Cary, N. C. -- Despite steadily increasing demand from several sectors, currency valuations, particularly the Yen, Won and NT$ to the U.S. dollar are resulting in price erosion and lower revenue growth in the passive electronic components industry, according to new research from Paumanok Publications Inc.
A key finding of the report, "Passive Electronic Components: World Market Outlook: 2015-2020 ISBN #1-893211-99-1 (2015)," indicates that unit demand for capacitors, resistors, and inductors have been growing steadily in the second half of 2014 and the first half of 2015, primarily driven by demand from several sectors including smartphone, tablet, automotive under-the-hood, commercial aerospace, medical implant, and specialty industrial.
“However, the weakened Yen, Won and NT$ to the U.S dollar is creating excessive price erosion in all world regions where vendors compete, thus creating almost no growth when measured globally,” according to the report.
“Unit shipments are steady but the value of those shipments have been significantly affected by currency valuations, especially the yen to the U.S. dollar, which is benefiting companies reporting in yen, while vendors reporting in U.S. dollars, Euros, RMB, Won and NT$ are showing anemic Y0Y growth rates as a result,” said Dennis M. Zogbi, CEO, Paumanok Publications.
The report also finds that lead times for passive components are returning to a normalized level. The collective lead time index had been in a volatile state on a month-to-month basis but has been consistently improving since May 2014, continuing into May 2015. “The lead-time index, which shows the average time in weeks that it takes for a passive electronic component manufacturer to deliver an ordered part to a customer, is extremely sensitive and responds to various external stimuli that are sometimes natural but usually manmade,” according to the report.
One of the key trends cited is a move by many component manufacturers toward value-added and applications-specific end-use market segments, such as the Internet of Everything (IoE), 3D printing, and space electronics, that require in many cases added tooling and captive intellect encompassing a granular understanding of high voltage, high frequency and harsh environment end-use markets, technologies and opportunities.