What's Happening in High-Tech Supply Chains
Staff -- Purchasing, 4/18/2002
- Semiconductor revenue will be flat to minus 5% this year, predicts market researcher Dan Niles at Lehman Bros. He says the chip industry is still struggling with weaker-than-expected demand, noting that orders fell 9% between January and February and shipments declined 13%. Niles says that while semiconductor revenues may have bottomed out in first quarter, "the recovery won't really start until the second half of 2002."
- Sensors are becoming a hot buy in the electronics industry. Sensor-based technology was once confined to factory floor systems and rudimentary security, but is now moving into new applications in defense, reconnaissance and surveillance designs. The technology also is being adopted for use in healthcare systems, avionics and aerospace, global positioning modules, networked micro machines and wireless communications.
- Unexpectedly strong demand for digital video disk (DVD) and video compact disk(VCD) players has pushed demand for DVD chips way above forecast, according to Robert Blair, chief executive at chipmaker ESS Technology in Fremont, Calif. He says demand for video-chip products from buyers at electronics firms in the U.S., Korea and Japan "is surpassing expectations."
- Dynamic random access memory ( DRAM ) makers Hynix Semiconductor, Infineon Technologies and Elpida Memory won't make 400-MHz speed memory in the DDR-I standard. Samsung Electronics and Micron Technology have introduced DDR400 chips using DDR-I architecture. The other DRAM firms will wait for the next generation DDR-II standard to start sampling with 400 MHz speeds next year.
- Electronics component manufacturers that had focused on the communications sector have turned to such markets as automotive, instrumentation and medical equipment to boost sales revenues. Brian Althaver, vice president of Jabil Circuit's automotive group, notes that his firm and other component producers have become Tier II suppliers to auto parts firms that make climate control devices, various sensor and switch assemblies, vehicle access systems, wiper controls and cooling systems.
- Capital equipment orders have started to increase, says analyst John Geraghty at Gerard Klauer Mattison, because electronics firms increasingly are anticipating improved business fundamentals in second half 2002. Recent corporate announcements have cited higher-than-expected 2002 capital spending plans for such diverse machinery as wafer and semiconductor production units, optical networking gear, and test and measurement equipment.
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