Circuits Assembly - July 2008 - (Page 18)

W TCH A Semis Ascend Trends in the U.S. electronics equipment market (shipments only). % Change Feb. 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 EMS Set to Undergo Slowdown YTD 1.3 -3.7 12.1 4.6 -2.1 27.1 -12.0 -4.5 0.0 3.9 0.7 10.5 Mar.r -0.8 -4.2 1.7 2.7 1.1 4.4 -1.2 -5.5 1.0 0.8 2.2 -1.6 Apr.* 5.1 -13.6 -0.6 7.0 -4.2 -6.7 17.4 35.4 1.6 -1.7 -4.2 8.5 -8.8 -1.7 -0.1 -2.0 -1.4 12.6 -7.0 -31.2 -2.9 -17.5 -4.1 -5.4 *Preliminary. 1Includes semiconductors. Seasonally adjusted. Source: U.S. Department of Commerce Census Bureau, June 3, 2008 EL SEGUNDO, CA – iSuppli Corp. (isuppli.com) in May trimmed its long-term forecast for global EMS revenue to 8% during the 2006 to 2013 timeframe, down from its previous outlook of 9.3% growth. The research firm cited the combined size of the EMS and ODM businesses – $305 billion – which hampers growth rates. Adam Pick, principal analyst for EMS/ODM, also pointed to a deceleration at Foxconn (fih-foxconn. com), the largest player. Finally, many EMS/ODM players are rethinking their strategy of market share expansion in favor of competitive positioning and financial performance. “During the next five years, industrial forces will trigger an evolutionary transformation within the EMS/ODM marketplace,” Pick said. “Consolidation, OEM procurement strategies, alternative supplier theories, competitive collaboration networks, and new contract manufacturing strategies will affect the value chain.” Manufacturing Stalls Again in May TEMPE, AZ – Economic activity in the manufacturing sector again failed to grow in May, as the PMI was 49.6%, up one point from April, says the Institute for Supply Management (ism.ws). New orders were 49.7%, up 3.2 points sequentially, while inventories remained at 48%. Customer inventories were 47%, up two points, and backlogs were down 5.5 points sequentially, to 46%. Production bounded 2.1 points higher, to 51.2%. A monthly PMI above 50% indicates the manufacturing economy is generally expanding. A PMI over 41.1%, over a period of time, generally indicates an expansion of the overall economy. The average PMI year-todate (49.2%) corresponds to a 2.5% increase in real GDP. “In relative terms, May was down slightly from April, as the rate of contraction in manufacturing slowed,” said ISM spokesperson Norbert J. Ore. “Manufacturers find themselves caught between rising costs and weakening demand. Exports continue strong due to the weak dollar; without the weak dollar, the story would be much more negative in manufacturing.” Jan. PMI New orders Production Inventories Customer inventories Backlogs 50.7 49.5 55.2 49.1 49.5 44.0 Feb. 48.3 49.1 50.7 45.4 49.0 45.0 Mar. 48.6 46.5 48.7 44.9 51.0 47.5 Apr. 48.6 46.5 49.1 48.1 45.0 51.5 May 49.6 49.7 51.2 48.0 47.0 46.0 Display Driver Chip Market Heads to Mature Stage EL SEGUNDO, CA – Unit shipment growth for display drivers will slow to 15.1% in 2008, down from 26.2% in 2007, iSuppli Corp (isuppli.com) said. Annual growth will average about 11% from 2009 to 2011. iSuppli estimates 6.9 billion units were shipped in 2007, up from 5.5 billion units in 2006, driven by LCD TVs and notebook PCs. Another factor: active matrix TFT-LCD displays found in many mobile and handheld products. But global revenue failed to keep pace, rising 10.2% to $8.8 billion. WSTS: Global Semi Growth 4.7% in 2008, 5.8% in 2009 SEATTLE – The global semiconductor market is expected to grow 4.7% to $267.7 billion this year, up from 3.2% in 2007, according to the revised forecast of the World Semiconductor Trade Statistics (wsts.org). The WSTS lowered its projections by 4.4 points from its last forecast, in November, mainly as a result of a weak fourth quarter 2007. Demand is improving, however, leading the group to reiterate 2009 and 2010 projections of 5.8% and 8.8% growth, respectively. “The WSTS foresees a continuously growing demand for electronic products such as PCs, digital consumer appliances, mobile communications, and automotive electronics,” said Dr. Ulrich Schaefer, WSTS chairman. Source: Institute for Supply Management, June 2, 2008 Industry Market Snapshot Book-to-bills of various components/equipment. Dec. Semiconductor equipment1 Semiconductors2 Rigid PCBs3 (North America) Flexible PCBs3 (North America) Computers/electronic products4 0.85 3.27% 1.01 1.00 4.94 Jan. 0.89 1.70% 0.97 0.96 4.77 Feb. 0.92 1.35% 0.99 0.96 4.99 Mar. 0.87r 1.82%r 1.00 0.99 5.18r Apr. 0.81p 3.82%p 1.01 0.99 5.23p Metals Index Price Per Lb. Date LME Cash Seller and Settlement, Tin LME Cash Seller and Settlement, Lead Handy and Harman Silver (COMEX Silver) LME Cash Seller and Settlement, Copper 6/11/07 $6.28 $0.85 $188.29 $2.80 3/10/08 $8.73 $1.43 $294.94 $3.93 4/7/2008 $9.28 $1.34 $266.27 $3.96 5/6/08 $10.99 $1.17 $248.71 $3.93 6/2/08 $9.60 $0.89 $246.52 $3.62 Sources: 1SEMI, 2SIA (3-month moving average growth), 3IPC , 4Census Bureau, ppreliminary, rrevised 18 Circuits Assembly JULY 2008 circuitsassembly.com http://isuppli.com http://ism.ws http://isuppli.com http://wsts.org http://circuitsassembly.com

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Circuits Assembly - July 2008 Contents Caveat Lector Industry News Market Watch Talking Heads Focus on Business Global Sourcing On the Forefront Screen Printing Tech Tips Will Electronics Follow the Sun? ‘Warm’ Manufacturing Heats Up Reputation Trumps Recession, China ‘Web Circuits’ A Novel Non-VOC Conformal Coating Krypton: Benchmarking Customer Satisfaction 2008-09 CIRCUITS ASSEMBLY Buyers Guide Wave Soldering Pb-Free Lessons Learned Process Doctor Materials World SMTA Int'l Product Preview Ad Index Assembly Insider Technical Abstracts

Circuits Assembly - July 2008

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