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SAN JOSE – The Semiconductor Industry Association is calling on Congress to put aside its differences and agree on a plan to address the financial crisis.

“There is broad agreement that the federal government must take action promptly to address the current financial crisis,” said SIA president George Scalise in a press release. “The issues that contributed to the failure of the recovery legislation Monday can be resolved, but it will take bipartisan cooperation.

SIA said Congress must restore consumer confidence by taking action on a recovery package this week. “Consumer demand accounts for more than two-thirds of the U.S. economy,” Scalise said. “A slowdown in sales of a broad range of consumer products such as personal computers, cellphones, and entertainment electronics would have an adverse impact on semiconductor sales in the fourth quarter, which is normally the strongest quarter for the chip industry.

“The entire supply chain including our suppliers and customers will be harmed if access to credit becomes difficult. Restoring consumer confidence must be a top-priority in crafting legislation that can achieve strong bipartisan support. As long as consumers have major concerns about job security, the value of their retirement portfolios, and their home equity, consumer spending could be curtailed, leading to an overall economic slowdown,” he said.

SAN JOSE – Global sales of semiconductors grew 5.5% year-over-year to $22.7 billion in August. Sales were up 2.4% from July on demand for PCs and mobile phones, the SIA said. For the year through August, sales were $170.2 billion, up 4.5% from 2007.

“Global sales of semiconductors remained strong in August,” said SIA President George Scalise. “Sales of personal computers and cellular handsets continued to be the principal drivers of demand."

Price pressure on memory is slowing revenue growth. Excluding memory products, industry sales were up 11.4% year-on-year in August. Year-to-date sales were 4.5% ahead of last year and remain in line with the SIA mid-year forecast of 4.3%.

PC unit sales are projected to grow by more than 13% in 2008, says Credit Suisse. Unit sales grew 9.1% year-on-year in August, a modest slowdown from July. Worldwide unit sales of cellular handsets remained strong – especially in emerging markets. Unit sales of cellular handsets are forecast to grow about 10% in 2008, with the strongest growth coming from emerging markets.

Earlier this week, SIA urged Congress to pass a financial package to bail out Wall Street banks overwhelmed by bad mortgage debt. “With consumer purchases now driving more than half of semiconductor sales, consumer confidence is essential to the entire supply chain of the global technology sector; thus it is essential for Congress to move swiftly to restore stability to the US financial system,” Scalise said.

Tags: cell phones, laptops, desktops, semiconductors, electronics manufacturing, EMS, components