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In this edition of MarketEye business analyst, Walt Custer, reviews a number of key releases that occurred in the global electronics industry last week. .

Global Business Conditions: Charts & Data Do the Talking

Walt Custer July 28, 2008

A number of key releases of global electronics’ data occurred last week. U.S., European, and Japanese electronic equipment and component monthly updates plus IPC’s North American PCB shipments and orders provide insight into global business conditions.

Global Electronic Equipment Growth

( Chart 1 ) summarizes current 3-month (3/12) growth rates for Japanese, European, Taiwanese/Chinese, and U.S. electronic equipment shipment growth. Southeast Asia has leveled out at +14%, Europe edged up to +10%, the United States dipped to +3% and Japan slid to -6%. On balance, growth has slowed but the world electronics industry is not in a recession.

U.S. Electronic Equipment and Components

Although the 3-month average book/bill ratio for U.S. electronic equipment increased to 1.02 in June ( Chart 2 ), both shipment and order growth continued to slide ( Chart 3 ). Actual orders were above shipments ( Chart 4 ) as domestic electronic equipment demand continues to increase – but admittedly at a continually slower pace. ( Chart 5 and Chart 6 ) show the performance of U.S. communication and computer equipment. Unfortunately local semiconductor production ( Chart 7 ) continues to nosedive. The recent announcement of Hynix’s Oregon DRAM plant shutdown will not help!

European Electronic Equipment and Automotive Production

In Europe computer production has been expanding significantly based upon the EEC’s Eurostat data ( Chart 8 ). Automotive production ( Chart 9 ), however, has recently plunged. Will Europe’s car sales mirror the U.S. automotive decline?

Japanese Electronic Equipment and Components

In Japan electronic equipment production slid 4% from May’07 to May’08 ( Chart 10 ). ( Chart 11 ) shows YTD Japanese electronic equipment by type. Japanese printed circuit boards ( Chart 12 ) continued their decline in May’08 with their 3-month (3/12) growth shrinking to -7.4% ( Chart 13 ).
( Chart 14 ) depicts Japanese PCB production by board type on a YTD basis. ( Chart 15 ) gives YTD Japanese electronic component production by type and ( Chart 16 ) the current growth (+1.2%) for Japanese components.

North American Printed Circuit Performance

In North America the June rigid PCB book/bill ratio dropped slightly on a 3-month average basis but climbed to 0.97 for the month ( Chart 17 ).
( Chart 18 ) summarizes rigid and flex printed circuit performance and ( Chart 19 ) shows actual orders and shipments from the IPC statistical program - comparing January to June 2007 versus 2008. Demand did improve in May!

World PCB Growth

( Chart 20 ) provides 3-month growth by region for printed circuit shipments worldwide. Japan and Europe are “under water” compared to 2007; however, as a group PCB production is up about 1% compared to the same time period in 2007.