The consumer electronics industry finished 1987 with a record $30.69 billion in sales and should surpass $32.24 billion in 1988, industry representatives were told Thursday.
The upbeat financial news came at the opening of the Winter Consumer Electronics Show, a Disneyland of electronic gadgetry where more than 100,000 people are expected to view the wares of 1,400 exhibitors.
The show features a wide array of electronics products spread over exhibit space the size of two dozen football fields--products that will be making their way to dealer shelves in the next six months.
Thousands of video, audio and home information products are exhibited at the show, the 16th annual winter event here and the counterpart to a summer show in Chicago.
Also featured during the four-day show are 36 informational sessions on topics such as the impact of Wall Street, educating the consumer, home automation, electronic toys and games, car audio and threats to the adult video market.
Keynote speaker David Gergen, editor of U.S. News & World Report, discussed the economy and its political impact and effect on the industry. He gave an upbeat forecast for 1988 but said tougher times might be ahead in 1989, 1990 and 1991 because of decisions that have to be made about the federal budget deficit and trade imbalances.
"I think we've seen the bottoming out of the dollar," Gergen told manufacturers, dealers and distributors attending the giant trade show. "Jan. 15 is the date to watch now. That's the day when the numbers come out on November's trade balance. I have a feeling that the numbers will be all right. If that happens, we're going to see a jump in the American stock market, and I think the American dollar will not just stabilize but go up."
Gergen predicted an inflation rate of 5% to 6% in 1988 and a 2% to 3% growth in the economy. He said consumer spending would drop some from 1987.
Hard political decisions made today, such as cutting the budget deficit, will determine the numbers in the years following 1988, Gergen said.
"Only a strong President will be able to do what needs to be done," he said. The chances of electing a strong President are about 3 or 4 on a scale of 1 to 10, Gergen said.
"I think life will be tougher for the next President," he added. "A lot of decisions have been postponed on the budget and the trade deficit."
A second keynote speaker, Frank Myers, president of Arvin Electronics, focused on the industry's record year in 1987 and the outlook for 1988. He said the industry had been able to survive the October Wall Street plunge and a falling dollar.
"We may have a problem or two, but $30 billion and growing doesn't seem like a disaster to me," Myers said.
"The reason, I think, is the industry's amazing ability to adapt, to deal with a multitude of issues concurrently," Myers said. "For example, the country-of-origin label which formerly read 'Made in Japan' increasingly reads 'Made in Singapore, Taiwan, Korea, Malaysia, China, Mexico' and even 'The USA,' as Japanese and other offshore producers relocate to offset the escalating currencies."
Myers issued an economic forecast for the industry for 1988, admitting that "the confidence level of the projections . . . are perhaps a bit less firm than they've been in the past."
The video segment of the electronics market is expected to lead the way again in 1988, with $13.402 billion in sales projected. Audio equipment is expected to reach $8.525 billion in sales. Home information equipment such as home computers, telephones and phone answering devices should account for $4.960 billion in sales, Myers predicted.
Related products, from computer software to audio and video accessories, should account for $5.360 billion in sales, he said.
The figures are compiled by the Washington-based Electronics Industries Assn., sponsor of the show.
Although the Walkman-style cassette player, the videocassette recorder and the compact disc player have made their debut at previous Consumer Electronics Shows, officials say no major innovations are expected this year. The 1988 show will, however, demonstrate strides in the super VHS and extended definition Beta, which give clearer and stronger pictures .
Last year's attendance of 105,784 was believed to be a record for a trade show, according to show officials. Attendance this year is expected to top that mark before the event closes Sunday.
The show is closed to the public.