The Malaysian American Electronics Industry is expected to see a marginal growth in sales this year due to slowdown in the global economy and uncertain market.
The Malaysian American Electronics Industry (MAEI) is likely to see a marginal growth of 0.4% in sales this year as the global economic growth has slowed down, particularly in the US, as reported by redorbit.
MAIE also revealed that the revenues of the Malaysian electronics are expected to go up only $22.65 Billion this year. The capital investment by electronic manufacturers from the US is projected to decline by 10.6% to $746 Million. Export sales of MAEI companies grew by 7.1% last year to $22.58 Billion, with 27.7% share in the total electrical and electronics sales. Besides, the capital investment to upgrade new products and development of facilities is anticipated to decline by 10.7% from $835 Million in 2007 to $746 Million in 2008.
The main factor for marginal rise in the sales of Malaysian electronic industry is the slowdown in the global economy. Other factors such as price pressure, revision of growth rate by the Semiconductor Industry Association and uncertain market conditions are also causing declination in the semiconductor industry (as semiconductors are main components of electronic items).
Apart from this, soaring food and fuel prices are restraining people to purchase electronic products like cell phone, PCs and MP3 players because they are forced to spend a significant amount of their income on energy and food, essential necessities of day to day life.
According to the industrial experts, slowdown in the global economy still continues and its effect will be reflected in the sales of semiconductor products. Despite this, the investment in the Malaysian semiconductor industry is still being made, indicating towards the investors’ confidence in the industry. With rise in seasonal sales, the second half of 2008 might bring in good news for the investors.
According to a Research Analyst at RNCOS, “The Malaysian semiconductor industry is expected to see a marginal growth this year due to fall in sales of major electronic products like PCs and mobiles (phone). These products are the major source of revenue for the industry. However, the growth rate could be increased if the electronic companies launch new products with more features and functionality at affordable prices.”
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