Editor's note: In the first part of the series, the CEO of EMS KATEK Group discussed the genesis of the group that's now one of the six largest electronics manufacturing services providers in Europe.
Rainer Koppitz, KATEK’s CEO, along with the team at PrimePulse, were aware of the need for both speed and scale when they made their first acquisition and set the process of developing the KATEK Group in motion. Scale would be essential -- the business needed to be large enough to have the buying power to get the best prices and terms of the materials it would buy for clients. But perhaps more importantly executives knew that scale was essential to be taken seriously by the customers they wanted to attract and partner with.
Initially, management set what they thought was a high bar - reaching half a billion dollars in sales within five years. In reality, they got there in half that time with some strategic M&A work and solid organic growth in the companies they owned. This was accomplished in 30 months that included the worst of the disruptions cause by the pandemic.
And KATEK's bold ambitions don’t stop at reaching goals -- it's now the second largest EMS in Germany.
Globally, EMS businesses are now facing a shortage of semiconductors and many essential electronics components. Although post-pandemic demand remains strong, order fulfillment remains an uphill battle.
According to electronics trade association IPC, manufacturing sentiment remains high in Europe, but momentum slowed in September. The manufacturing sector reported strong rates of expansion in output, new orders, and employment, but all three declined from August. This led to the largest drop in the headline PMI index since April 2020.
Supply chain constraints and disruptions continue to hinder the manufacturing sector in Europe, not dissimilar from everywhere else in the world. But demand is also softening. Supplier delivery times continue to extend and shortages have led to weak purchasing activity. Shortages and disruptions have also led to higher prices.
One of Germany's notable industry sectors, automotive, also decreased in September. Auto production continues to be hampered by supply shortages. Auto production in the European Union remains off 43.7 percent from two years ago, according to IPC.