TAIPEI CITY, TAIWAN -- Test Research Inc. reported first-half sales rose 7% year-over-year on broad demand for the company's automated optical inspection equipment.

ST. PETERSBURG, FL – Jabil Circuit said it would acquire Telmar Network Technology for an undisclosed sum.

Texas-based Telmar makes communications network gear and had revenues of $145 million last year.

Jabil posted $13.4 billion in revenues in its fiscal year ended Aug. 31.

The deal is expected to close in November.

HONOLULU – Regionalization is an ongoing trend in electronics, and Mexico is making a surprising run at China, according to Charlie Barnhart & Associates.

Based on a CBA survey of North American-based midmarket OEMs, China and Mexico ranked better than the US and Canada for high-volume manufacturing and continuous flow, while China topped Mexico in those two categories. However, in every other respect, Mexico tops China.

In general, manufacturing is moving from the US to Mexico; from Western to Eastern Europe; and from China to Mexico and Southeast Asia, CBA says. Each of the growth regions has its drawbacks, however, CBA analyst Eric Miscoll said in an Aug. 24 webinar. Apprehensions in China include IP theft, increasing labor rates, freight/logistical costs, quality, material support, communications and the legal environment of the country. Mexico has issues with violence and safety, political stability, workforce and product quality, work ethic and material sourcing.

Miscoll said the longtime factor of labor costs is influencing where companies manufacture products. Specifically, in the first half of 2011 in the US, the industry average per direct labor hour was $39.32, compared to $34.50 in 2003. In the first half of this year in China, the amount in US dollars was $11.83, compared to $6.90 in 2003. However, Mexico’s labor rate dropped, with the first-half 2011 figure at $11.26, compared to $16.73 in 2003. In the second half of 2011, Mexico’s cost of labor will increase slightly (about 1.1%), according to the firm.

CBA says China prevails in commoditized products and has more mature designs compared to Mexico. China’s focus is mostly on communications, computer and consumer markets. On the other hand, Mexico generally produces larger, heavier products for the automotive, appliances and aerospace sectors destined for the US.

CBA offered up a pair of case studies supporting its data. In them, Applied Technical Services, a contract electronics manufacturer with operations in Everett, WA, and Hermosillo, Mexico, has a turnover rate of less than 5% in Mexico, and most of its employees speak English well. ATS hasn’t experienced any safety issues in the area, and labor rates are increasingly competitive with Asia and India. The firm also noted the stable currency relative to the US dollar, and low (2%) employee absenteeism.

BANNOCKBURN, IL – A new benchmark study compares financial and production data of electronics manufacturing services companies.

“IPC Study of Quality Benchmarks for the Electronics Manufacturing Services (EMS) Industry for 2010” baselines 2010 operating variables among EMS providers by net sales and type of product. 

The survey-based study covers financial and production data, assembly attributes, yields, defect rates, customer returns, supplier performance, customer satisfaction and certification data.

The data are based on an IPC survey of 29 EMS companies from North America with total sales revenue of $7.05 billion. Participants provided point-of-reference data for sales growth, expenses on R&D and capital equipment as a percentage of net sales, average collection and payable periods, and the number of printed circuit boards completed in 2010.

Respondents also reported internal yields for surface mounting, wave soldering and selective soldering. All of the respondents included relevant customer satisfaction metrics regarding returns and on-time customer deliveries.

For more information, visit www.ipc.org/Benchmark-10.

COLUMBIA, MD -- Researchers at the University of Maryland’s Center for Advanced Life Cycle Engineering have independently found tin whiskers in Toyota vehicles with potentiometer type accelerator pedal position sensors (APPSs).

TAIPEI -- Steve Jobs' abrupt retirement will bring no change to Apple's day-to-day dealings with Foxconn Technology Group, the latter said today.

CUPERTINO, CA — Apple chief executive/tech icon Steve Jobs has resigned, effective immediately.

WASHINGTON -- In a sharp turnabout, the Ozone Transport Commission today released a updated draft of its model rule for emission reduction, proposing a substantially higher limit than in the previous draft.

SUWANEE, GA – ASM Assembly Systems Americas has named Otto Waters chief executive. He replaces Butch Garrison, who had been with the former Siemens placement equipment unit in various roles since January 1995.

SPOKANE VALLEY, WA – Contract electronics manufacturer Key Tronic Corp. today reported fiscal fourth-quarter 2011 net income of $1.5 million, down 34.8% year-over-year.

BANNOCKBURN, IL – Worldwide production of printed circuit boards in 2010 grew 19% year-over-year to approximately $54.8 billion, says IPC.

PALO ALTO, CA – Hewlett-Packard's plans to concentrate on business servers could have startling ramifications for the worldwide electronics supply chain, by spinning off or selling its Personal Systems Group and discontinuing WebOS tablet and smartphone products.

The PSG was HP’s largest business unit in the second quarter, with $9.6 billion (30.8%) in revenue. HP is expected to divest the unit, however, due to its relatively low growth and operating margins.

Speculation on potential buyers has thus far centered HP’s major PC competitors and certain Asia-based ODMs. HP’s PC market share in 2011 is 18%, placing it first in the world, ahead of Dell, Acer and Lenovo. If HP sells its PSG to Samsung, the latter’s market share would soar from 4% to 22%. Moreover, the component supply chain would be dramatically affected, as Samsung would likely leverage the acquisition to create a new channel for its memory components and batteries, thus pushing out a number of Taiwanese vendors.

If Lenovo were to purchase HP’s PSG, its market share would rise from 12% to 30%, surpassing Dell and Acer’s combined market share. (Dell and Acer currently rank second and third, respectively.)

Inventec, Quanta, Foxconn and Wistron, the major ODMs for HP’s notebooks, account for 25~30%, 30%, 20~25%, and 5% of HP’s shipments this year, respectively.

If HP sells PSG, Inventec is expected to suffer the most severe setback because HP totals 60% of Inventec’s NB shipments, says research firm TrendForce. HP’s WebOS tablet TouchPad is exclusively manufactured by Inventec.

If HP divides and sells part of its PSG, the potential client order decline is expected to mar ODMs’ revenues. On the other hand, since Quanta possesses the greatest client diversity among the ODMs, regardless of the final buyer for HP, Quanta will most likely continue to receive orders from this new client, according to the research firm.

In Foxconn’s case, HP and Dell account for almost 70% of its NB shipments in 2011. In 2012, however, the NB shipment ratio from HP is expected to increase, while Dell may decrease. Consequently, if HP’s orders also drop in 2012, it would affect Foxconn drastically, says TrendForce.

Foxconn dedicates one of its more than 12 production divisions exclusively to HP. A potential Foxconn acquisition of HP’s PSG would be influenced by the ODM’s other clients and a potential lack of capital. But given the aftershock if Samsung were to purchase PSG, Foxconn might feel the need to make a play.

On the other hand, Compal and Pegatron, both not currently included in HP’s supply chain, would mostly likely benefit from other companies’ acquisition of HP’s PSG.

HP’s PSG sale will not affect Taiwanese NB ODMs’ businesses as a whole because the cooperative system between brand vendors and ODMs has been established for years. Regardless of the final buyer, they will most likely outsource their production orders to Taiwanese ODMs. However, in the long run, it may change the dynamic between Taiwanese NB ODMs and affect the global PC ODM industry, according to the research firm.