Malaysia Consumer Electronics Report Q2 2015
BMI View: Although consumer electronics market in Malaysia has expanded rapidly in value and volume terms in recent years, BMI sees slower growth in 2015, which will lower the rest of the forecast. Saturation of tablet market and slower pace of the audio visuals market following the FIFA world cup which will see demand for TV's decreasing will result in slower overall growth in 2015. However, further on growth will return as declining device prices combine with strong economic performance and rising incomes to drive demand growth. Broadly speaking, we expect this dynamic we expect to remain in place in the medium term. Increasing competition in the smartphone, tablet and flat-screen TV markets from Chinese vendors will ensure the market continues to deepen, but as the market becomes saturated intense price competition is expected to result in a squeeze on value growth and vendor margins. There is also downside risk due to uncertainties over the export market, particularly the potential for a hard landing in China.
Headline Expenditure Projections
Computer Hardware Sales: USD2.7bn in 2014 to USD2.5bn in 2015, decline of 4.9% as the tablet market is losing momentum as a result of core market saturation, AV Sales: USD1.2bn in 2014 to USD1.2bn in 2015, an increase of 3.2%. The AV segment is again forecast to underperform, but after a precipitous decline in digital camera volumes in 2013 and 2014, we expect the market to stabilise form 2015.
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