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Jasper Huitink : October 4th 2005 - 21:45 CET

China produces 24% of consumer electronics


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Research and MarketsChina produces 24% of consumer electronics : Research and Markets has announced the addition of World Electronic Industry: European Market and Production 2004 - 2009 to their offering. The recent evolution of the world electronics markets has confirmed the major trends that had appeared by the end of 2003: Over 60 percent of consumer electronic output now consists of mass-market products. This enables a fast penetration of new products worldwide, reducing the time between introduction and saturation, and increasing the need for continuous innovation. In the opinion of Research & Markets mass-market products and professional products are two very different segments.
China produces 24% of consumer electronicsChina electronics - 5% growth per year
The emergence of China in electronics has become a reality in the last two or three years. China has become a both a considerable market and a serious competitor for the other electronics industries in the world. China will, in 2009, produce 24% of the world electronics (20% in 2004). Over the 2004-2009 period, the world electronics industry will grow by close to 5% per year, with a relatively even profile, although 2009 is expected to be a relatively poor year.

Research and Markets - Digitalisation
Digitalisation has led to the convergence of segments that used to be differentiated as "computer", "telecoms" or "consumer". The resulting "converged" products are mobile, networked and (in most cases) interoperable. The business model is changing. Buyers demand the product they want (innovative, fashionable, cheap, easy-to-use and reliable), and competition between suppliers is fought on this terrain. The multiplication of new digital products, applications and solutions makes the electronics market globally more stable and more competitive, and less dependant upon specific products categories (as TVs, PCs or mobile phones).

Consumer electronics - Industry growth
Automotive and consumer electronics will lead the overall industry growth with an annual growth of respectively 7.3 and 6.7%. By 2009 audio-video will represent 14.5% of the total electronics industry, data processing 23%, telecommunications 24%, aerospace and defence 6,5%, automotive 9%, and industrial and medical electronics 16%. Home appliance electronics at 6,9% are over-estimated, as the figure includes not only the electronic content, but the whole value of the appliance.

Automotive electronics leads the industry
Automotive electronics will continue to lead the whole industry in terms of growth, pulled by the diffusion to mid- and low-range cars of applications that were reserved to the top-of-the-range, rather than by real innovation. The industry is facing a new challenge with interference problems due to the multiplication of new applications. This problem has generated a number of initiatives such as AUTOSAR that aiming to define standards, especially in the software area.

Electronics market - Price drop
The acceleration of consumer electronics market growth is linked to an innovation boom, a drop in prices and the opening of new markets. The innovation boom is directly related to digitalisation which is allowing a total renewal of consumer electronics products (TVs, cameras, printers), that are favourably affected by convergence. The drop in prices has been a constant trend in consumer electronics and mass-market products for decades. It is mostly due to optimisation and rationalisation of production and design, and to component innovation and digitalisation. In comparison to these factors production localisation in Asia or Eastern Europe is a marginal and transient factor.





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