Electronics Production Growth Sets Sights on a Multi-Year Record
Production increases are driven by strong growth in exports.
Electronics production, which started expanding in late 2016 and has accelerated since then, may be reaching its apex, according to data from Gardner Business Intelligence’s (GBI) proprietary business index database. Growth in electronics production during the second and third quarters of 2017 was driven by increases in new orders, particularly by strong growth in exports. The six-month moving average of electronics production through August is reminiscent of growth last experienced in the second and third quarters of 2014.
Data on production, new orders, exports, and backlogs suggest that the electronics industry is likely to enjoy strong growth for the rest of the year.
Examining production data by company size uncovers additional insights. Larger firms (those with more than 100 employees) are reporting much higher rates of growth than smaller firms (with fewer than 50 employees). The six-month moving average of the production index among large firms at the end of August surged to over 78.6, while the comparable production index among small firms was 52.1, down from levels of over 60 in the prior two months. (Values over 50 indicate expansion, while values below 50 indicate contraction.)
A similar dispersion in backlog trends has also appeared between large and small firms. Between May and August, the three-month moving-average backlog index for large firms increased rapidly, while comparable index values for small firms indicated only modest backlog expansion. GBI monitors backlog data carefully because of its importance as an indicator of future production (see graph).
For the market as a whole, the rising indexes for production, new orders, exports, and backlogs suggest that the electronics industry is likely to enjoy strong growth for the rest of the year. GBI will continue to monitor carefully the industry’s smaller firms, as data from these companies tends to behave as a leading indicator of the direction of the overall electronics market.
Using financial data from publicly traded firms, GBI examined the capital expenditures of nearly 70 major electronics manufacturers between 2009 and the second- quarter of 2017. Examining the data on a rolling 12-month basis and indexing it to 2012, capital expenditure by electronics manufacturers is up 18% since 2012.
ABOUT THE AUTHOR: Michael Guckes is the chief economist for Gardner Business Intelligence, a division of Gardner Business Media (Cincinnati, OH US). He has performed economic analysis, modeling and forecasting work for nearly 20 years among a wide range of industries. Michael received his BA in political science and economics from Kenyon College and his MBA from Ohio State University. Contact (513) 527-8800; firstname.lastname@example.org; gardnerweb.com.
Medical tubes are becoming ever smaller and thinner while adding new features like high-tech material combinations, more wire braiding/wrapping, and heat-shrink sheathing for strength and kink resistance.
Many conditions must be met to get the best wall distribution in a PET bottle. Skilled operators are, as always, indispensable.
A new study shows how the type and amount of LDPE in blends with LLDPE affect the processing and strength/toughness properties of blown film. Data are shown for both LDPE-rich and LLDPE-rich blends.