Market Review
Relapse or recovery in 2012?
From slowing global trade to the continuing sovereign debt crisis in Europe the outlook for 2012 is anything but certain. Neil Tyler spoke to a number of companies to find out what they expected to see in 2012 and while there are concerns they see a lot of market opportunities still to be grasped
W
ith trade growth stalling in almost every major
economy and as the crisis in
the Eurozone continues to hit business confidence, the spectre of a worldwide downturn in 2012 is being raised. Certainly a sea of troubles would appear to confront business next year.
The widespread nature of the slowdown we saw at the end of 2011 is alarming analysts and business leaders alike, because it is increasingly reminiscent of autumn 2008 when world trade plunged and economic confidence collapsed.
At a time when countries are
relying on export-led growth to turn their economies around any slowdown in trade will see the competition for a share of a declining market intensifying. While Europe is struggling to deal with the sovereign debt crisis the UK is expecting economic growth to flat line over the coming six months and to return to only weak growth in the latter half of the year. For the electronics industry 2011
threw up several unexpected challenges, from Japan’s Tsunami disaster earlier in the year, to the recent flooding in Thailand which has suffered its worst floods for more than 50 years.
Disruption to the supply chain is becoming a common occurrence, and businesses need to review their supply chains and their approach to risk management. But as you’ll see from the selection of comments below there remain a significant number of trends that continue to grow the overall market opportunity for companies operating across the electronics industry.
10 December 2011/January 2012
“In 2011, two major challenges at the macro level impacted the electronics industry and high-tech component manufacturers in general. First, the earthquakes in Japan resulted in supply shortages in an industry that had already been reducing channel inventories. Second, there were downward revisions in GDP and uncertainty in future market demand resulting from sovereign debt concerns and China slowing its growth to combat inflation.
Eric Braddom, Director of Global Strategic Marketing for CPD, TE Circuit Protection
“For the wireless sector 2011 has been a year of significant and rapid change: in the mobile sector 4G/LTE is up and running and networks are looking at a future based on high performance small cells as data usage continues to grow; GPS is delivering on the promise of deep indoor location, powered by the improvements in MEMs technology; M2M communications have moved into the mainstream and moves towards standard platforms are opening up the potential for 'M2M apps' development; even in markets like the medical sector, 'mHealth' is now moving from concepts to real world devices and services with large scale trials in progress.
Components in Electronics
The flooding in Thailand, resulting in a shortage of components in the hard disc drive industry affecting a broad base of component manufacturers, is the latest challenge to the industry this year. These events have made it clear that, in the long term, manufacturers will need multiple sources of components to be better prepared to survive these natural disasters. Looking forward to 2012, one challenge to component manufacturers will be working in an industry where the largest customers will demand a diverse supply base, which means having second sources even for highly differentiated products. From the perspective of circuit protection components, fortunately, there are several trends that continue to grow the overall market opportunity.
For example, the increasing amount of
electronics in automobiles creates the need for more and new kinds of solutions. Likewise, electric vehicles are growing in popularity and will require robust circuit protection; not just for the batteries and high voltage power systems but for charging stations, as well.
Renewable energy is becoming more
affordable. As solar and wind power solutions enter the home and small business, there is a need for new kinds of solutions to protect against failure of the batteries, as well as facilitating quick and safe disconnect of the high power connections in the system. Energy-efficient lighting, especially LED technology, is another growing trend, needing protection against thermal events and surges to optimise performance and lifecycle. The proliferation of ultra-slim, smart mobile appliances with increased power densities, faster processors, and extended battery life is another megatrend that presents many opportunities. Extremely slim sizes, increased sensitivity, and faster connector speeds (i.e., Thunderbolt technology) will make protection solutions even more challenging, but offer exciting new opportunities in 2012.”
Fraser Edwards, Business Development, Wireless Division, Cambridge Consultants
Underpinning many interesting developments have been the steps to free up ‘white space’ spectrum. Making this spectrum unlicensed has huge potential to further extend existing wireless technologies as well as opening the door to a whole new generation of innovation much like happened in the WiFi band 20 years ago.
The continued focus on standards has seen more commoditisation of wireless and the development of more wireless modules. This modularisation enables ever more growth and innovation in applications and services.
In 2012 we expect this trend of using
wireless communications as an enabler of new applications to continue. The next phase will be a drive towards the 'ease of use' of applications that include wireless technologies and a focus on the core service values of these applications, rather than simply having wireless technology as a tick-box item on a spec sheet.
2011 has cemented 'connectivity' as one
of the pre-eminent technology requirements for products and services across nearly every market and industry. In 2012 we expect to see the fruits of this shift - and perhaps even something approaching the much-discussed ‘Internet of things’.”
www.cieonline.co.uk
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