TORONTO – SMTC is expanding its capacity in Mexico, but its other North American plants remain moderately full.
On a conference call with analysts last week, president and chief executive Eddie Smith said capacity utilization at the EMS company’s Chihuahua facility is above 80%, leading to a new extension to its building there.
That makes the 215,000 sq. ft. Chihuahua campus the busiest among the company’s five sites. The Fremont plant is at about 60%, ahead of Billerica (suburban Boston) at about 50% but behind Melbourne, FL, which is closer to 70%, Smith said.
They are all ahead of SMTC’s other plant in Mexico. The 80,000, sq. ft. site in Zacatecas is below 50% utilization.
SMTC closed its China plant and relocated the equipment to Mexico over the past two quarters.
“I think the only plant that really has what I would call a need to expand in terms of footprint would be Chihuahua,” Smith said. “The rest could probably add a significant amount of business and not have to expand the footprint. [We] may have to buy some equipment, but we have plenty of expansion room.”
Smith said that despite the pressure on aerospace and defense spending, the company doubled its percentage of overall revenue from that sector to 10% in the just competed quarter and expects it to be 25% to 30% a year from now.
He added the effects of Covid-19 “have affected our business here and there,” but haven't been “dramatic.”