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Electronics market sees worldwide boom – but will it stay?

The global electronics market has seen a good start in 2010, but Hungary lags behind the worldwide trends.

At a global level, the electronics market – including home entertainment, IT, photo and telecommunications – showed a significant increase in the first three months of the year, according to a recent study by Gfk Hungária.

Of the top ten product groups, that add up some 85% of the entire market, eight generated massive growth globally in Q1 from the same period of last year. However, out of these eight, only three – mobile phones, smart phones and portable PCs managed to increase in Hungary over the same period, the study says.

As for the Asia and Pacific region, the market increased 13% in Q1 from the previous year, following a 1% decline from 2008 to 2009. Latin-American markets showed a more prominent improvement: while there was a 19% decline in 2009 from the previous year, the growth was 38% in January-March this year from the same period of 2009.

While African and Middle-Eastern markets also performed well, with a 15% increase, Western Europe saw only some 4%, and Eastern European markets produced 12% decline.

While demand for the top ten categories has grown worldwide, they were less sought-after in Hungary during the first three months of the year: compared to the same period of 2009, the market saw a 2.6% decline, with only three segments showing notable growth.

But April gave more reason for optimism, as it turns out from the Gfk study. In April, five of the top categories saw increases: in addition to the mobile, smart phones and portable PCs, game consoles and LCD televisions were selling better. The Gfk attributed the latter to the Football World Cup: “LCDs will probably sell better at a yearly level as well due to the championship,” Andrea Sztupár, country manager at Gfk Hungária forecasted.

Whether the market will continue to see positive tendencies greatly depends on the performance of the Western European and North American markets, the study claims. The current boom was unquestionably caused by the increased demand on the emerging markets.

But what will happen once these markets become saturated and households will not need any more gadgets? The Gfk study says that in order to maintain positive market trends, manufacturers should focus not only on new technologies but also on new ways of utilization. (