Technology Japan Tech Hardware: Diverging outlooks
Japan's slowing macro economy is negative for all industries, but degree & timing varies. Largest & earliest impact is on capex-driven hardware, automotive, servers & other IT hardware; least negative impact is on IT services.
Impact degree and time lag to be affected by COVID-19
Source: UBS
Intensity and timing of impact will differ by industry
We analysed past data by industry. The areas that see the earliest and largest impact from macroeconomic slowdowns are capex-driven hardware, automotive, IT hardware (servers), and consumer audiovisual equipment. Those where the negative impact comes somewhat later are the housing-related white goods, lift, and air conditioner industries and the IT services market. Cabling and electric rolling stock, both of which are tied substantially to public works investment, are also unlikely to avoid a negative impact this time. However, we also focus on potential upside from government support measures
