The semiconductor industry has a 40% chance of a recession again

Due to the economic crisis and heightened consumer pessimism, market research firm IHS iSuppli recently revised its forecast for 2011 semiconductor market growth rate, considering that the market’s revenue this year will reach US$ 313.3 billion, a growth rate of 2.9%; this is IHS iSuppli revised this forecast for the second time in two months. The agency’s forecast for 2011 growth rates for the global semiconductor market in June and August was 7.2% and 4.6%, respectively.

In addition to IHS iSuppli, several market research institutes have revised their forecast for 2011 semiconductor market in recent weeks; Bill McClean, general manager of IC Insights, which originally forecast a semiconductor growth rate of 10% in 2011, now believes that this year's semiconductor market and 2010 Year-on-year performance will be flat, or only 5% growth.

Gartner, another well-known market research firm, originally expected 2011 semiconductor market revenue to grow by 5.1% from 2010, and now believes that the market will show a recession this year; in addition, Semico Research’s latest forecast also indicates that the semiconductor market will decline by 2% in 2011. The agency's previous forecast was a 6% increase.

Dale Ford, supply chain analyst for the electronics and semiconductor industry at IHS iSuppli, said that the weak economic sentiment has already affected the electronics and semiconductor industry before the key year-end Christmas holiday: “Although 2011 will face economic challenges, consumer spending should still be The demand for electronic products can grow at a reasonable level if the situation is stable.”

Ford pointed out: "Unfortunately, the acceleration and instability of the economic recession has become the main reason that will lead to a dull performance in the electronics and semiconductor industries in 2011." He expects that the impact of stagnant economic growth will continue in 2012. The chip market was dragged down in 2011; IHS iSuppli currently forecasts a global growth rate of 3.4% in the semiconductor industry in 2012.

IHS iSuppli pointed out that this year's weak growth performance in the electronics and semiconductor markets is timing, and is in contrast with the sudden industrial recession that began in the middle of the third quarter of 2008; at the time, the global recession caused the global semiconductor industry camp to shrink 5.3% in 2008. In 2009, there was a 11.6% decline. However, the agency also pointed out that as manufacturers adopt flexible business adjustment policies this year, it is expected that the semiconductor market will avoid the recession.

“The memory market experienced a tragic recession in 2008 and 2009. It is still fresh in memory that manufacturers in the semiconductor supply chain have adopted defensive strategies to actively reduce inventory and production capacity.” Ford said that because of this, IHS iSuppli believes in the semiconductor industry. In the third quarter, it will maintain a low double-digit growth, which will save the entire year from recession.

Most Japanese semiconductor suppliers experienced severe revenue decline due to the 311 earthquake and tsunami in the second quarter of this year, but they resumed production within a short period of time. IHS iSuppli pointed out that the Japanese market and the electronics industry are currently in demand. The recovery from shipments is expected to bring mild growth momentum to the semiconductor market in the second half of the year.

However, IHS iSuppli also stated that although the Japanese market is recovering, the possibility of a global economic recession cannot be ignored; the agency believes that the chance of another economic recession is 40%. And if the economic climate really starts to decline this year, the semiconductor industry growth rate in 2011 is most likely to be flat.

IHS iSuppli warns that what is more worrying is the amplification effect caused by the decline of the electronics industry chain, which may lead to a highly unstable supply and demand situation in the semiconductor industry that will continue into 2012 and even 2013 will not stabilize.