$125.7 bln of consumer electronics will be sold in 2005

Manufacturer-to-dealer sales of consumer electronics goods will reach a record-high of $125.7 bln in 2005, marking an 11% increase over the $113.5 bln dollars sold in 2004, according to the Consumer Electronics Association (CEA). The year-end total for 2004 would exceed initial expectations. The $113.5 bln total is an increase of 11% compared to 2003 annual sales.

In the video category, digital television (DTV) continued to be a front-runner in 2004, as total sales of DTV products reached $10.7 bln on 7.3 mln units, which is an increase of 78% in dollar sales and 63% in unit sales over 2003 figures. One of the biggest drivers of digital television is flat-panel, ultra-thin displays (LCD and plasma). Total sales of LCD TVs (analog and digital) topped $2 bln in 2004 and will surpass $3 bln in 2005. Plasma TVs will experience similar growth as unit sales reached 853,000 in 2004 and then grow to over 1.4 mln units in 2005.

The growth of the portable MP3 player and aftermarket autosound helped boost audio sales in 2004. The portable MP3 player category has shattered all expectations as unit sales more than doubled in 2004 to over 6.9 mln units and dollar sales nearly tripled in revenue to $1.2 bln, compared to figures from 2003. The category will continue to grow in 2005 as CEA forecasts that unit sales will reach 10 mln units and $1.7 bln in dollar sales.

CEA Director of Industry Analysis Sean Wargo also pointed to satellite radio as a key driver in 2004 and going forward. “Satellite radio and video navigation are two areas that are helping to drive the aftermarket category. Current 2004 figures show that satellite radio is helping boost autosound revenues up 10% for the year. Mobile navigation devices also are helping the aftermarket category as dollar sales topped $782 mln in 2004, an increase of 35% compared to dollar sales in 2003. Dollar sales for navigation devices will continue to grow in 2005 as CEA estimates that total sales will hit $935 mln.”

CEA also noted that flash media has become one of the biggest growth categories as digital content continues to grow with more usage of digital cameras and MP3 players. Flash media cards ended 2003 with more than $1 bln in shipment volumes and CEA estimates sales of the cards will end 2004 at over 200% growth with more than $3 bln in product shipped. CEA forecasts increased demand for storage to push the market to nearly $6 bln during the next year.

Sales of personal computers (PCs) remained strong in 2004 as more consumers turned to portable PC products such as laptops, notebooks, and tablet computers. Current year shipments of the portable PC products are pushing the category into a new round of growth, with total revenues up 10% to a height of $17.2 bln. This trend is expected to carry the market into the new year as total PC shipment revenues surpass $18 bln in 2005, bringing printers and other PC related peripherals and accessories along with them.

Wargo identified wireless telephones as another strong category for the CE industry as more and more innovations are introduced into the market. Phones with built-in digital cameras have helped add to the projected growth of 15% in revenues in 2004. Unit sales topped 79.6 mln units and will grow to 89.2 mln units in 2005. CEA also forecasts that the wireless industry will reach a new high of $11.3 bln in the next year.