ResearchNewsletter - Archive Server

"Positioning Internationally"
Robert Freischlag, President
Fujitsu Mikroelektronik
The European semiconductor market is expected to grow from $8.5 billion in 1988 to
$12 billion by 1992. European companies that rely on state support and protectionist
legislation will lose out, while the most efficient companies will survive. Cars and
semiconductors, however, will receive national protection from their governments.
Non-European companies that merely export to Europe will be in trouble. Those who
want to win will need a European headquarters sales office, assembly, packaging and test
facilities and diffusion plants. To support the future market they will also need
increased R&D. Companies will need to pursue global strategies, while retaining their
sensitivities to local needs.
"Integrating into Europe"
Bany Waite, Vice President and General Manager Europe
Motorola Semiconductor
Europe has 360 million consumers, of whom 320 million are in the European
Economic Communities (EEC) compared with 250 million in the United States. Europe's
GNP is $4.7 billion—10 percent more than the U.S.'s GNP. Europe's semiconductor
requirements are supplied 43 percent by U.S. producers, 38 percent by European
producers and 19 percent by Japanese producers. New markets for semiconductors will
account for 40 percent of the 1994 semiconductor TAM. These markets will be in car
safety, emission controls, intelligent credit cards, ISDN, HDTV, CD-I, pan-European
digital cellular phones, and satellite TV. As Europe grows in self-sufficiency, it will
increasingly manage free trade to the point where capital and information will be the
only freely traded worldwide commodities.
"Global Distribution in the 1990s"
Stephen Segal, Executive Vice President
Future Electronics Inc.
The world is becoming a global marketplace characterized by huge TAMs (e.g., a
1993 distributor TAM of $5.7 billion); world trade liberalization (e.g., the push to open up
the Japanese market); consolidations, acquisitions, and mergers (e.g., Harris/GE/RCA);
technology alliances (e.g., Motorola/Toshiba, Texas/Hitachi, and new fabs (e.g.,
Amphenol and Fujitsu in Scotland). The strategy for non-European distributors in Europe
is fourfold, as follows:
• Have deep pockets to prepare for a nonprofit period of up to two years
•
Enter Europe through start-ups or takeovers
Be structurally efficient—ship-from-stock and credit, single price globally,
MIS systems, regional warehousing
Form quality partnerships with a few global customers on a global supply basis
© 1989 Dataquest Incorporated July ESAM Newsletter