Electronics Contract Manufacturers Face Supply Chain Pileup

Monday, 13 September 2010 09:29

Read this week's issue - Sepetmber 13, 2010

Component shortages have led to a traffic pileup in the global electronics supply chain, with major contract manufacturers facing a challenging supply imbalance characterized by tight inventories of parts and fi nished products and a glut of raw materials, according to the market research firm iSuppli Corp.

A quick snapshot of inventory at five of the larger Electronic Manufacturing Service (EMS) providers showed that components and raw materials accounted for nearly 70 percent of total inventories during the first quarter of 2010, the latest date for which quarterly data is available. In comparison, work-in-process goods made up about 17 percent of inventories, while finished goods comprised less than 15 percent, semiconductor industry analysis from iSuppli shows. 

All told, finished goods were at their lowest level since the fourth quarter of 2008. And the current semiconductor trend—in which inventories are being weighed down by an overwhelmingly large percentage of raw materials— will continue for some time to come, iSuppli believes, given that more product in kits await to be finished.

Read more in the Sepetmber 9, 2010 iSuppli "Electronics Contract Manufacturers Face Supply Chain Pileup "

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