European semiconductor distribution sees prospects for healthy growth in 2010 -

European semiconductor distribution sees prospects for healthy growth in 2010


LONDON — 2009 proved to be one of the worst years of European semiconductor distribution since the 1980’s with a total decline of 24 percent according to latest figures from the Distributors’ and Manufacturers’ Association of Semiconductor Specialists (DMASS).

Although the sales drop narrowed over the second half of the year, by a quarterly comparison the distribution market in Europe lost around 40 percent of its value since the first quarter of 2007.

In the fourth quarter of 2009, the decline narrowed to 10.7 percent over the fourth quarter of 2008 and the quarter ended with € 960 million of combined sales

“The worst effects of the crisis seem to be over, for the moment, and our industry returns to its normal cyclical behaviour, from buying freeze directly to allocation,” said Georg Steinberger, Chairman of DMASS. “The current booking situation suggests a healthy growth for at least the first half of 2010. And it seems that the current market swing is not entirely driven by inventory correction. Combined with the fact that we are comparing against a very bad year, by all standards, 2010 is set for double-digit growth.'

The growth rates in the fourth quarter ranged from +0.4 percent in Iberia to -17.7 percent in the UK and rest of Europe compared to the fourth quarter 2008.

Germany as the biggest market declined by 9.6 percent to €314 million, Italy by 11.2 percent to €104 million, France by 15.8 percent to €78 million and UK declined 17.7 percent to €83 million.

Eastern Europe in total ended at €111 million, down 6.1 percent and the Nordic region (Norway, Sweden, Finland and Denmark) at €87 million down 11.5 percent. Benelux, Iberia, Poland and Czech Republic even finished positively over fourth quarter of 2008.

“A quarterly view does not really reflect the overall situation of one specific country,” said Steinberger. “Over the entire year all regions and countries suffered almost likewise, regardless of the electronics industry structure there. The only country with a less than 10 percent decline over the year was Poland, but with its heavy dependence on contract manufacturing this could change in a heartbeat, even during a year of recovery.”

The only major product group that suffered less than 20 percent decline over the entire 2009 was memories. While analog, opto and programmable logic all ended up slightly below the average decline for the entire year, power, MOS micro and other logic landed around the -28 percent mark.

Flash memories (-1.7 percent), LEDs (-11.6 percent), DSPs (-15.8 percent) and RF Discrete (-18.7 percent) were the products with the least decline over 2009 while DRAM managed 1.5 percent growth.

“The past product development does not really tell us anything of an industry trend, apart from the fact that EPROMs seem to become a dying technology altogether,” added Steinberger. “The current booking hype goes across all segments and technologies, from commodities to 32-bit MCUs.”

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Related links and articles:

European chip distribution sees steep decline and a bit of hope

DMASS records steepest drop in semiconductor sales for 20 years

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