Electronics Buyers Optimistic, But Report Slowdown in April

May 5, 2015
Global Purchasing Index remains in positive territory, but buyers surveyed report weaker confidence, as the index falls 12% compared to March.

Buyers of electronic components remained optimistic in April, though their business confidence slowed compared to the first quarter of the year, according to the Global Purchasing Index report for April.

Buyers reported declines in new orders, purchasing activity, and inventory levels while also noting a drop in pricing and a shortening of lead times for many electronic components. The overall GPI dropped 12% compared to March, to a reading of 109—still above the 100-point mark indicating economic optimism, but below the rebound levels the index had experienced since January.

“We have seen a big slowdown this month,” said one panelist.

New Orders, Purchasing Activity Down

Buyers reported a 9% drop in new orders from customers in April, as the new orders index fell to a reading of 2.14. The new orders index had risen in February and March after falling slightly in January. Buyers reported a larger decline in their own purchasing activity during the month, as the new purchases index fell 13% to 2.07 compared to March. This reverses a three-month upward trend.  The new purchases index had risen steadily in the first quarter following a considerable drop in December.

Buyers also reported lower inventory levels during the month, as the inventories index dropped 7%. This follows a 11% jump in inventory levels in March. The inventories index has been unsteady since December when it fell 17% before rising 16% in January and then dropping 9% in February.

Pricing and Lead Times

The GPI pricing index fell slightly in April, registering less than a percentage point lower than March’s reading. Buyers had been reporting rising prices for electronic components in January and February before noting a 7% decline in the index in March.

Buyers polled for the April GPI also noted shorter lead times for many of the electronic components they buy. The lead times index fell 3% compared to March. The lead times index has also been up and down recently, rising 9% in January, falling 7% in February, and rising 6% in March.

Despite the lower overall confidence among electronic components buyers, some reported stable business conditions at the start of the quarter.

“Business is steady right now,” said one panel member.

Other areas of the GPI you may be interested in:About the GPI | GPI Panelists | Apply to the GPI | Member of the Month | Article Library
About the Author

Victoria Fraza Kickham | Distribution Editor

Victoria Kickham is the distribution editor for Electronic Design magazine, SourceESB and, where she covers issues related to the electronics supply chain. Victoria started out as a general assignment reporter for several Boston-area newspapers before joining Industrial Distribution magazine, where she spent 14 years covering industrial markets. She served as ID’s managing editor from 2000 to 2010. Victoria has a bachelor’s degree in English from the University of New Hampshire and a master’s degree in English from Northeastern University.

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