Via apggroupindia.com

Challenges the Electronics Industry will be Facing in 2016

If you still remember, yesterday TechDesign touched on the impact of mergers and acquisitions in the semiconductor sector and what trends of development can you expect in the digital payment and imaging electronics sector. While you have accumulated some understanding about what to expect from the electronics industry in 2016, TechDesign realizes that this topic can’t be left off without also reminding you about the potential challenges that it will face in the coming year. So that’s what we will focus on in the last post of this three-part series.

IoT as another bubble in the air? 

Via flickr.com
Via flickr.com

Since the emergence and rapid popularization of Internet of Things, it has become the prime target that every company is after. However, the sector still requires lots of work to establish a suitable business model that can incorporate all parts of IoT. Additionally, manufacturers need to ensure that their products or services can be sold at a reasonable price to consumers. According to Electronic Design, the sector still requires some more years to mature and throughout the process,  not all the IoT products can survive the test of consumer preference. For manufacturers of those products that are close to elimination, they have to quickly determine why are their products failing to appeal to customers and how they have to fine-tune them. So experts warn any IoT manufacturers to proceed with caution and perform careful examination of their IoT systems’ feasibility. That might save them a lot of troubles before rolling products out to mass production.

The potential effect of a Chinese breakdown 

Via china2west.com
Via china2west.com

If you have followed our previous series on IDHs and China, we talk extensively about China’s importance to the global electronics value chain, including its production power and mass consumer market. It has undoubtedly become the world’s production leader and the biggest consumer market for electronics in the past decade. However, Electronic Design warns about the potentially negative effect of a Chinese breakdown, as several factors prevent the outside world from acquiring complete and transparent understanding of its economic performance. According to them, a breakdown of China will severely detriment the global electronics market and supply chain. As a result, how does China develop over the next few years will be key to the overall performance of the electronics industry.

Demand driver in 2016 

Via optimus5.com
Via optimus5.com

So after all the predictions, you must be wondering what are the demand drivers for the electronics industry in 2016. Experts predict that the semiconductor sector will continue its rather flat performance from 2015, with the performance from world economy directly impacting the sector. However, the imaging and automotive sector will rise up to keep the electronics industry alive. One thing for sure is the whole industry should pay close attention to how the overcrowded IoT sector and China develop. So looks like all the eyes will be on the IoT sector and China while the imaging and automotive sectors play the role as anonymous heroes.

As always, TechDesign hope you have enjoyed another long series from us and find it informative. We will continue to have similar series in the coming months, so stay tuned. If you have any suggestion or opinion, please don’t hesitate to leave them at the comment section.

 

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