Prices stay stable as orders will increase
By Staff -- Purchasing, 4/22/1999
Parts availability continues to run high and prices are mostly steady, according to Purchasing Magazine's monthly survey of electronics buying conditions. Although buyers say that their order volumes will increase over the next 90 days, there is little evidence that the buyers' market will end in the second quarter.Sixty-seven percent of buyers report that prices are mostly steady while 22% say tags are still falling. That's no surprise because more than 80% of purchasers report that there are no items in short supply and 78% say leadtimes are holding steady. However, 65% say they expect to increase orders in the next 90 days which is good news for component manufacturers and distributors, but it is unclear what effect it will have on availability since there is plenty of capacity.
While most analysts have forecast growth in the semiconductor market this year, that growth may be stifled by consolidation and supplier-base reduction. Many OEMs have reduced their supplier base, placing larger orders with fewer suppliers to get significant discounts. In addition, consolidation in contract manufacturing has resulted in larger orders placed by fewer CMs and a lower per-piece price for components.
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