circuit board technology for “smart devices” that can sense and interact with their environment.
Materials & Process Equipment
Global electronic chemicals and materials market is expected to reach close to USD 29 billion in revenue by 2020. –Technavio Research
Advanced MP Technology opened 16,000 SF facilities in Hong Kong.
Alpha Assembly Solutions launched Chinese and German language websites.
Atotech was put up for sale by parent company, Total.
BotFactory introduced Squink upgrade that enables 3D printing of multi-layer PCBs.
Cambrios Advanced Materials restarted silver nanowire business after being acquired by Champ Great Int’l Corporation.
• acquired FocalSpot.
• hired David Phillips as Customer Service Manager.
Dow Chemical Electronic Materials’ Peter Trefonas, Ph.D., received the Perkin Medal from Society of Chemical Industry, America Group.
Electrolube expanded Export Manager, Bruce Ward’s territory to U.S. East Coast.
Ellsworth Adhesives appointed K. (Keith) Shawn McClarnon as General Sales Manager for Eastern U.S. region.
Essemtec hired Bob Stevenson as U.S. Business Development Manager.
FRX Polymers and Shengyi Technology developed low dielectric loss copper clad laminate formulation for printed circuit boards.
Glenbrook Technologies is celebrating 33 years and 2,500 installations.
HK Wentworth opened a new factory in India.
Honeywell plans to spin off its $1.3 billion/yr. resins and chemicals business.
IEC Electronics is celebrating its 50th anniversary.
• Assistant Technical Manager, Eric Bastow earned SMT Processes re-certification.
• hired Andreas Karch as Regional Technical Manager, Germany, Austria and Switzerland.
ISRA VISON added Lars Brickenkamp to management team to drive development of intelligent, networked and adaptive modules.
KIC hired Isidre Rosello as COO.
Lasermicronics appointed Thorne Lietz, head of PCB laser services.
MacDermid Enthone appointed Steve Wilde, Global OEM Manager.
Mentor Graphics appointed Veronica Watson, VP, Regional Sales for the Americas.
Panasonic and Siemens entered cooperation for next-generation electronic equipment assembly plants.
Pickering Interfaces hired Adi Finkenzeller as Regional Sales Manager.
Teledyne acquired Quantum Data.
Uyemura named April LaBonte, Tech Service Engineer for Southern California.
Ventec International Group appointed Thomas Michels, Managing Director Ventec Europe.
Yamaha Motor IM America promoted Takashi Kimura to President, Yamaha Motor Intelligent Machinery America and Naofumi Tanaka, GM, Overseas SMT Sales & Marketing Division.
ZESTRON Europe promoted Thomas Möller to Senior Process Engineer.
Semiconductors & Other Components
Worldwide semiconductor revenues are expected to decline by 0.6% y/y to US$333 billion in 2016. –Gartner
Semiconductor capital spending is projected to decline 2% y/y to $62.8 billion in 2016. –Gartner
Semiconductor foundry market grew 4.4% to $48.8 billion in 2015. –Gartner
Semiconductor materials market decreased 1.5% y/y to $43.4B in 2015. –SEMI
Semiconductor photomask market is forecast to grow from $3.3 billion in 2015 to $3.4 billion in 2017. –SEMI
European semiconductor sales were USD 8 billion in 1Q’16. –ESIA
North America-based semiconductor equipment manufacturers posted $1.38 billion in orders worldwide in March 2016 (3-month average basis) and a book-to-bill ratio of 1.15. –SEMI
Capacitor market will account for approximately US$20 billion in global revenues for FY16 with almost two trillion pieces shipped. –Paumanok Publications
IC wafer 300mm fabs are expected to reach 100 in 2016; high volume 450mm IC wafer fabs not expected until after 2020. –IC Insights
IoT chip market is estimated to grow at a 10.3% CAGR from USD 4.7 billion in 2015 to USD 9.3 billion by 2022. –Research and Markets
Wireless semiconductor market grew almost 4% y/y to over $56 billion in 2015. –IHS
• U.S. wearable sensors market is expected to increase at a 47% CAGR to $100 million by 2018. –Research and Markets
• CMOS image sensor revenue grew 12% y/y in 2015 to $9.9 billion. –IC Insights
• Optical sensor market is growing at an almost 10% CAGR to exceed USD 33 billion by 2020. –Technavio
• Photonic sensors market is expected to grow at almost 4% CAGR to more than US$ 30 billion by 2020. –Technavio
• Pressure sensors market is expected to increase at a 6.1% CAGR to $7.7 billion by 2018. –Research and Markets
• Proximity sensors market is forecast to increase at a 7.55% CAGR to $4.4 billion by 2018. –Research and Markets
• Smart sensor market is expected to grow at an 18% CAGR from US$ 18.6 billion in 2015 to USD 57.8 billion by 2022. –MarketsandMarkets
• Wearable sensors market will reach $6.1 billion by 2026. –Research and Markets
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