Hi Peter - I thought I would "chime in" with last month's run of the Cowan LRA forecast model re. both 3Q and 4Q sequential sales growth forecasts relative to the results reported by Bill Jewell and yourself. Based on June's sales numbers as cited by the WSTS's HBR, the model's 3Q and 4Q sequential sales growth expectations came in at plus 5.3 percent and minus 2.1 percent, respectively. The model's corresponding quarterly sales forecast estimates are $78.64 billion and $76.95 billion, respectively. resulting in a full year sales forecast for 2013 of $300.69 billion. Consequently, the model's sequential sales growth numbers are less bullish than both Bill's "needed" results of 6 percent per quarter and your numbers as gleamed by averaging ten years of historical WSTS quarterly actual sales numbers. By the way the next run of the model will be next week immediately following the WSTS posting of the July HBR. Therefore, stay tuned for the updated expectations which will be geared off July's actual sales.
Peter, your 10 year average growth rates for 3Q and 4Q include the disastrous 24.2% decline in the fourth quarter of 2008 at the beginning of the great recession. If you exclude 4Q 2008, the average growth rates are 8.5% and 0.9%. Using these growth rates for 2013 would result in 5.6% growth for the year.
As to the Euro area recovery contribution to growth, it is the increase in demand for electronic goods which is the key factor. It is not electronics manufacturing - where most of the growth will continue to be in Asia. The Euro area accounts for 17% of global GDP compared to 22% for the U.S. and 12% for China. Thus the Euro area recovery will contribute to overall demand for electronics.
I agree that health growth is a relative term and highly dependent on the sector and overall economy growth. 10% is really good growth given today's situation. Hopefully the recovery in Europe will brighten things up.
While a recovery in the general European economy is slowly gathering pace I am not sure it will make as much difference to the semiconductor market as you might expect.
A lot of electronics equipment manufacturing has already left Europe. Almost no computers or cellphones are made here and industrial and automotive subsystem builds face competition from the eastern hemisphere.
I would look to India, China, Vietnam, South America to make the difference.