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| Viewpoint | ||
February 10, 2020
VIEWPOINT 2020: Asif R Chowdhury, Senior VP, Marketing & Corporate Business Development & Japan Business, UTAC
Minus memory, part of slow 2019 was due to slow mobile handset sales which is one of the dominant users of semiconductor products. Beyond that, we did see some worrisome trends perhaps due to the geopolitical uncertainty, such as tariffs, which may linger as we go into 2020. For example, the US PMI index went below 50 in 2H19 for the first time since August of 2016. China PMI index has been below 50 since December of 2018. This indicates a contraction of the manufacturing sector. Automotive semiconductor market, which has been a shining star with anywhere between 6% and >10% growth YoY and expected to have a >6% CAGR thru the next five years, did poorly in 2019, especially in the China market. The latest overall forecast for the first quarter indicates the beginning of a “normal” first-quarter and semiconductor market cycle with the numbers well above the 1Q19 numbers. There is indication that the continual high IDM inventory days in 2019, well over 100 days, is coming down to more normal levels. On the product side, 5G technology is definitely going to drive demand in 2020. Automotive demand is also expected to return to normal growth levels, especially with the growth and proliferation of electric and autonomous vehicles. A US election year correlates well with an overall industry (and market) growth year which will drive semiconductor demands. However, with the geopolitical uncertainty still looming strong, there are risks to the market growth. Everything else being equal, I expect to see growth for semiconductor market in 2020. Asif R Chowdhury, , , Senior Vice President, Marketing & Corporate Business Development and Japan Business UTAC http://www.utacgroup.com |
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