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Connector Industry Forecast

11 September 2009 845 views No Comment

Bharatbook.com pleased to announce a new report on “Connector Industry Forecast” into its market report catalogue for reselling.

Bishop & Associates publishes two connector forecasts each year. Each eight-chapter report provides an in-depth, and detailed forecast of the worldwide connector Industry. In addition to the detailed forecasts for each region of the world (North America, Europe, Japan, China, Asia Pacific, ROW), an industry overview is included which provides current market trends, industry book-to-bill ratios, and outlook narrative. In the last twenty-five years, 1980-2008, the connector industry has recorded only four years in which sales declined (1985 = -2.5%; 1992 = -2.2%; 2001 = -19.1%; 2002 = -9.6%)

In 2001, connector sales declined -19.1%. That’s the connector industry’s historical worst year.

The 2001/2002 downturn was mostly in technology, and was related to the dotcom bust and high inventory levels caused by over confidence in future demand for electronic products related to the telecommunications and computer market sectors. The U.S. Federal Reserve took action by lowering interest rates, but there were not massive government programs implemented to improve the economic environment. Basically, the market place worked through over capacity and excess inventory issues without a significant amount of government intervention.

This time around is different. The downturn is broader based affecting all market sectors and all major producing countries. The housing bubble started the downturn that motivated financial institutions to become heavily invested in sub-prime mortgages that were defaulted as housing prices began to fall. Governments around the world initiated bail out programs to keep the financial system from “locking up”. The level of government intervention and the massive amounts of liquidity being pumped into the system is unprecedented. In our opinion, these actions will probably prevent this downturn from being as steep as the -19.1% declines in sale suffered by the connector industry in 2001.

Here is how we believe 2009 will play out:

4Q08 will result in world sales of about $8,545 million, or -23.2% below sales of $11,126 million achieved in 4Q07. Note, at the time of this publication we do not have results for December. However, we have anticipated bad results in December and have factored this into our calculations.

1Q09 world connector sales will be very weak. We believe at approximately the same level as 4Q08, or around $8,545 million world connector sales. Sequentially flat to 4Q08 but down -25.4% to 1Q08, the year-over-year comparison.

Sequential improvement in connector sales will begin in 2Q09 and continue in 3Q09 and 4Q09. We estimate 2Q09 at $9,000 million, 3Q09 at $9500 million and 4Q09 at $10,000 million.

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