What’s Ahead for Electronics in 2024

2023-12-29

As we near the end of the year, it’s only natural to wonder what 2024 will bring to the electronics industry in terms of opportunities and challenges. No one has a crystal ball, but I’ve got some educated guesses about what’s going to happen when I look down the road.

2024 has the hope of being a good recovery year for the semiconductor industry. We are starting to see lead times stabilizing and we’ll continue, as an industry, to work through the inventory overhang that has slowed sales down. We can look forward to more stable pricing and more manageable lead times for most components as we get into next year.  Of course, there will always be pockets of chaos, but it will be the exception rather than the rule.

Semiconductor sales are likely to strengthen by mid 2024—especially as sales are driven by emerging technologies like artificial intelligence (AI). Implementing these big ideas is going to take a lot of computing power. To build the networking infrastructure and raw computing power needed, OEMs are going to need a lot of chips.

Meanwhile, even as automotive sales slow a bit, electric vehicles continue to integrate more and more chips which should translate into increased component sales. Later in the year, industrial demand should also start to recover.  Sales of consumer chip sales will continue to lag—but these other opportunities will keep the industry strong.

It would be unrealistic to think that 2024 will be smooth sailing in every respect. We’re going to have to pay close attention to component manufacturing capacity. The intense focus on a shift to supporting the most advanced technologies with new fabs, as well as the trend toward consolidation in the semiconductor industry will lead to more product discontinuance notices (PDNs) or end-of-life (EOL) notifications. That’s going to create headaches for industries who have products with long lives, including the industrial, medical and aerospace and defense sectors. These verticals will need to focus on design for manufacturability and good relationships with the distribution chain to build resiliency into their supply chain and have an ability to weather the unexpected.

Continued geopolitical shifts will also have an impact on the electronics industry.  Every war that breaks out creates a certain amount of supply chain concern. It’s a big wildcard but not insurmountable.  All in all, 2024 should be a good year.

Let’s work more hard to embrace the upcoming good year!  Hongda Capacitors will continue to provide the new datecode high-quality passive electronic components to buyers from all over the world. Help your projects and products be launched on schedule and get good returns. We will deliver goods accurately for you at the price you need and according to your project progress, ensuring that your products go online on time while improving your inventory turnover rate. As long as you choose us once, you will understand why other customers choose us again and again.