Of all the markets hit by the devastation of the 2007-09 global economic recession, it can easily be argued that European semi was the unfortunate leader in this group.  With the loss of two of it's major chip companies, and the exiting from the DRAM industry, Europe is facing a new decade and new questions for its high tech future.

EMS for Europe has been very important, and therein are found some significant opportunities.  EMS forecasts are not stellar though (as reported inManufacturing Market Insider (Vol. 19:11, November 2009) and citing forecasts from InForum market research).   Growth has started for EMS worldwide and looks to hold steady around the 5% range +/- from 2010 through 2013; it's just going to take three years to recuperate the losses from 2008-09. 

The lag in an EMS rebound needn't be seen as negative for Europe though; growth is growth, after all.  With EMS rebounding, albeit slowly, and Europe being heavily invested in EMS, particularly specialty or niche markets, there are noteworthy opportunities for European EMS to lead in new markets and sectors.  These opportunities and markets will be explored more closely in the upcoming MarketWatch Quarterly edition due out later this month! Subscribe here to get your copy before public release.

The EU reaffirmed it's commitment to green policies at all levels during theUNFCCC's COP15 conference in Copenhagen, Denmark in December (see herefor our commentary from COP15).  While that makes for nice political talk, it does have bearing on business markets, particularly semi.  One of the important ways in which Europe continues to be a world leader is in the consumer purchase power of highly efficient appliances and consumer electronics products. 

European governments are now providing reduced or no taxes on electric cars (meaning up to 180% reduction in high tax countries such as Denmark).  Couple this incentive with eager consumers for smaller, greener autos in light of the European auto sector having a better footing than, for example, the American auto sector, you realize quickly that there is ample opportunity for European auto to lead the global electric vehicle market.  Electric vehicles are an important market for semi, moving the percent of chips per vehicle significantly higher than traditional autos.

Will European semi rebound?  That's an interesting and very important question for many companies and for both the semiconductor and electronics industries.  There is vacillating investment in Russia, there are politico-economic reasons (see above) to believe new markets hold opportunities, and there is existing consumer support for products.  Although the pace will be staid, don't they say, "slow and steady wins the race"?