Growth in end-user sectors boosts SMT demand

March 30, 2006
MARCH 30--The development of high-growth end-user industries is opening up lucrative opportunities in the European surface-mount-technology (SMT) placement equipment market.

MARCH 30--The development of high-growth end-user industries is opening up lucrative opportunities in the European surface-mount-technology (SMT) placement equipment market. Industries such as telecommunications, automotive, and medical electronics are developing at an accelerating rate, thereby hiking demand for SMT placement equipment. New analysis from Frost & Sullivan (London, UK;, European Surface Mount Technology (SMT) Placement Equipment Market, reveals that revenues in this industry totaled $368.5 million in 2005 and is estimated to reach $550.5 million in 2012.

"Fast-moving commercial markets, which demand a succession of sophisticated high-technology products, are dominating the electronics-manufacturing scene today," says Frost & Sullivan research analyst P. Santosh Kumar. "This trend is compelling manufacturers to keep pace with the continuous miniaturization and convergence of different technologies by developing increasingly flexible, modular SMT placement equipment."

For instance, mobile phones, once considered a luxury, are now becoming a commodity and converging with consumer electronics devices. Mass production of these multifunction products requires highly sophisticated, flexible and high-speed manufacturing equipment. In addition, the use of wireless technology in medical devices is growing rapidly, resulting in heightened demand for specialized SMT placement equipment. Also, the increased complexity of printed-circuit boards due to the miniaturization trend across multiple industries is further boosting demand levels.

With a large number of central and eastern European countries recently joining the European Union, the SMT placement equipment market is experiencing significant new growth opportunities. Countries such as Romania, Estonia, the Czech Republic, and Hungary are emerging as attractive low-cost manufacturing locations for the top global electronics manufacturing service (EMS) providers, all of whom have set up production facilities in the region. This trend is expanding the demand for new SMT production equipment.

Despite such promising prospects, the cyclical nature of SMT equipment sales, as well as the high cost associated with operation and maintenance, can inhibit new equipment purchases. Many SMT placement equipment manufacturers have experienced financial losses and inventory build-ups with their product ranges in the past, not only due to the economic downturn, but also due to changing market requirements and the high price of new equipment.

"Since the economic downturn of 2001, price has become a major concern for original equipment manufacturers and EMS providers," notes Kumar. "As a result, alternative business strategies focused on maintaining position rather than on increasing market share are being developed by manufacturers."

In addition to developing innovative new business strategies and significant corporate restructuring, manufacturers need to add extra value to their products. The design of compelling customized, high-quality, value-added services together with advanced technical features will limit further price declines and help manufacturers differentiate their products in this highly competitive marketplace.

If you are interested in a virtual brochure, which provides manufacturers, end users and other industry participants an overview of the latest analysis of the European Surface Mount Technology (SMT) Placement Equipment Market, send an email to Magdalena Oberland, corporate communications, at [email protected] with your full name, company name, title, telephone number, fax numbe,r and e-mail. Upon receipt of the above information, an overview will be sent to you by e-mail.

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