Circuits Assembly - March 2008 - (Page 17)

W TCH A Peripheral Push Trends in the U.S. electronics equipment market (shipments only). % Change Dec.* YTD Oct. Nov.r Computers and electronics products Computers Storage devices Other peripheral equipment Nondefense communications equipment Defense communications equipment A/V equipment Semiconductors Components1 Nondefense search and navigation equipment Defense search and navigation equipment Medical, measurement and control rRevised. Market Edited by Chelsey Drysdale Report: Auto Electronics Slowing 1.1 -0.8 -9.2 3.1 -0.2 1.7 -0.7 -3.7 2.7 24.4 3.0 4.7 2.2 -6.2 5.1 -1.1 -8.0 -2.7 14.4 18.3 -2.4 8.1 -1.5 4.8 -0.1 0.5 1.8 -5.4 3.4 12.6 5.0 -0.7 -0.9 3.9 0.7 -3.3 -0.6 2.3 -7.5 12.1 4.4 -13.5 4.7 -8.8 1.0 -8.6 4.0 -1.4 LOS ALTOS, CA – Softening demand for vehicles will slow automotive electronics growth from 8.1% in 2007 to 5.6% in 2008, Henderson Ventures (hendersonventures.com) reports. The pace will then accelerate to 7.9% in 2009 and 10.5% in 2010, when global automotive electronics production is forecast to reach $140 billion. This year’s unit slowdown will be felt all over. For example, Chinese output growth will slow from 25.8% in 2007 to 15.5% this year. Potential car buyers increasingly want onboard access to all entertainment electronics and gadgets they have at home, as evidenced by the profusion of video displays, MP3 player ports and power outlets. In short, increasing electronics content will help offset meager vehicle growth this year, Henderson reports. *Preliminary. 1Includes semiconductors. Seasonally adjusted. Source: U.S. Department of Commerce Census Bureau, Feb. 4, 2008 Plasma Market Picture Mixed EL SEGUNDO, CA – Worldwide sales of plasma displays are expected to grow minimally through 2011, reaching $7.64 billion, virtually unchanged from $7.63 billion in 2006. However, shipments will double to 20.1 million by 2011, a CAGR of 14.9% from 2006, research firm iSuppli (isuppli.com) says. Third-quarter shipments of PDPs, used mainly in TVs, reached 3 million units worldwide, up 15% year-over-year. A balanced supply situation is likely to prevail in 2008 and beyond as PDP makers are cautious about adding capacity, the research group claims. New Year Brings Production Upturn TEMPE, AZ – The manufacturing sector gained momentum in January, as the PMI rose 2.3 points, signaling a stronger performance compared to the seasonally adjusted 48.4% recorded in December. This represents a return to the recent trend of slow growth in manufacturing, as the PMI has averaged 50.2% for the past six months. A reading above 50% indicates the manufacturing economy is generally expanding. A PMI above 41.1%, over time, generally indicates a growing economy. The January PMI correlates to a 3% annual hike in GDP. The production index rebounded 6.6 points during the month, while new orders decline slightly to 49.5%, noted Norbert J. Ore, a spokesperson for the Institute for Supply Management (ism.ws), which issued the report. Employment slipped 1.6 points, inventories were down, but pricing was up significantly. The Computer and Electronic Products category reported contraction during the month. Sept. PMI New orders Production Inventories Customer inventories Backlogs 52.0 53.4 54.6 41.6 50.0 51.0 Oct. 50.9 52.5 49.6 47.2 54.0 46.0 Nov. 50.8 52.6 51.9 46.9 49.0 41.5 Dec. 48.4 46.9 48.6 45.4 51.5 43.0 Jan. 50.7 49.5 55.2 49.1 49.5 44.0 Higher Labor Costs, Higher Profits? BEIJING – China’s recent labor laws might actually prove a boon to larger companies such as Foxconn (foxconn.com) and Yue Yuen Industrial Holdings (yueyuen.com), analysts say. Labor laws enacted in January could drive employers’ costs five to 40% higher, according to industry estimates, because conditions have been set with regard to severance pay, medical, retirement and housing benefits. Yet the laws could provide a long-term boost to large manufacturers because they already pay above-regulation wages and smaller competitors could have a tough time keeping up, an analyst for ABN Amro (abnamro.com) says. Many employers are also fearful about harsher regulations curbing overtime. The situation also concerns workers, as many took advantage of lax enforcement to log about 80 hours a month in overtime. Source: Institute for Supply Management, Feb. 1, 2008 Industry Market Snapshot Book-to-bills of various components/equipment. Aug. Semiconductor equipment1 Semiconductors2 Rigid PCBs3 (North America) Flexible PCBs3 (North America) Computers/electronic products4 Sources: 1SEMI, 2SIA Metals Index Oct. 0.80 4.58% 1.08 1.10 4.98 Bureau, Nov. 0.82r 4.39%r 1.06 1.02 4.97r Dec. 0.89p 3.27%p 1.01 1.00 4.96p Date LME Cash Seller and Settlement for Tin LME Cash Seller and Settlement for Lead Handy and Harman Silver (COMEX Silver) LME Cash Seller and Settlement for Copper 11/12/07 $7.12 $1.58 $215.79 $3.07 Price Per Lb. 12/10/07 1/07/08 $7.64 $1.14 $213.94 $3.04 $7.44 $1.21 $224.57 $3.14 2/11/08 $7.69 $1.37 $251.64 $3.55 Sept. 0.79 4.39% 1.08 1.08 4.90 3IPC , 4Census 0.82 2.73% 1.06 1.07 4.94 (3-month moving average growth), ppreliminary, rrevised circuitsassembly.com Circuits Assembly MARCH 2008 17 http://hendersonventures.com http://isuppli.com http://www.foxconn.com http://www.yueyuen.com http://abnamro.com http://circuitsassembly.com

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Circuits Assembly - March 2008 Caveat Lector Letters Industry News Market Watch Talking Heads Focus on Business On the Forefront Screen Printing What Drives the Crowd? Mastering ESD Control in Automated Handling Systems Beating the RoHS Heat Trade Secrets True to Its Roots The Road Abroad - Strategic Alliance or Greenfield Facility? Tech Tips Wave Soldering Test and Inspection Process Doctor Pb-Free Lessons Learned Getting Lean Materials World Equipment Advances Apex Product Preview Ad Index Assembly Insider Technical Abstracts

Circuits Assembly - March 2008

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