General Sector-Specific Conditions

We supply products to a wide range of industrial sectors. Our main customers are in the semiconductor, solar, chemical, construction, energy and electronics industries.

The semiconductor market was extremely difficult in 2009. As one of the three largest producers of silicon wafers, WACKER definitely felt the effects. In the first quarter, pricing and demand pressures were particularly strong, mainly impacting plant utilization and earnings. Primarily in the second and third quarters, global demand for semiconductors and thus silicon wafers rebounded. Gartner, a market research institute, estimated demand for silicon wafers in 2009 at 6,480 million square inches (MSI). That is a decline of almost 23% year over year.

Semiconductor Market Extremely Difficult in 2009

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Installation of New PV Capacity in 2008 and 2009









Installation of New
PV Capacity (MW)











Sources: European Photovoltaic Industry Association (EPIA), Global Market Outlook for Photovoltaics until 2013.


CAGR: compound annual growth rate






















Other European countries




























Other regions














After a sluggish start, the photovoltaics (PV) market gained growth momentum in the second half of 2009. A series of negative factors subdued the market in the first half. First and foremost, Spain (the largest PV market) limited newly installed gigawatt (GW) capacity to 0.5 GW. The PV market was also negatively impacted by production cost pressures for solar wafers, cells and modules, by a reluctance to finance major solar projects, by discussions on feed-in tariffs and by lower prices for traditional energy sources. Thanks to stronger demand for solar arrays in the second half of the year, newly installed photovoltaic capacity rose by 1.2 GW to 6.8 GW. According to the EPIA (European Photovoltaic Industry Association), over a third of this capacity was installed in Germany. As a cost and quality leader for the production of crystalline polysilicon (the key raw material for photovoltaic systems), WACKER continued its growth in this business. Our entire output was sold on the market, which meant that WACKER POLYSILICON’S sales rose significantly. Overall, the production volumes of our facilities increased year over year by 6,200 to 18,100 metric tons.

Photovoltaic Market Continues to Grow

Global chemical production declined in 2009. Following a sharp downturn in the first quarter, demand stabilized at a low level for the rest of the year. The German Chemical Industry Association (VCI) estimates that the global chemical industry generated sales of €2.5 trillion with chemicals and services in 2008. In Germany, the chemical industry experienced one of its toughest years ever as production declined by 10% and capacity utilization reached only 77%. With every chemical segment affected by these trends, German chemical sales dropped 12.5% to €154.4 billion. WACKER’s chemical segments were not immune to the decline either. At WACKER SILICONES, sales dropped 12.1% and at WACKER POLYMERS 14.3%.

The global construction industry also suffered from the effects of the economic crisis. According to calculations from Global Insight, a market research institute, the industry posted a decline of 4.9% to US$ 5.4 trillion. That is the sharpest drop in the past 20 years. Residential construction was the hardest hit, down by over 23%. Commercial property saw a decline of almost 9%. Infrastructure projects, supported by economic stimulus programs, remained stable. Regionally speaking, only Asia saw increased spending on construction, with activity declining in all other regions.

Global Construction Industry by Region in 2008 Global Construction Industry by Region in 2008 (graphics)

Source: Global Insight

WACKER POLYMERS saw its sales volumes decrease in the USA, eastern Europe, Spain and the Middle East. In western Europe, and particularly in Germany, demand was relatively stable. Sales volumes only fell at a single-digit percentage rate. In contrast, demand grew in Brazil, India and China. On the applications front, too, trends varied. While the tile-adhesive business showed a marked decline, WACKER POLYMERS increased its sales volumes in the field of energy-efficient and sustainable construction – a key megatrend. Stimulus packages around the world helped here by promoting “green building.”

The global electrical and electronic goods market faced weaker demand in the year under review, having generated sales of some €2.6 trillion in 2008. Yet it remains the largest product market. In Germany, production fell by around 20% (adjusted for prices) in 2009. The slump had a particularly negative impact on WACKER SILICONES and Siltronic in the first half of the year. In the second half, orders began to increase again.

Overall Statement on Underlying Conditions

During the first half of 2009, the global economy continued to decline, although stabilizing at a low level, especially in the second half. Particularly hard hit by the recession was the semiconductor industry, including Siltronic, where plant-utilization rates were below 50% at times. As for our WACKER SILICONES and WACKER POLYMERS chemical segments, they were also unable to match their prior-year sales levels. Raw-material and energy prices were lower compared to 2008 and had a positive effect on our cost structure, as did strict cost management in the area of personnel and material expenses. Contrary to the general trend, our polysilicon business continued to develop well, once again achieving double-digit percentage gains in sales and earnings in 2009.

The greatest signs of recovery were in Asia, particularly China, even though sales were slightly below the prior-year levels. Overall, Asia’s share of total sales continued to rise. Europe remains the second most important market for WACKER products. Sales in the USA were clearly down on the prior year. See further details on Regions