Electronic components sales sentiment continued at a strong level in October, but the November outlook indicates lowered overall sentiment ahead, according to the Electronic Component Sales Trends (ECST) survey from the Electronic Components Industry Association (ECIA).
The overall index averaged 122.2 points in October, an increase of 4 points from September’s report. However, the outlook for November is forecast to fall to 103.5 points, the ECIA said.
A score of above 100 represents growth in the ECIA report.
Startling decline
ECIA said an end of year decline is not surprising. However, the forecasted decline is alarming.
For example, passive components are in for a shocking drop as the index collapses by 26.3 points down to 93.8. Inductors and capacitors will take the brunt of this decline.
Electromechanical components and semiconductors are still expected to register above the 100-point threshold but will also suffer a tremendous drop, ECIA said. While semiconductors were one of the most stable categories in September and October, sales sentiment for semiconductors is expected to drop to the September level of 105.9.
End market plummet
End markets for October and September soared by nearly 19 points but with the November outlook, end markets are expected to plummet by 40 points to 89.4 points. All eight end-market segments scored above 100 in October; in November only four will sustain this 100-point threshold.
Increasing lead times
According to the ECIA, the last several months have shown stability with no real reports of increasing or decreasing lead times.
That all changed in the October report.
Increasing lead times for semiconductors leapt from just 7% in September to 40% in October. Passives also saw a major jump in lead times growing from 14% in September to 31% in October. Electromechanical components remain stable at about 16%, ECIA said.
The increasing lead times may see some relief because of the soft sales sentiment expected for the November report.
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 components 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 outlooks, 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 information.
