North American and European Switch Markets Compared

01.05.2010 // Posted by: Michael Schwert // Posted in: Articles, Switches & Relays

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This month the North American market performance will be compared to Europe for the first three quarters of this year.

North America

Total reported sales for all switch types in North America for Q3 of 2009 were 5% less than the previous quarter and 33% lower than observed in the third quarter of 2008. Sales units for Q3 2009 were 1% above the units sold in Q2 2009 and 27% less than Q3 last year.

The total booking dollars reported for all switch types in North America for Q3 2009 came in 4% lower than last quarter and below Q3 2008’s by more than 38%. The third quarter’s book-to-bill ratio for dollars was 0.982. Booking units in Q3 2008 ran over 11% above Q2. The second quarter’s book-to-bill ratio for units was 1.174.

The third quarter versus the second showed total sales dollar and units down 5% and up1% respectively. Dollar gains were limited to two types while units improved in five of eight types. Seven of eight switch types realized lower prices, and the total ASP dropped 5%. Compared to the third quarter of last year dollars and units were down significantly across nearly all types with prices off by a lower percent. The year-to-date results were very similar to the same quarter last year except prices rose for four of eight types.

Sales Growth by Switch Type

YTD CY 2009

	Q3 2009 Versus Q2 2009			Q3 2009 Versus Q3 2008			YTD CY2009 Versus
Category	Dollars	Units	ASP	Dollars	Units	ASP	Dollars	Units	ASP
DIP	-3.1%	-4.2%	1.2%	-27.6%	-24.0%	-4.7%	-31.2%	-26.4%	-6.5%
Keylock	12.7%	66.5%	-32.3	23.0%	-12.6%	-12.0%	-34.5 %	-40.7%	10.2%
Push Button	-14.5%	7.4%	-20.4%	-46.0%	-38.8%	-11.9%	-49.5%	-51.3%	3.5%
Rocker	0.4%	13.3%	-11.4%	-33.4%	-35.1%	2.6%	-35.0%	-42.3%	11.2%
Slide	-14.1%	-5.5%	-9.2%	-31.5%	4.9%	-34.7%	-44.9%	-24.5%	-27.3%
Snap Action	-1.8 %	1.9%	-3.6%	-26.5 %	-19.4%	-8.8%	-32.0%	-24.4%	-10.0%
Tact	-7.5%	1.7%	-9.0%	-33.6%	-30.4%	-4.7%	-45.7%	-42.7%	-4.8%
Toggle	-17.0%	-3.8%	-13.7%	-54.3%	-44.0 %	-18.4%	-49.5%	-50.0 %	0.1%
Total	-4.5%	0.7%	-5.2%	-33.4%	-27.3%	-8.4%	-38.2%	-37.3%	-1.5%

When compared to the last quarter total booking dollars slipped 4% and units rose 12%. Dollars improved in only three categories while units gained in seven of eight types. Booked prices were down in seven of eight types and in total by 14%. Booked dollars, units, and booking prices in Q3 against a year ago were down in nearly all types with an overall 27% drop in dollars, 11% for units, and 19% for the ABP. The year to date comparison is very similar, but more severe for dollars and units, to the same quarter last year.

Bookings Growth by Switch Type

YTD CY 2009

	Q3 2009 Versus Q2 2009			Q3 2009 Versus Q3 2008			YTD CY2009 Versus
Category	Dollars	Units	ABP	Dollars	Units	ABP	Dollars	Units	ABP
DIP	19.3%	19.7%	-0.3%	-4.2%	-2.8%	-1.4%	-28.7%	-25.6%	-4.0%
Keylock	20.7%	52.7%	-21.0 %	-11.1%	-16.2%	6.2%	-35.1%	-36.6%	0.2%
Push Button	-20.5%	10.3%	-27.9%	-42.4%	-19.7%	-28.2%	-41.3%	-43.8%	2.9%
Rocker	-4.7%	7.6%	-11.4%	-32.1%	-15.6%	-19.5%	-41.4%	-41.9%	-0.1%
Slide	-9.4%	16.8%	-22.4%	-31.2%	12.4%	-38.8%	-35.0%	-12.8%	-25.8%
Snap Action	-5.0%	1.0%	-5.9%	-25.4%	-13.5%	-13.8%	-36.1%	-28.2%	-11.3%
Tact	3.3%	25.7%	-17.6%	-15.9%	-11.7%	-4.7%	-38.0%	-35.0%	-4.0%
Toggle	-2.4%	-7.7%	5.7%	-41.3%	-33.8%	-11.2%	-50.9%	-49.4%	-4.1%
Total	-4.4%	11.6%	-14.4	-27.4%	-10.6%	-18.7%	-38.4%	-32.4%	-8.9%

The graph below shows total quarterly indexed sales and bookings in dollars and units for the reported data since Q3 CY 2007. Unit sales and bookings were on a significant upward trend that peaked in the beginning of 2008. Sales and booking units and dollars fell significantly in third and fourth quarters of 2008, more so in the first quarter of this year, and recovered in Q2. Sales and booking dollars retreated some in Q3 while units grew with bookings leading sales. The second graph of indexed sales shows all sales and booking metrics were are at the lowest levels recorded by Switch Tracks in Q1 of this year and second lowest in Q3.

Book-to-bill units continued its ascent that started after the fourth quarter of last year. Book-to-bill dollars leveled off just below 1.0 as the price ratio fell to a two year low.

For the period, booking prices generally declined until last year’s Q4 jump upward followed by a return downward setting a two year low in Q3. Selling prices have followed a similar but slightly higher path. These jumps in total market price are largely due to mix shift to higher or lower priced switches. The second price graph shows prices indexed since Q1 of 2003 and both the selling and book prices have reached all time lows.

Europe

Total reported sales for all switch types in Europe for Q3 of 2009 were 2% above the previous quarter and 35% less than the third quarter of 2008. Sales units for Q3 2009 were 2% better than Q2 and 30% below Q3 2008.

The total booking dollars reported for all switch types in Europe for Q3 2009 ran 7% higher than the previous quarter and below Q3 2008’s total bookings by more than 28%. The third quarter’s book-to-bill ratio for euros was 1.137. Booking units in Q3 2009 were 2% above Q2. The third quarter’s book-to-bill ratio for units was 1.105.

The third quarter versus the second showed overall improvement for sales euros and units with little change in average selling prices (ASP). Sales euros increased for five categories while units improved in six of eight groups. Prices were lower in seven of eight categories but unchanged in total indicating a mix shift to higher priced switches. Q3 compared to a year ago shows significant losses in euros, units, and ASP’s for all but DIP and rocker prices. Year-to-date (YTD) total sales are down 41% in euros and 36% in units. Total ASP is down 7% with five categories falling.

Sales Growth By Switch Type

	Q3 2009 Versus Q2 2009			Q3 2009 Versus Q3 2008			YTD 2009 Vs. YTD 2008
Category	Euros	Units	ASP	Euros	Units	ASP	Euros	Units	ASP
DIP	10.8%	-4.1%	15.5%	-41.5%	-49.5%	15.9%	-43.2%	-42.5%	-1.7%
Keylock	-0.4%	6.8%	-6.7%	-41.7%	-5.2%	-38.5%	-39.1%	-5.1%	-36.0%
Push Button	5.8%	7.9%	-2.0%	-41.2%	-35.7%	-8.5%	-42.4%	-42.2%	-0.3%
Rocker	12.3%	23.0%	-8.7%	-29.5%	-30.1%	0.8%	-39.3%	-41.7%	4.3%
Slide	-0.1%	18.5%	-15.7%	-37.8%	-15.5%	-26.4%	-44.7%	-43.3%	-2.2%
Snap Action	1.0 %	7.5%	-6.1 %	-28.1%>	-26.2%	-2.6%	-33.1 %	-33.2%	0.3%
Tact	-7.7%	-4.0%	-3.9%	-49.2%	-26.9%	-30.5%	-50.1%	-33.9%	-24.5%
Toggle	6.7%	8.3%	-1.5%	-39.4 %	-35.1%	-6.7%	-44.4%	-48.9%	6.6%
Total	1.9%	1.8%	0.1%	-35.4%	-30.4%	-7.2%	-40.5%>	-35.7%	-7.1%

When compared to the last quarter booking euros and units rose for seven of eight types with totals moving up 7% and 2% respectively. The average booking price fell in all but keylock and slide but improved nearly 5% in total, as with sales, this indicates a mix shift to higher priced types. Bookings in Q3 versus a year ago were significantly lower in total euros, units, and average booking price. For the first three quarters of this year bookings are down 37% in euros, 28% in units, and 12% in price compared to 2008.

Bookings Growth by Switch Type

	Q3 2009 Versus Q2 2009			Q3 2009 Versus Q3 2008			YTD 2009 Vs. YTD 2008
Category	Euros	Units	ABP	Euros	Units	ABP	Euros	Units	ABP
DIP	51.5%	98.3%	-23.6%	-60.5%	-56.6%	-8.9%	-60.9%	-65.1	11.7%
Keylock	26.9%	8.9%	16.5%	-20.6%	12.4%	-29.3 %	-50.0%	-27.2%	-30.6%
Push Button	1.8%	7.1%	-5.0%	-24.7%	-0.3%	-24.5%	-35.1%	-25.1%	-14.3%
Rocker	23.7%	27.9%	-3.3%	-3.3%	20.2%	-19.5%	-22.2%	-10.6%	-13.6%
Slide	6.8%	24.8%	-14.4%	-36.6%	-6.5%	-32.2%	-39.9%	-32.6%	-10.9%
Snap Action	7.2%	5.4%	1.7%	-12.4%	-11.4%	-1.1%	-29.6%	-26.3%	-4.1%
Tact	-8.8%	-7.6%	-1.3%	-35.5%	-5.9%	-31.5%	-43.1%	-23.0%	-26.7%
Toggle	40.7%	43.4%	-1.9%	-25.6%	-20.6%	-6.2%	-49.7%	-54.8%	8.9%
Total	6.9%	2.2%	4.6%	-28.3%	-17.0%	-13.6%	-37.1%	-28.5%	-12.2%

The graph below shows total quarterly indexed sales and bookings in euros and units for the reported data since Q3 CY 2007. Sales and booking euros and units were at a period high in Q1 of 2008. Since then all sales and booking measures moved lower for the next five quarters and moved higher in Q3.

Book-to-bill euros and units have both been above 1.0 since Q4 of last year. The ABP-to-ASP ratio moved above 1.0 for the first time this year.

For the period, booking prices peaked in Q4 of 2008 and fell back in Q1 and Q2 then recovered some in last quarter. Selling prices jumped up to a two year high ending four quarters of decline in Q4 of last year and slipped a bit in Q1, fell sharply in Q2, and held nearly unchanged in Q3.

How They Compare

Year to date the North American market is down 38% in sales dollars while Europe is down 40% in euros. Bookings are down in value around 38% for both regions. Prices have held up better in North America with selling prices down just over 1% for the year compared to a 7% drop in Europe. Booking prices in Europe fell 12% from last year and lower by 9% in North America. Both regions are suffering similar and painful declines.