European Semiconductor Distribution (DMASS) deteriorates further

EMEA semiconductor distribution sales down by 32.6% in Q2/2009.  Steepest decline in DMASS history. Germany and Italy hit hardest among major regions. 

London, August 14, 2009 – The first six months of 2009 displayed a record decline of components sales through distribution in Europe. Never since the foundation of DMASS 20 years ago has the organisation recorded a bigger downturn. Q2/2009 ended with 869 Million Euro, representing a decline of 32.6% over the same period one year ago. The first half of 2009 ended with 1.86 Billion of consolidated DMASS sales, a decline of 29.2% versus H1/2009.

Georg Steinberger, Chairman of DMASS, commented: “Taking into account the booking situation of 2008 and early 2009 it was clear that Q2 would end in a disaster across all regions and product groups. Our hopes for the remainder of the year, however, are less pessimistic. Book-to-Bill ratios in July were steadily high and have created some cautious confidence in the return of the market. In some cases we even expect availability bottlenecks. It will take some years, though, to get back to record sales levels of early 2007, which were 40% higher than the last quarter.”

Of the major regions, Italy (-40.3%) and Germany (-34.3%) were affected most severely, while France (-27%) and the UK (-28%) did considerably “less badly”. Switzerland (-38.4%) and Eastern Europe (-36.6%) stayed below average while Benelux (-23.6%), Iberia (-28.7%), Austria (-29.6%) and the Rest of Europe (-17.9%) did better than average. In absolute numbers, the German market ended in Q2 at 282 Million Euro, Italy at 99 Million Euro, the UK at 80 Million Euro and France at 78 Million Euro.

Georg Steinberger: “The crisis goes through all regions. It is significant to see that lower cost production regions like Eastern Europe suffered more than the core regions, meaning that the amplitude of market swings on average is much higher the further down you go in the electronics production food chain. Best example for this thesis is Israel which in the first half of 2009 only declined 21%, 8% less than the EMEA average!”

All major product groups declined massively in Q2/2009 compared to Q2/2008. Only Memories (-18.2%) and Programmable Logic (-25%) came in above average, all others either declined between average and 47% (Sensors). Analog and MOS Micro Logic, by far the biggest product groups, declined by 30.5% and 37% respectively to 244 Million € and 192 Million € respectively. Among the biggest losers were Power (-40.4%), Discretes (-38.2%) and Standard Logic (-39.1%). Just one single product group showed some steadiness – Flash Memories only declined by 2.4%.

Georg Steinberger: “Looking at the products there is not a single area without negative news, not a single product or application that seems to beat the market odds. With the summer quarter having started positively, we hope the relief continues throughout the fall to halt further market deterioration. The European electronics industry still offers many opportunities, specifically for distribution.”

DMASS (Distributors’ and Manufacturers’ Association of Semiconductor Specialists), a European non-profit organisation, is the only industry body that collates detailed semiconductor distribution market data on a quarterly basis by country and product groups such as microcontrollers, flash memories, analog components and many more. DMASS figures are collected and consolidated by Data Dynamics Ltd.

DMASS, founded in 1989, provides its members with a reliable statistical tool to evaluate their relative mass-market performance. The organisation currently consists of 33 active members and represents between 80% and 85% of the total European distribution market, depending on the regions. To continuously increase its European market coverage, DMASS welcomes new membership applications from distributors and semiconductor manufacturers.