TTI Executive Report: 2025 Industry Outlook

QUESTION:
2024 has been a relatively flat marketplace for electronic components globally, what do you predict market conditions will be in 2025?

Lew: I feel the best way to describe the 2024 electronic component market is inconsistent.  It has been inconsistent month-to-month, inconsistent by customer segment / application and product type and inconsistent by geographic region.  For the most part, the areas of growth such as defense and space, and the AI ecosystem have been offset by weakness in other areas such as industrial automation, consumer products and EV.

As a result, there is an overall feeling of uncertainty about 2025.  On a broad basis, we seem to be at the bottom of the down cycle. There are vastly differing opinions on what 2025 will look like in terms of market growth for electronic components.   

The consensus feedback we hear at this time is that the Americas will see modest component growth, including in the semiconductor area, with semis pulling along other board-level products like capacitors and discrete semis.  At the same time, it appears that the EMEA market may recover more slowly, with continued weakness in industrial, energy and passenger vehicle markets at least early in the year.  Asia and China have seen modest growth in 2024, driven by increased demand in the AI ecosystem and transportation coming out of China, and that growth is expected to continue in 2025.

At TTI, the best strategy for an inconsistent market is to be consistent. That means continued broadening and enhancing our inventory position and available-to-sell part numbers. That means investing in warehouse expansions and automation to increase productivity and overall performance levels while optimizing our cost to serve.  TTI will continue to spend more time with our customers and our suppliers, focusing on delivering increasing value to both.  Whatever the market does in 2025, we will be well positioned with a view on the long term.