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Edgewater Research: Electronics Supply Chain Weekly Digest

Dennis Reed
|  Created: November 17, 2023  |  Updated: July 1, 2024
|  Open as PDF

Edgewater Research

Weekly Data Points:

Global Electronics Sector:

  • S&P Global Electronics PMI: Declined to 46.9 in October from 47.7 in September, the sharpest deterioration since mid-2020.
  • Industry Challenges: Noted a significant fall in new orders, output, employment, and stocks of purchases.
  • Subsector Declines: Most notable in computing, with electronic manufacturing reducing staff for the second consecutive month.

Business Outlook:

  • China: Business confidence hit a one-year low in October, reflecting concerns over domestic and global economic growth.
  • Europe: Business confidence remains low, with forecasts cutting employment and investment, especially gloomy in Germany.
  • USA: Maintains the highest business confidence among developed economies, with +25% of businesses expecting growth.

Industry Headlines:

Automotive:

  • Amazon and Hyundai: Hyundai vehicles will be available on Amazon's site in 2024.
  • Continental: Announces job cuts in its automotive division.
  • US EV Funding: Rolls out $3.5 billion in EV battery funding amid manufacturer layoffs due to slow demand.
  • Fisker: Cuts its EV production target for 2023, citing production challenges.
  • Lucid: Announces a new $80,000 EV SUV with a 440-mile range.
  • US Auto Sales: According to the US Census Bureau, October saw a 1% decline in auto retail sales.
  • Volkswagen: Believes a €20K EV is achievable in the second half of the decade, despite cutting shifts at the Zwickau plant.
  • GM, Ford, Stellantis: Union workers ratify UAW deal.
  • Xpeng: Predicts a 2x increase in EV sales in Q4 2023, alongside a wider operating loss.

Aerospace:

  • China and Boeing: Considering ending the purchase freeze with a 737 Max deal.
  • Boeing vs. Airbus: Boeing secures 3x more orders than Airbus at the Dubai Air Show.

Datacenter/Telco:

  • Alibaba: Halts cloud business spin-off due to US chip export ban.
  • Cisco: Disappointing outlook as customers digest products.
  • Tencent: Stockpiles Nvidia AI chips, shifts focus to domestic solutions after recent ban.

IP&E:

  • MLCC Demand: TrendForce predicts slow growth in global MLCC demand in 2024.

Industrials:

  • Siemens: Forecasts slower growth in 2024 sales due to destocking in key markets like Germany and China.

Semiconductors:

  • Applied Materials: Faces stock pressure despite better results, linked to an investigation of sales to SMIC.
  • Consumer IC Demand: Not expected to recover fully until the second half of 2024, per DigiTimes.
  • China's IC Capacity: Expected to represent 33% of the global mix by 2027, with numerous fabs under construction.
  • Infineon: Reports strong results, forecasting double-digit growth in Auto IC sales in 2024.
  • Nvidia and Microsoft: Unveil new AI chips.
  • onsemi: Experiences power outage at South Korea SiC fab.
  • Samsung: Receives 4nm orders from AMD.
  • Silergy: Anticipates a prolonged inventory correction for PMICs.
  • IDC: Raises its global semis sales forecast for 2023 and 2024.
  • Tower Semiconductor: Expects a decline in Q4 revenue.

Consumer/EMS/Distribution:

  • Apple: Faces delays in replacing Qualcomm chips in iPhones.
  • China Consumer Spending: Mixed reports during Single Day shopping.
  • Huawei: Boosts China's October smartphone shipments.
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About Author

About Author

Dennis Reed is a Senior Research Analyst in Technology. Dennis started in the industry in 2005 at FTN Midwest Research on the technology & semiconductor team. In 2006, he was a founding member of Cleveland Research Company and continued to develop and extensive network of technology industry professionals in the semiconductor, distribution, memory and HDD industries throughout the world. Dennis worked at KeyBanc Capital markets in New York, on teams covering Consumer Staples and Paper & Packing companies. Dennis also brings wide level of experience working in various roles with Travelers Insurance, including Market Research and various product roles supporting business unit growth in targeted end markets. Dennis is a 2002 graduate of Ohio University with a major in Sports Management.

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