Electronics Component Market 2023: A Year of Improvements
The 2023 State of the Electronic Components Market Round Up marks a significant milestone as Lytica, the world’s premier provider of electronic component spend analytics and risk intelligence, presents its first annual review.
Leveraging our unique position in the industry, Lytica has worked with over 100 customers, analyzing more than $425 billion in electronics spend. This comprehensive analysis, conducted using a basket of 15,800 electronic components across 22 categories, consists of the most popular devices used by our customers. These indices are intended to show trends in the market. Individual component and BoM analysis is offered by Lytica as a service to our customers.
In this roundup, we delve into the compelling narratives of 2023, unveiling improvements in electronic component pricing, lead times, and availability. As we embark on this journey, we invite you to explore the intricate dynamics that shaped the electronic components market throughout the year, providing valuable insights for industry professionals.
Electronic Component Pricing Was Compelling for Buyers in 2023
Beginning of 2023: Average price for tracked components was up 3.70% year to date from January 1st – 31st
End of 2023: Average price for tracked components decreased by 8.99% year to date.
The pricing journey through the electronic components market in 2023 reveals a compelling story of decreasing prices for buyers.
From January 1st to 31st, electronic component prices rose by 3.70%. Throughout the year, the average prices increased only three more times— up 0.1% in March, 2.09% in June and a meager 0.20% in October. However, the overall trend for 2023 was a decreasing of average prices. May saw the first relief with the average tracked price down 0.50% year to date. From July onward, prices continued to decline. The most notable dip occurred between August and September, with average pricing now down by 5.78% year-to-date. By November and December, the average price for tracked commodities had decreased by an impressive 8.99% to end the year. This decrease really benefits buyers, offering improved pricing opportunities for purchasing teams worldwide.
Of the 24 tracked commodities for 2023, 16 of them ended the year with a lower year to date average price. That means, by the end of the year, 16 commodities had decreased in price from January 1st, 2023. The biggest drivers decreasing average price for electronic components in 2023 were:
- Power Discrete decreased 19.0% year to date
- Processor decreased 15.7% year to date
- Resistor decreased 15.1% year to date
- Standard logic decreased 12.4% year to date
- Diode decreased 11.9% year to date
- Programmable Logic decreased 10.2% year to date
There were only 8 commodities pushing upward against this trend, with the most significant ones being:
- RF/MW increased 11.5% year to date
- Communication increased 2.3% year to date
- Circuit Protection increased by 1.6% year to date
Electronic Component Lead Times See Massive Improvements in 2023
26.38%: The average decrease in lead time for tracked components year to date in 2023.
Just like pricing, the story surrounding lead times was one of consistently improving conditions for the electronic component buyer.
Throughout 2023, lead times demonstrated consistent improvement in every month except for October. The initial months of January and February showed a gradual decrease of 0.10% in average lead times. As spring unfolded, the pace accelerated with substantial reductions of 3.90%, 6.68%, and 10.42% in March, April, and May, respectively. The momentum continued into the summer, witnessing a noteworthy 22.37% average lead time reduction by the end of September. Although October saw a marginal 0.8% increase in lead times, it remained an anomaly in an otherwise positive trend. Concluding the year on a high note, the overall average lead time impressively decreased by 26.38% year-to-date.
Decreasing lead times can be seen across all but 3 tracked electronic commodities. The main commodities driving the year to date decrease in lead times include:
- Communication decreased by 91% year to date
- Memory decreased by 67.7% year to date
- Magnetic decreased by 63.9% year to date
- Transistor decreased by 60.8% year to date
The 3 commodities pushing back on the overall average lead time can be attributed to:
- Power Supply increased by 69.6% year to date
- Processor increased by 11.7% year to date
- Relay & I/O Module increased by 8.0% year to date
Electronic Component Availability a Great Sign for Buyers in 2024
82%: The average availability for all tracked electronic components in 2023.
Procurement professionals enjoyed another success story in 2023 as electronic component availability remained consistently high. Only three months throughout the year witnessed a drop in availability compared to the previous month.
Starting the year at 70%, electronic component availability saw a consistent upward trend for almost every month. Exceptions occurred only in March, September and October where availability decreased to 74%, 81% and 80% respectively. The most significant jump in availability took place in November, soaring by 8 percentage points to reach 88%, up from 80% in October. The year concluded with a final capstone in December, boasting an impressive 89% availability for tracked electronic components.
Of the 25 tracked commodities, 15 were at least 80% available on average in 2023. The ones with the highest availability included:
- Optomechanical was 100% available
- Semiconductor was 97% available
- Magnetic and Power Discrete were 93% available
- Capacitor and Circuit Protection were 91% available
The commodities pushing against this trend with the least availability included:
- Programmable logic was 31% available
- Processor was 59% available
- Communication was 62% available
Sign up for our newsletter for more on the electronic components market. Stay tuned for our next State of the Electronic Component Market where we look at January 2024.
