Strategic Intelligence: Component Makers Sector Scorecard Q3 2024 Update

The component makers marketplace continues to face some significant challenges as global industry goes through a challenging phase. Rising geopolitical tensions, low growth, especially in China, and tight credit conditions (despite falling interest rates and fragile supply chains) make for a sputtering economic engine.

Key Highlights

• The major markets for component makers are flat. The manufacturing industry is showing annualized growth of less than 2%, while smartphone sales are projected to grow by 4% in 2025 versus an annualized rate of 5% in Q3 2024. One area of growth is defense. Countries that are spending more on defense are Israel, Iran, Ukraine, the US, China, and Russia, as well as NATO countries that are collectively under pressure to raise their defense spending to 2% of GDP. Global defense spending jumped 9% to a record $2.2 trillion in 2023, according to the International Institute for Strategic Studies. It remains to be seen how many component makers, like US connectors specialist Amphenol, truly see defense as a growing opportunity.
• Take-up in electric vehicles might be picking up. China continues to lead in battery-powered electric vehicle (BEV) sales, but Europe and Asia, notably India, are starting to see more growth. However, prices remain too high. In the US, the electric vehicle (EV) market remains markedly underdeveloped. US EVs in 2023 had a 10% share of total sales compared with 38% in China and 21% in the EU, and EV tax credits in the Inflation Reduction Act have had only a limited effect. Another key brake on take-up outside China and notably in the US remains the lack of well-distributed infrastructure, notably nationwide public-charging stations.

Scope

• This sector scorecard provides a top-down, comprehensive outlook for the key players in the component makers sector over the next two years, based on the key themes set to transform their industry landscape.

Reasons to Buy

• Companies that invest in the right themes become success stories. Those that miss the important themes in their industry end up as failures.
• The analyst’s thematic research ecosystem is a single, integrated global research platform that provides an easy-to-use framework for tracking all themes across all companies in all sectors. It has a proven track record of identifying the important themes early, enabling companies to make the right investments ahead of the competition, and secure that all-important competitive advantage.
• At the analyst, we have developed a unique thematic methodology for ranking all major companies in all major sectors based on their relative strength in the big themes that are impacting their industries.
• Our thematic engine tags over 180 million data items across six alternative data sets-patents, jobs, deals, filings, social media, and news-to themes. The vast datasets within our thematic engine help our analysts to produce sector scorecards that identify the companies best placed to succeed in a future filled with multiple disruptive threats.