source: Electronics Weekly article
By Richard Wilson 7th December 2015
It has been a difficult year for component suppliers in the UK and will be little respite next year. In 2015, the distribution components market in the UK/Ireland was 1% smaller than 2014.
And next year, Afdec, which represents authorised distributors, says is predicting a market no better than “flat” in 2016.
Analysis of the consolidated returns from the association’s membership indicate that
The distribution market in 1916 will be £1.1bn within a total available market of £2.9bn.
The actual predicted market figures for next year could be as bad as -2% but the mid-point is 0%.
The conclusion is that the UK manufacturing sector is coming under pressure, largely from outside influences.
Afdec and ecsn chairman Adam Fletcher believes the current spate of mergers and acquisitions in the global semiconductor industry could be having an effect.
“The frenetic pace of merger and acquisition activity in the electronic components markets is likely to slow in 2016 but the outcome of this consolidation will take another 18 months to work through. I suspect that in 2016 we will continue to bump along at the bottom of the recovery cycle with much stronger consistent growth likely into 2017/8,” said Fletcher.
According to Aubrey Dunford, ecsn Market Analyst: “Whilst Automotive, Aerospace and Defence markets have recovered well the critical Industrial components market on which much of Europe relies on to drive growth has continued to falter.”
“Higher growth in some sectors of the market such as Automotive where Distribution lacks a firm foothold suggests that the TAM should increase by more than the DTAM but many of these electronic systems are designed in the UK but manufactured in Eastern Europe so in real terms, the TAM has declined by (5%) to £2.74Bn,” Dunford continued.
According to Dunford: “Until the B2B ratio recovers beyond 1.1:1 for a sustained period there’s no way growth can return to the market,” said Dunford. “We believe that it will take some months for the supply network to come back into balance. In the meantime with good inventory availability and short lead-times, the electronic components market is well positioned to support its customers’ requirements,”