Front End | Electronic Components Supply Network
European electronic components market – Q1 ’25 overview
Despite all the turbulence in global trade caused by the actions of the current US government, the performance of European electronic components markets continues to slowly improve. But according to Adam Fletcher, chairman of the Electronic Components Supply Network (ecsn), the market is likely to continue to “bounce along the bottom” throughout 2025. Yet, in the absence of further economic shocks, he believes that stronger stable growth should return next year.
S
ystem integrators (customers) primarily choose to buy the electronic components they need from manufacturer-authorised distributors because these long-term partners can be relied upon to ship only known high-quality products with full manufacturer supply traceability. In addition, they support their customers by providing technical expertise and a wide range of value-added services, which are often enhanced by both direct and in-direct commercial support from the component manufacturers themselves. In the European electronic components supply network manufacturer-authorised distributors support over 98 per cent of the buyer / seller relationships.
In common with many technology trade associations elsewhere in the world the UK’s Electronic Components Supply Network (ecsn) is a member of the International Distribution of Electronics Association (IDEA), an ‘association of associations’ dedicated to establishing and promoting best industry practice. For over twenty years IDEA has collected a wide range of industry statistics directly from its members each month, which it compiles into reports that enable member management teams to accurately benchmark their organisation’s performance. Because these reports are broken down by subsets including component type and geographic markets the reports also provide a useful insight into overall industry trends. An example of the data IDEA compiles and shares with member organisations is contained in the bar-chart “1st QTR. 2025 TOTAL COMPONENTS Booking, Billing and Book to Bill Ratio” which should be read from
12 June 2025
left to right: The blue bars show European “Billings” (Sales Revenue Shipped and Invoiced) which from Q2’22 grew for four consecutive quarters, peaked in Q1’23, yet declined in the following seven quarters before returning to growth in Q1’25. The brown bars show European “Bookings” (Net New Sales Revenue Entered), which declined in Q2’22 and continued to decline for ten consecutive quarters before returning to (low) growth in Q1’25. The Book-to-Bill (B2B) ratio - a key industry metric - peaked at 1.66:1 in Q4’21 (a simply outrageous number and beyond anything recorded in the past forty years) but it did contract to 1.33:1 in Q2’22 and continued
Components in Electronics
to contract over the next five consecutive quarters. The shape of the B2B curve over the last two years is indicative of a steadily improving trend. Fingers crossed!
Tariffs (import taxes) on almost all electronic components were removed as part of the Global Agreement on Trade and Tariffs (GATT) signed in Uruguay in 1994, so President Trump’s threat of punitive tariffs on technology imports into the US came as a particularly unwelcome shock to all companies operating in the electronic components industry. IDEA members spent many hours considering the
impact the proposed tariff increases could have in the different geographic and economic regions and what the association’s response to both its members and local government legislators should be. In the end its advice to members operating outside the USA was to do nothing in the short term but “closely monitor the evolving fluid situation”. IDEA members in the US had an immediate and much larger problem: Tariff rates were constantly changing, as was the list of goods and the geographic points from which they applied. Fortunately, US components manufacturers and the distributors that represent them in most major markets have
www.cieonline.co.uk
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56
