Application Forecasts and Market Shares

ECIA: Growth in IC sales sentiment in August

22 September 2023
Source: ECIA

The electronic component sales sentiment continued to improve in the month of August jumping 7.3 points over the July index, according to the latest Electronic Component Sales Trends (ECST) survey from the Electronic Components Industry Association (ECIA).

Sale sentiment in August reached 90.3, continuing a trend of improving results that began in June, ECIA said.

The good news is that the ECIA outlook for the September electronic component index will maintain growth to reach 94.9. This will be the best score since February of this year and an increase of 22.5 points from the May 2023 survey.

Different sectors are seeing different expectations in August. Electromechanical/connectors failed to meet expectations in August only slightly improving over July. While at the same time, semiconductors beat expectations with very improved scores between July and August.

ECIA said it is possible that sales sentiment for all categories could top 100, seen as the magical high demand number, sometime in the fourth quarter. This could signal the potential return to broad-based growth beginning in 2024.

Gap continues

As reported for the past few months, the sales gap between manufacturers and manufacturer representatives continues.

Product sales sentiment for manufacturers has come in between 8.1 and 9.9 points higher than overall average between July and September. For manufacturer representative scores are between 8.0 and 16.2 below the overall average. Meanwhile, distributor scores are close to the overall average.

This difference first began in April and has continued through August. ECIA believes the differences are due to how divergent the electronic components world with manufacturers is compared to others. One explanation could be that manufacturers are seeing stronger performance in direct business while inventory balancing in the distribution channel continues to weigh on distributors, ECIA said.

Renewed growth

The results from ECIA’s quarterly ECST survey show that a renewed quarter-to-quarter growth potentially could begin in early 2024. Sales sentiment for balanced sales between Q2 and Q3 was 44% but sales equilibrium is now expected in Q4.

For end markets, an optimistic outlook is seen across all sectors with the biggest improvements expected in consumer, industrial, medical and computer electronics. Avionics/military/space, automotive and industrial electronics are all predicted to cross the 100-point threshold in September.

About the ECIA ECST report

The ECST survey provides highly valuable and detailed visibility on industry expectations in the near-term through the monthly and quarterly surveys. This “immediate” perspective is helpful to participants up and down the electronics components supply chain. In the long-term, ECIA shares in the optimism for the future as the continued introduction and market adoption of exciting innovative technologies should motivate both corporate and consumer demand for next-generation products over the long term.

The complete ECIA ECST report is delivered to all ECIA members as well as others who participate in the survey. All participants in the electronics component supply chain are invited and encouraged to participate in the report so they can see the highly valuable insights provided by the ECST report.

The monthly and quarterly ECST reports present data in detailed tables and figures with multiple perspectives and covering current sales expectations, sales outlook, product cancellations, product decommits and product lead times. The data is presented at a detailed level for six major electronic component categories, six semiconductor subcategories and eight end markets. Also, survey results are segmented by aggregated responses from manufacturers, distributors and manufacturer representatives.

Interested in reading the entire ECST report? Click here for more info.

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