Analysts of Israel’s electronics sector consider 2009 the most difficult year since 2000. In 2009, the sector decreased by 21% to $656 million, compared to $830 million in 2008. Market difficulty started in the last quarter of 2008 and continued in 2009, influenced by the global economic slowdown. Active components were worst hit and decreased from $587 million in 2008 to $475 million in 2009. Following were passive components, which fell from $145 million in 2008 to $127 million in 2009.
Despite market slowdown Israel is still a major importer of electronic components. Total imports still totaled $608 million, with nearly 30% coming from the U.S. Although the U.S. remains one of Israel’s main components suppliers, Asian companies are proving tough competitors. Numerous multinational corporations have also taken advantage of Israel’s technical expertise by establishing R&D facilities and manufacturing plants in the country. These include Applied Materials, General Electric, HP, IBM, Intel, Microsoft, National Semiconductor and Vishay.
As a developed technology market, Israel is always looking for innovative technologies and components to enhance product technical features. Developments in the Israeli telecom, defense and homeland security markets have had a positive effect on the increased demand for electronic components. Israel’s purchasing nature is based on two main factors, price and technical support.
Israel offers opportunities for U.S. exporters of active components, RF & microwave, power amplifiers and semiconductors. There are a large number of Israeli companies that represent U.S. firms in this sector, always looking for new-to-market U.S. companies with good service and competitive prices that they can represent.