The first half of 2005 China's electronic components industry profits decline

Analysys International data show that in 2005 1 to June, the national electronic components market reached 413 billion 500 million yuan, up 22% over the same period last year, the highest for the same period in history. The rapid expansion of market size of electronic components, and provide a broader space for the development of Chinese electronic components industry, this year 1 to June, Chinese electronic components industry sales reached 331 billion 900 million yuan, an increase of 16.6% over last year. But at the same time increase sales, profits fell from 15 billion 200 million yuan to $11 billion 500 million, down by 24.4%.

Analysys International recently published "a comprehensive analysis of China electronic components market analysis report 2005": the decline of domestic electronic components industry profits, should be mainly attributed to the average price continued to decline, as well as energy, raw material prices caused by rising costs increase; from the perspective of industry, the semiconductor industry in a cyclical downturn however, electric vacuum industry due to the change of market demand structure caused by lack of demand, is an important factor in the decline in profits.

Electronic components market consists of two parts: electronic component market and electronic device market. Electronic components industry sales increased from 158 billion 800 million yuan to $193 billion 500 million, an increase of 21.9%, profit rose from $9 billion 460 million to $8 billion 790 million, an increase of 7.6%. The electronics industry, although sales increased from 125 billion 800 million yuan to 138 billion 400 million yuan, but profits have dropped significantly, decreased from 6 billion 410 million yuan to 2 billion 30 million yuan, down to 68.3%, which is an important reason to cause the electronic components industry overall profit decline.

Analysys forecast, driven by demand, the second half of 2005, the market size of electronic components will be further expanded, the proportion of the two major market remained stable. Meanwhile, due to factors such as the semiconductor industry to pick up, the overall profit of the electronic components industry is expected to stop the downward trend, improve.

With the increasingly fierce competition in the electronic components industry, the price can continue to decline in space is getting smaller and smaller. Channels, services and other non price factors in the role of competition will become more and more obvious. Electronic components manufacturers should adjust business strategy, on the premise of controlling costs, should pay more attention to the non price channels, service and other factors, and strive to rely on various channels and services to gain competitive advantage, so as to get higher profits.

Analysys International believes that manufacturers should also pay close attention to user needs change, on the one hand, identify potential demand will help guide enterprises through product innovation, is expected to accelerate the pace of innovation to meet the new demand on the market; on the other hand, it also can make the enterprise timely notice the changes in demand, effectively avoid the decline in demand the market risk.