Flextronics CEO Sees More Production Headed to US PDF Print E-mail
Written by Mike Buetow   
Friday, 14 December 2012 08:43

NEW YORK -- The chief executive of Flextronics this week became the latest to suggest the US is in line to reap a larger share of the manufacturing pie.

With labor costs in the self-styled World's Workshop soaring and expected to continue to do so, Flextronics, which between its contract assembly and printed circuit board fabrication division Multek has more than one million sq. ft. of manufacturing space in China, is delving deeper into the decision-making process over where to situate its plants.

Speaking at the annual Raymond James IT supply chain conference, CEO Mike McNamara said that as pressure rises on Flextronics' costs, it makes other options "more interesting."

Production costs rose 20% this year in China and are expected to rise 20% per year for the next five years, Flextronics said, while labor rates are also rapidly rising in Malaysia and Indonesia.

"What that is going to do is probably push more work into Mexico. And, over time, as those costs continue to go up, you'll probably see more things get pushed back in the USA,” McNamara said. “With the costs continuing to go up around the world like they are, and with the cost in the United States staying relatively flat over the last few years, I would expect you would to see a little bit more coming back."

Still, the labor rate is just one component, and the US needs to move toward higher levels of automation as well, McNamara opined. "It is not just flipping a switch. You actually have to spend a lot of work in the design, all the way through to the manufacturing process, knowing where you are going to manufacture. So I think it is going to take time,” he said.

 

Last Updated on Monday, 07 January 2013 09:17
 

Columns

Eastern-US: China’s New Competitor?

Parity emerges among EMS Factories from Asia, Mexico and the US.

For the first time in years we see parity in the Eastern US among EMS factories from Asia, Mexico and the US. This EMS market condition will permit American OEMs (the EMS industry refers to OEMs as customers) to have more EMS pathways to choose from. Now more than ever, such EMS assignments will require deeper investigation relating to the OEMs’ evaluation of manufacturing strategies.

Read more...
 
The Human Touch

For those who count on the electronics industry for big feats, it’s been a remarkable couple of years.

Read more...
 

Features

Advances in Concentration Monitoring and Closed-Loop Control

Contaminated bath water skews refractive index results. New technology can accurately measure aqueous cleaning agent concentration.

Read more...
 
Circuits Disassembly: Materials Characterization and Failure Analysis

A systematic approach to nonconventional methods of encapsulant removal.

Read more...
 

Search

Search

Login

CB Login

Language

Language

English French German Italian Portuguese Russian Spanish
 

Products

Panasonic Debuts PanaCIM Maintenance with Augmented Reality
PanaCIM Maintenance with Augmented Reality software provides instant communication and information to factory technicians -- when and where it is needed -- so they can respond to factory needs more...