Bishop & Associates’ 2014 Connector Industry Forecast shows major changes in the marketplace, including stronger performance in the industrial, automotive, and telecom/datacom equipment sectors.
The connector industry’s performance for the first five months of the year has been very strong. Year-to-date May, the industry has grown revenues by +9.5% over the same period in 2013. Although the year-over-year comparison will get more difficult in the last half of the year, we feel that the industry growth will exceed our previous forecast of 6.7% for 2014 and that the regional performance has also shifted in some cases.
The new Bishop forecast projects the connector industry growth to be +8.3% in 2014 to a worldwide value of $52,930 million. The growth by region can be seen in the following table.
Major changes include stronger performance in Europe and China, and weaker performance in ROW. The Chinese market for connectors is expected to grow +11.5% in 2014 followed by Europe, which is still nursing a weak recovery from recession but is expected to grow +9.5% over 2013.
The table below shows the growth by market sector.
Major changes include stronger performance in industrial, automotive, and telecom/datacom equipment sectors. Automotive will have the strongest growth at +11.2% over 2013. Industrial and telecom/datacom will both produce +9.5% growth in 2014.
There are several factors driving the growth in electronics and in the connector industry:
- Interest rates worldwide have stayed at historically low rates.
- The economies of Europe are recovering on a tepid, but steady, pace.
- The United States economy continues to grow, unemployment is down, and the stock market is setting new records.
- Housing prices and sales continue to grow in the US.
- Automotive sales are growing as drivers need new, replacement vehicles and feel more confident about the financial commitment. The automotive industry is also a major driving force in the worldwide economies.
- Higher levels of industry growth are also the result of easier comparison to 2013’s modest growth of +2.7%.
Dave Pheteplace, VP, Bishop & Associates, Inc.
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