Global Electronics Trending Upward

Global electronics production is on a generally positive trend. The chart below shows three-month-average change versus a year ago (3/12 change) for electronics production by country or region in local currency. Total industrial production is shown for Europe and South Korea since electronics production data is not available.

China electronics production growth has remained strong, with April 2015 3/12 change up 11.4% from a year ago. China growth has been 10% or higher since December 2009. Taiwan electronics production has been volatile over the last few years, with 3/12 change ranging from increases over 40% in late 2010/early 2011 to declines approaching 30% in late 2012. Taiwan 3/12 change has been positive for the last eight months, with March 2015 up 7.3%.

Japan electronics production has been on a downward trend for about 14 years as production has shifted to China and other countries in Southeast Asia. Current production (in Japanese yen) is only about one third of year 2000 levels. However Japan is currently undergoing a short term recovery, with March 2015 three-month-average production of 449 billion yen up 44% from the recent low in June 2014. March 3/12 change was 1.7% compared to a 17% decline in November 2014.

Electronics production in the United States and industrial production in Europe and South Korea have demonstrated steady but slow growth. 3/12 change turned positive in Europe in October 2013, in South Korea in December 2013, and in the U.S. in January 2014. The March 2015 3/12 change was about 1% for each region.

We at Semiconductor Intelligence (SC-IQ) have developed a Global Electronics Index based on data from individual countries and regions. The chart below shows three-month-average change versus a year ago for the Global Electronics Index compared to global semiconductor shipment data from World Semiconductor Trade Statistics (WSTS). In 2011 both electronics and semiconductor growth were decelerating following the strong growth of 2010. Semiconductors decelerated more quickly and went more negative than electronics. Semiconductors and electronics both turned positive in mid-2013. Semiconductor growth in 2014 (averaging 10%) outran electronics growth (averaging 5%). In February and March 2015 3/12 change for both semiconductors and electronics were in the range of 5% to 6%.

Semiconductor Intelligence projects the Global Electronics Index will continue to show moderate acceleration for at least the next several months, with year 2015 growth of about 6% to 7%. In the long term, semiconductor growth is a few points higher than electronics growth due to increasing semiconductor content in electronics. Our March 2015 forecast was 8% growth for the global semiconductor market in 2015. The current electronics production data still supports this forecast.