Despite a predicted outlook improvement for October from the September Electronic Component Sales Trends (ECST) survey from the Electronic Components Industry Association (ECIA), actual results for electronic components in October underperformed, continuing a trend that has plagued the supply chain since July.
However, November points to major improvement that could lead the way to prolonged growth for the industry in 2024.
According to the ECIA, overall sales sentiment for electronic components in October came in between 86.7 and 90.3, well below the 100-point threshold that indicates growth. The October sales sentiment came in about 2.1 points over September to reach 88.8. On average, sales sentiment results scored about 5.9 points below expectations in August, September and October.
Looking to 100
The October ECST shows the overall component score could potentially reach about 100 in November with the semiconductor category leading the way with a 111.1 score. Semiconductor subcategories are relatively more conservative with 99.3 points.
If these scores hold for November, it would be the strongest result since June 2022, ECIA said. As a result, the electronic components sector stands on the brink of passing the breakeven point by the end of the year with a potential to return to growth at the beginning of 2024.
Widening disconnect
The ECIA has been documenting a chasm between the sales sentiment of manufacturer representatives, manufacturers and distributors since April. The disconnect is hard to identify but the ECIA said it may be due to how each of these different sales bodies see the world and how they are aligned.
Still, in the October survey, the disconnect widened dramatically as manufacturing representatives plummeted by nearly 10 points between September and October while distributors and manufacturers remained relatively stable during the month. This comes after the three bodies came closer in the previous months.
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.
