Georg Steinberger, president of DMASS, commented: “A slowdown in customer bookings throughout the year has now materialized into a surprising decline in revenue. It is a combination of factors driving the slowdown, both external and internal, and most of them will be with us for some time. There is more caution and skepticism in the market than necessary, as we believe the opportunities for technology remain significant. We expect the market to recover during 2020.”
 
At the country and regional level, the situation is quite uneven. While Germany, France, and Italy all saw double-digit declines in the third quarter, the UK actually grew by 1.6%, and Eastern Europe held steady with 0.5% growth. Among the major markets, Germany fell by 12.9% to €618 million, Italy by 13.1% to €168 million, France contracted by 15% to €132 million, and the UK grew by 1.6% to €159 million. The Nordic countries (including the Baltic states) saw a decline of only 3.7% to €183 million, while Eastern Europe grew by 0.5% to €380 million.
 
Georg Steinberger commented: “There were no major changes compared to previous quarters. Countries with a high proportion of contract manufacturing continue to grow or at least maintain their momentum, while OEM-driven markets are experiencing a further slowdown or losing more business, particularly in Eastern Europe, which has a strong contract manufacturing base. The most surprising aspect of this quarter is the UK's resilience in the face of the ongoing Brexit frenzy.”
 
Regarding product types, the decline spans all technologies and products. However, while discrete, standard logic, and Micro MOS Micro products saw double-digit declines in the last quarter, power, optoelectronics, memories, and other logic products held steady, with declines ranging from 0.6% to 7.5%. Analog products fell 8.65% to €618 million, Micro MOS dropped 11.7% to €413 million, power discrete products declined 2.6% to €241 million, optoelectronic products fell 7.5% to €194 million, and memories fell 6.9% to €195 million. Other logic products remained strong, declining by a mere 0.6% to €123 million.
 
Georg Steinberger: “The quarterly view doesn’t really provide much insight since the situation is different in almost every country. However, during the first nine months, we see that some areas are proportionally too weak, such as discrete components, optoelectronics, Micro MOS, standard logic, and programmable logic, while analog, memory, and power components are holding up well. What’s difficult to estimate is the impact of suppliers taking business away from direct distribution. We know that areas like analog, programmable logic, and Micro MOS are affected by this and will be even more so in the future.”
 
With 2019 almost over and likely ending slightly negatively, the question is what 2020 will bring. Steinberger: “We believe we will see more disruptive innovation in the coming years and more distribution opportunities.”
 
DMASS Ltd. reports statistics to members only on interconnects, passive components, electromechanical components, and power supplies (IPE).