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Too Much of a Good Thing in Asia?
As demand picks up in the EMS industry, low-cost Asian sites are seeing more than their fair share of new business. That's a good thing for EMS providers because higher capacity utilization helps their margins. But an industry consultant warns that busy Asian plants in some cases may not have the resources to ramp new programs as fast as OEMs would like.
"For instance, if the OEM's program is not a good fit technically, i.e. requires new processes or higher level of process control, then time to quality production might require considerably more time than scheduled," said Robert
Freid, president of
Contract Manufacturing Consultants (Bellevue, WA), "OEMs should take this into consideration when deciding among suppliers."
Freid believes that smaller programs are more likely to face this problem since major global accounts have the leverage to get resources allocated to them.
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