SHENZHEN, China — A two-day shut down of Hong Kong International Airport forced the cancellation of hundreds of passenger flights and caused a fair amount of anxiety in the electronics supply chain. However, as of August 15th, passenger flights had returned to normal and supply-chain pressure had eased. The negative impact on imports, exports and…
The two-day closure of Hong Kong International Airport (HKIA) had not impacted air cargo as of late Tuesday, although future delays appear inevitable. Given the volume of freight that passes through the airport — 5.1 million metric tons in 2018—any disruption of air traffic can hinder cargo departures. Air freight carriers, including Cathay Pacific, FedEx,…
The midpoint of the year not only brings new challenges and opportunities, but also provides the chance to reflect and plan for the months ahead. The fast-approaching servitization-centered economy, where companies will no longer sell just products, instead owning the responsibility for the business outcome those products deliver, will encourage a shift to subscription-based businesses…
Editor’s Note: This is the second of two articles examining the impact of tariffs — positive and negative–on the electronics industry. For political pundits, the United States government’s tariff strategy is about political leverage. For electronics OEMs, however, tariffs are about business. “As a United States patron, I look at it through the lens of…
Sixty percent of companies make offshore-sourcing decisions based on rudimentary metrics, such as wage rate, ex-works price or landed cost, often resulting in a 15 to 30 percent understatement of actual offshoring costs. Inclusion of all relevant factors—overhead, balance sheet, risks, corporate strategy and other external and internal business considerations—provides a better determination of the…
The causes, effects and implications of “The Great Component Shortage of 2018” have been thoroughly analyzed. The automotive and IoT industries have been driving unprecedented demand for smaller and more efficient passive electronics, which in turn has stretched lead times for these once- commoditized components to the breaking point. What hasn’t been discussed, however, is the equal…
Electronics component shortages are now so severe that some OEMs believe their growth for 2018 could be stymied if they are unable to get parts. “We have not missed deliveries yet, but we are on the edge,” said George Whittier, COO at manufacturing and engineering services provider The Morey Corp. “Shutting down one of our…
Electronics OEMs count supply chain risks as the most troubling set of challenges their businesses face, ahead of global economic malaise and geo-political issues. Problems such as inaccurate forecasts, sourcing constraints, supplier consolidation, pricing fluctuations, inventory management problems and the negative effects of natural disasters on shipping, procurement and logistics top the list of operating…
Historically, the semiconductor and electronics industry is a story of ebb and flow: the cycles of demand and the lulls that follow. Mix in the greater, macro-economic waves of variables that push or pull at consumer confidence and spending and you get a pattern that held out for the better part of several decades. The…
Purchasing conditions continue to whipsaw in the electronics industry but OEMs and contractors remain on top of the food chain, benefitting from weak pricing and easy availability of supplies amidst heavy discounting by harried vendors. However, OEMs, too, are stressed with uncertain demand, the stronger dollar, a potential hike in U.S. interest rates and conflicting…