ELECTRONICS MAKERS FIND SALES BOOM IN OVERSEAS MARKETS

ELECTRONICS MAKERS FIND SALES BOOM IN OVERSEAS MARKETS

U.S. makers of electronic components and semiconductors are getting more and more of their business from overseas, but barriers in some of the largest markets still keep them from reaping the full benefits.

''For the first time in our history, we sold more overseas than in the domestic market," said Howard High, strategic communications manager for Intel Corp., a maker of electronic memory chips. He said 52 percent of Intel's

revenues last year came from international sales. "Clearly the trend is there.""The domestic market over the years has been larger, but now it's fifty- fifty," said Chuck Thompson, director of world marketing for Motorola Inc.

"The international market is exploding if you are a company smart enough to take advantage of it," said Brian McConnell, director of international sales for Ampro Computers Inc., a maker of specialty computer chips. About 66 percent of Ampro's current orders are from international customers, Mr. McConnell said. A year ago, international orders accounted for about 20 percent of the company's orders, he added.

"What we've seen is other parts of the world - particularly the Asia/ Pacific region - increase, while Japanese and European markets are falling back," said Tom Beerman, spokesman for the Semiconductor Institute of America.

Many American manufacturers that use U.S. electronic or semiconductor components have located assembly operations overseas, electronics executives explained. That has given overseas orders, particularly from Pacific Rim countries, a tremendous boost. That region has also drawn assembly operations

from other countries as well, which also use American electronic and semiconductor supplies.

Japan and Europe have traditionally been major markets for U.S. electronic components. Depressed economic conditions worldwide, however, have

cut back on demand, electronics trade experts said. It has also decreased the amount of electronic end-goods that are, in turn, imported into this country.

"Japan has been feeling the pinch of our recession," explained Marc Elliot, senior industry analyst for Dataquest Inc., a market analysis firm. ''There's been a tightening in the marketplace, not from competition, but

from the fact that people are not buying. That's not likely to change a lot in 1992."

Trade barriers are also contributing to the difficulty American electronic component makers are having in penetrating Japanese and European markets. The European Community, for example, has a 14 percent tariff on the import of U.S. semiconductors.

"We estimate that costs U.S. manufacturers about $350 million a year," said Mr. Beerman of the semiconductor group.

"In Europe, semiconductor makers probably are feeling a little stiffer competition," Mr. Elliot said. "Part of it is an increase in Japanese products, but part of it is also that Europe is being a little more restrictive."

Europe is the third-largest market for semiconductors. U.S. producers control about 45 percent of the market there, according to figures from the Semiconductor Institute of America. In the U.S. itself, the world's second- largest market, U.S. producers supply nearly 70 percent of the semiconductor market.

The figures are drastically different for Japan, the world's largest market for semiconductors. There U.S. producers supply only 12.5 percent of the market. The total foreign share of the market is about 14.3 percent.

"Even though Japan is the bigger market, we get twice as much revenue

from Europe," said Mr. High of Intel. "That's because Japan is essentially a

closed market."

"Almost 40 percent of the worldwide consumption of semiconductors is in Japan, so it's absolutely essential that U.S. makers have access to that market," Mr. Beerman said.

In a recent trade pact, Japan agreed give foreign producers at least 20 percent of its semiconductor market by the end of 1992. So far, American producers haven't seen much change.

"Japan's a huge market, but it's difficult to penetrate," said Mr. Thompson of Motorola. "The agreement helped, but it's nowhere near the goals."

Opening up the Japanese market is a concern not only to chip makers, but chip buyers as well. Companies such as Digital Equipment Corp. that buy semiconductors for use in their own component products want worldwide competition to keep prices down.

"You have to have a balanced base of supply in memory chips," said Mark Frederick, spokesman for Digital Equipment Corp. "As with any other commodity, you don't want one country as a base of supply."