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Electronics Production | February 13, 2009

Reverse Trend in Regional Sourcing in the Interconnect Industry

Forty-two percent of responding companies cited changes in their customers’ sourcing patterns from Asia back to North America or Europe in the past two years, according to the results of a survey conducted by IPC.
The report on the results, A Reverse Trend in Regional Sourcing in the Worldwide Electronic Interconnect Industry, was released in January 2009. Executives and marketing professionals at electronics manufacturing services (EMS), printed circuit board (PCB) and supplier companies in North America and Europe were polled for the survey during November 2008.

“There has been some speculation recently within the electronic interconnect industry that some customers may be changing their sourcing patterns and shifting some business back to North America and Europe from Asia for a variety of reasons,” said Sharon Starr, IPC director of market research. “The goal of the survey was to confirm this trend, estimate the financial impact on the industry and identify the drivers of the trend. Although the intent was not to produce statistically significant data, we definitely saw some evidence of regional shifts.”

Fifty companies responded to the survey. The respondents estimated that an average of 2.5 percent growth in their 2007 and 2008 business was attributable to this trend. The issue that was cited most often as the primary driver of this trend was quality concerns. Other key contributors were transportation costs, currency exchange rates, long supply lines and communication difficulties.

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