Boston, MA -- (SBWIRE) -- 03/12/2014 -- BMI projects Mexican consumer electronics spending was US$13.8bn in 2013. Despite a mixed economic outlook, consumers are expected to continue to spend on flat-panel TV sets, tablet PCs and smartphones. President Enrique Pena Nieto's announcement in November 2013 of the country's National Digital Strategy should improve the level of digital inclusion in Mexico, helping spur growth in the consumer electronics sector.
While we remain optimistic toward Mexico's growth story over the medium term, private consumption weakened in H212 due to a weaker manufacturing sector and high inflation and we expect this trend will persist in 2014. The US economy is sluggish and credit growth is expected to tighten. However, we expect continued demand for flat-screen TV sets, tablets, notebooks and smartphones to be driven by product innovation, such as smart TV sets and growing affordability, particularly for smartphones.
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Headline Expenditure Projections
- Computer hardware sales: US$7.5bn in 2013 to US$8.1bn in 2014. Should be boosted by growing popularity of by tablets, and further migrations to Windows 8.
- AV Sales: US$2.2bn in 2013 to US$2.3bn in 2014. TV sets expected to provide the most dynamic development.
- Handset Sales: US$4.2bn in 2013 to US$4.5bn in 2014. 3G and 4G smartphones are likely to be the main revenue growth driver.
Key Trends And Developments
A significant growth opportunity exists in provincial areas and second-tier cities, where multinational vendors are trying to strengthen distribution. Mexico's under-penetrated south east region is expected to offer growth opportunities over BMI's five-year forecast period to 2018, particularly in the public sector. Digital TV sets will account for of the majority of TV sales by 2018 and TV revenue will account for a similarly high portion of total AV demand. Mexico has one of the region's highest TV household penetration rates, but continued growth should be driven by increased demand for multiple set ownership. Government plans to introduce more competition in the broadcasting sector and to license more digital TV services should drive TV set upgrades.
The 4G mobile phone sector is becoming increasingly competitive, with the launch of the BlackBerry Z10 in March 2013 and the BlackBerry Q10 in July 2013. Both models will offer stiff competition to Apple's iPhone 5 and to the Samsung Galaxy S3 and S4 (the latter having been launched in May 2013). Meanwhile, curved smartphones are also starting to make an impact, with the arrival in October 2013 of the LG G Flex and the Samsung Galaxy Round.
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