MUNICH, Germany The German industry association ZVEI expects the local semiconductor market to grow in 2008 at a rate of 4 percent - if valued in euros. In dollar terms however, the growth rate is highly unclear.
The divergence in dollar and euro valuation has been increasingly a factor of insecurity in the European chip economy. For instance, the German semiconductor market in 2007 grew 4.4 percent dollar terms. Valuated in euro, it declined 4.1 percent during the same period, explained Ulrich Schaefer, chairman of the ZVEI semiconductor component working group.
For the year ahead, the ZVEI market watchers expect the German market to return to growth and add 4 percent (in euros) to a volume of somewhat more than 11 billion (about $17 billion). The growth will be distributed evenly over the ZVEI's product categories integrated circuits, opto semiconductors, discretes and sensors/actors.
In 2007, the growth in the industrial semiconductor market segment slowed down to 4 percent after having grown 12 percent in the year before. The ZVEI saw a disproportional high growth rate in the demand for smartcard chips.
Also the automotive customers shifted down. In 2007, the segment added only 1 percent after a growth of 10 percent in the year before. In the German market, automotive customers are responsible for 35 percent of the semiconductor sales. This is certainly one of the highest market shares in a global scale. Another market with extraordinary high demand for automotive semiconductors is Japan. The significance of this application segment is reflected at the production side: Germany and Japan combined produce about 50 percent of the world's automotive chips, the ZVEI said.
Information and data technology performed stable in terms of sales during the past year. In 2006, this segment had shrunk 15 percent. With a market share of 32 percent, this applications rank second in the German market.
For the world market, ZVEI experts predict a growth of 7 percent in 2008. Opto semiconductors as the strongest segment will add 11 percent. Sales of sensors and actors is expected to grow 9 percent while discrete will add only 6 percent. ICs will perform in line with the entire market and add 7 percent.