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Weekly Global Update for January 2, 2014

01.02.2014 // Walt D. Custer // Industry Conditions

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U.S. November Electronic Equipment Orders Increase

The U.S. November Durable Goods Report (preliminary electronic equipment shipments, orders and inventories) was released this past week. Orders improved while shipments declined.

  • The electronic equipment 3-month average book/bill rose to 1.05 (Chart 1).
  • 3/12 Growth of electronic equipment orders improved to 1.04 (Chart 2).
  • Orders rose while shipments declined (Chart 3).
  • The ratio of electronic equipment inventories/orders declined (Chart 4).
  • Defense capital equipment orders were flat but shipments improved (Chart 5).
  • Aircraft and parts shipments have been little changed for the last three months (Chart 6).
  • Communication equipment orders increased (Chart 7) while computer shipments and orders were flat (Chart 8).

Source: www.census.gov/indicator/www/m3/

European PCB Update

Thanks to Data4PCB here is some interesting data on the European PCB Market:

  • Chart 9 lists the top 42 European PCB manufactures ranked in order of 2012 European PCB production. Note that non-European production by multinational companies is not included, just their European production.
  • Chart 10 shows the euro production of these 42 largest European PCB producers (aggregated in groups of five for confidentiality). That is, the first five companies in chart 9 had combined production of 475 million euros, the second five 202 million euros, etc.
  • Charts 11-14 provide a narrative and regional PCB book/bill data for the German-speaking countries, France and the UK.

Source: Data4PCB

Japanese SEMI and Flat Panel Display Orders & Shipment

Charts 15 & 16 provide historical Japanese SEMI and Flat Panel Display equipment monthly orders and shipments.

Source: www.seaj.or.jp/english/

Worldwide PC monitor shipments increased 4.5% q/q to more than 35 million units in 3Q’13 (Charts 17 & 18)

Total worldwide PC monitor shipments were more than 35 million units in the third quarter of 2013, an increase of 4.5% compared to the previous quarter and 1.2 million units more than forecast, according to IDC. On-year growth was negative 8.6% in the third quarter of 2013, largely due to the ongoing decline in PC sales.

"Asia Pacific excluding Japan (APeJ), Western Europe, and Central and Eastern Europe (CEE) outperformed the overall market in the third quarter and increased their regional market shares," said Jennifer Song, research analyst, Worldwide Trackers at IDC. "China and India were the top growth drivers within APeJ, while Germany and Russia were the leading country markets in Europe."

Looking ahead to the fourth quarter of 2013, IDC is forecasting an on-quarter decline of 3.2% in worldwide shipments to 33.9 million units. However, IDC slightly raised its total shipment forecast for 2013 from 134.7 million units to 136.3 million units, which represents a decline of 8.5% compared to 2012. By 2017, worldwide shipments are expected to drop further to 109.6 million units, lower than the previous forecast of 110.8 million units, as the adoption of mobile devices at lower price points is expected to continue.

Technology highlights

  • LED backlight technology adoption continues to increase with 84.9% market share in the third quarter of 2013. This represents an on-year increase of 14.4pp.
  • Screen size of 21.x-inches wide has held the largest worldwide share for the last four quarters, with 21.4% share in the third quarter of 2013.
  • Aspect ratio of 16:9 continues to dominate with 77.5% market share, which is more than four times the second most widely used aspect ratio of 16:10.
  • Monitors with TV tuners are expected to grow to 7.7% market share by 2017, up from 5.7% share in 2013, led by LG and Samsung with a combined market share of 95% in this category.
  • While touchscreen monitors are still a small segment of the total PC monitor market at 0.3% share, it is mostly in the US at 48.6% share with Dell holding a 28.6% portion of the US market.

Vendor highlights

  • Dell stayed in the top position in the third quarter of 2013 with worldwide market share of 13.9% on shipments of 4.8 million units. While the US declined by 13% from previous quarter, APeJ and CEE delivered the biggest gains for Dell with 4.4% and 46% on-quarter growth, respectively.
  • Although Samsung ranked second in shipments worldwide, it remains the top vendor in terms of total revenues with US$1.09 billion in the third quarter of 2013, which represents 17.9% share in total market value.
  • HP remained the number three vendor, with the largest on-quarter increase of 35.8% in Japan.
  • LG stayed in the number four position overall and it continues to be the number one PC monitor vendor in Latin America with 27.8% share. This past quarter it also captured the top position in Central and Eastern Europe with 18.4% share.
  • AOC rejoined the top-5 vendor ranking in the third quarter of 2013 after slipping to number six in the previous quarter with an 11.6% increase in shipments from previous quarter. Every region except Japan saw positive gains, with China and India driving growth.

Source: www.idc.com

Conference Board U.S. Leading Economic Index up 0.8% in November 2013

The Conference Board Leading Economic Index for the U.S. was up 0.8% in November 2013, to 98.3, following a 0.1% increase in October and a 1.0% increase in September.

"The LEI continues on a broad-based upward trend, suggesting gradually strengthening economic conditions through early 2014," said Ataman Ozyildirim, Economist at The Conference Board. "Improving labor markets and new orders in manufacturing, combined with strong financial indicators, drove November's gain. However, consumers' outlook for the economy and the drop in housing permits continue to pose risks in 2014."

"November data reflect a U.S. economy that is expanding modestly, discounting some renewal in activity after the government shutdown," said Ken Goldstein, Economist at The Conference Board. "The coincident economic index shows the economy expanding at a relatively slow pace. The trend in the leading economic index is stronger, signaling for some time that the economy is developing forward momentum, and will continue to strengthen through early 2014."

Source: www.conference-board.org/

World Industrial Production Monthly Growth

Chart 19 lists the most recent industrial production growth data for key countries.

Source: www.economist.com

Japanese PMI Index Improves Significantly

Chart 20 shows monthly Japanese Purchasing Managers Index (PMI) on a historical basis through December 2013. Values greater than 50 indicate manufacturing expansion.

Source: Nomura/JMMA for historical and Markit Economics for recent data.

Metal Prices

Charts 21 to 24 give monthly metal prices for copper, silver, gold and tin.

Source: www.metalprices.com/

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Statements of fact and or opinions expressed in MarketEYE by its contributors are the responsibility of the authors alone and do not imply an opinion of the officers or the representatives of TTI, Inc.

Featured Contributor:
Walt D. Custer

Walt Custer

Walt Custer is an industry analyst focused on the global electronics industry. Prior to forming Custer Consulting Group he was Vice President of Marketing and Sales for Morton Electronic Materials, a global supplier of specialty chemicals and process equipment for the PCB industry.

Custer has been a member of the IPC trade organization since 1975 where he received both the President's and the Raymond E. Pritchard Hall of Fame Awards. He is currently a member of the IPC Executive Market & Technology Steering Committee. Custer is also a Director of the EIPC European PCB trade organization.

He authors regular “Market Outlook” columns for Global SMT & Packaging magazine, the Journal of the HKPCA and the TTI MarketEYE website.

Custer Consulting Group

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