LONDON – The World Semiconductor Trade Statistics organization has raised its forecast for the growth of the global chip market in 2011 to $314.4 billion, an annual increase of 5.4 percent. This is an increase from the forecast of November 2010 where WSTS predicted the 2011 chip market would grow by 4.5 percent.
The 2011 growth will be followed by 7.6 percent annual growth to create a global chip market of $338.4 billion in 2012 followed by another 5.4 percent rise in 2013, according to the latest figures from WSTS. The 2012 is more bullish than the 5.6 percent growth WSTS had predicted.
Such single-digit percentage growth figures are considered by some "normal" for the maturing semiconductor industry. Other forecasters say such modest growth figures would require continued declines in average selling prices (ASPs) for chips, which is bound not to happen and that higher annual growth at least in line with shipment growth of around 10 percent per year will be the trend.
It is notable that WSTS is forecasting that the Japanese market, one of four regions monitored, will contract in 2011 by 6.2 percent, while the Americas, Europe and Asia-Pacific region will see growth of 7 to 8 percent. Japan's market is expected to rebound in 2012 with 9.8 percent annual growth. Japan's slump is thought to be due to the aftermath of the earthquake and tsunami that struck northern Japan on March 11.
WSTS appears to have taken the position that the impact on chip markets will be far more pronounced in Japan than elsewhere.
Source: WSTS, June 2011
In terms of historical data the WSTS forecast follows a 2010 recovery year, driven by enterprise and consumer spending, that resulted in 31.8 percent growth to a total of $298.3 billion.
The new forecast presents a moderate growth for the year 2011, reflecting an increase of $16.1 billion over the 2010 actual. The industry is now expected to top $356.6 billion in 2013, with a 3-year compound annual growth rate of 6.13 % from 2010 to 2013, WSTS said.
WSTS is a non-profit organization of 64 semiconductor companies that between them are claimed to represent more than 75 percent of the world semiconductor market.
The latest update from the Cowan LRA forecasting model, based upon April's recently published global semiconductor sales by the WSTS, predicts a 2011 sales forecast estimate of $322.328 billion. This corresponds to a 2010 to 2011 sales growth forecast estimate of 8.0 percent. This growth number is more bullish than the WSTS's Spring 2011 forecast expectation of 5.4 percent reported above.
Remember that the Cowan LRA model is rerun and thus updated each month immediately following the WSTS's release of its latest sales numbers at the beginning of each month.
Consequently, the updated forecast number(s) derived by the Cowan LRA model will evolve each month as the latest global semi sales are redported by the WSTS.
Therefore, stay tuned for the next monthly sales forecast update from the model - expected on or about July 5th, 2011.
Mike Cowan, independent semi industry analyst and developer of the Cowan LRA forecasting model