Passive component makers expect to see large sales declines in the fourth quarter because of sharply decreasing demand.
Inductor maker Cyntec pointed out that orders from notebook customers have seen the most obvious decline from the beginning of November, and its fourth-quarter shipments of power chokes for notebooks have dropped over 10% from the third quarter. In general, Cyntec's sales growth in November and December will decline by a double-digit amount, while fourth-quarter sales will drop 5%, and margins will decrease from 32% to 29%, the company estimated.
Since raw material prices fell for the past two months, Cyntec is negotiating with suppliers to cut prices for materials such as iron powder and copper wire, the company pointed out.
Meanwhile, Cyntec said it expects to complete expansion at its Wujiang, China plant in the first quarter of 2009, although a decision on when to start operations may not be made until March.
Chip resistor maker Ralec Electronic also guided fourth-quarter sales are to see a double-digit decline, and utilization rate in November is expected to drop to 65% from 70% in October. Ralec estimated chip resistor ASPs are to fall by 5% in the fourth quarter, and said it is clearing inventory due to decreasing demand.
On the other hand, Taiwan-based companies expect to be able to win more customers due to lower-priced products and so hope to increase their market share compared to rivals from Japan and Korea.
Article translated by Meiling Chen
