EMS Firms at Electronics West Positive about Economic Outlook
ANAHEIM, CA – Producing a trade show in the middle of a recession rarely brings out the best in people. Sometimes, it doesn’t bring out the people at all. However, this year, as the recovery starts to settle in, Electronics West brought out a number of EMS firms positive about their 2010 outlooks; some even experienced solid growth in the last three years.
Last week’s show floor was extremely busy the second day after heavy rains the first. (I noticed a marked improvement from attendance last year.) The buzz in the booths seemed to be the medical market, which was mentioned by nearly everyone as being their busiest segment.
John Koon of EMS firm Express Manufacturing Inc., based in Santa Ana, CA, said the medical and wireless markets are big right now. The company also supplies to the telecom, industrial and computer markets.
The firm has signed a development agreement with Beyonics, a $1 billion EMS firm in Singapore. And even though EMI has a facility in China, the relationship is symbiotic because the companies have different types of customers. EMI is a mid-size company that refers large projects (in excess of $200 million) to Beyonics; smaller or regional projects (under $200 million) are offered to EMI.
On a global scale, Koon called 2009 the worst year he’d seen in the industry as a whole in 30 years. “It was worse than the dot com bust,” he explained. He sees 2010 as “real world transitioning” for the industry. “Business is slowly turning for the better. People are cautious, but they are not sitting on their money like they were before.”
In spite of the recession, Anoka, MN-based Altron Inc. invested in capital equipment at the end of 2008 and beginning of 2009. The contract manufacturer purchased a new SMT line, buying $2 million worth of equipment when prices dropped.
Medical is its largest market as well, but it also works in industrial, GPS, military, aerospace, computer, telecommunications, commercial and health/fitness. A company spokesman said the recession hasn’t affected them.
Similarly, NBS, in Santa Clara, CA, said it wasn't affected by the global economic crash, increasing business in each of the last three years. When it started, the mid-size firm did NPI for any type of customer and built its business to 180 customers. When the economy tanked, companies came from larger firms. NBS specializes in high-mix, low-volume, and has doubled its revenues over the last two years. Because it does evaluation boards, when customers have new components on their boards, the firm has most likely seen them already.
Last year, NBS hired over 150 staff, bringing its total to 425 employees. The firm is looking to increase its SMT manufacturing space, currently 40,000 sq. ft., not including a 10,000 sq. ft. second building for box-build and configure to order.
The firm works in the military, aerospace, telecom, and medical markets, with the latter continuing to grow in the last few years.
Another EMS exhibitor that asked for anonymity claimed revenues have tripled in three years to $100 million, on demand for medical, military and aerospace. It said growth and demand were slowing at present.
Among the other exhibitors CIRCUITS ASSEMBLY spoke with, Flex Interconnect Technologies said its medical and defense businesses remain steady; military-focused Manconix reported heavy industrial growth this year; and Electronic Source Co. said sales were down 22% last year.
