Found this article under JBIL news. It confirms the high growth rate the sector is experiencing.
"Electronics contract manufacturers continue global expansion to meet demands of this dynamic industry
ALAMEDA, Calif.--(BUSINESS WIRE)--July 1, 1997--The major electronics contract manufacturers are expanding at a phenomenal rate, moving into new regions as well as increasing square footage in the traditional ones.
Technology Forecasters Inc. has been tracking this industry for 10 years, and this year the major players are making significant movements into many regions, including emerging regions for the electronics industry such as Mexico, Brazil, China and Eastern Europe. Technology Forecasters is currently researching this high-growth industry for the upcoming report, Contract Manufacturing from a Global Perspective, the 1997 Update, which will be available in September.
With annual growth rates in the electronics contract manufacturing industry hovering around 30% for the last few years, contractors continue to seek ways of adding capacity and capabilities in customer-desired regions. Mexico -- with its low-cost labor, proximity to major customers in the United States and Canada, and favorable trade conditions -- is experiencing more and more contractors moving in. Major contract manufacturers that are new to Mexico this year include the industry's number two player, Solectron Corporation, as well as Avex Electronics, Jabil Circuit Inc., and Flextronics International. These four contractors are moving into Guadalajara. Contractors already operating in Mexico such as SCI Systems Inc., DII Group Inc., and Elamex S.A. de C.V., are increasing their square footage in the region. For example, SCI recently acquired Group Technologies' plant in Mexico City and DII is planning on building in Guadalajara. SCI has plans for moving into Hungary as well, a region that offers a low-cost strategic alternative for Western Europe.
SCI also has acquired the Group Technologies plant in Hortolandi, Brazil, while Solectron has acquired the Ericsson Telecom AB facility in San Jose dos Campos, Brazil. These acquisitions will allow both contractors to serve those customers demanding a manufacturing presence in South America so they can better access the market there.
Sandra Fox, vice president at Technology Forecasters, said, ``We thought 1996 was a tremendous year of acquisitions and mergers for the contract manufacturing industry, and so far in 1997, the trend is continuing.'' Celestica International Holdings Inc. (Celestica), a major contractor in Toronto, Canada, has made three acquisitions this year as part of its strategic plan to establish global presence and increase final system build capabilities. In January, the company acquired D2D, a major contractor and former subsidiary of ICL in the UK; in April it bought a Hewlett-Packard facility in Fort Collins, CO; and in June acquired a Hewlett-Packard facility in Exeter, NH.
Several Asian contract manufacturers, formerly with facilities in areas such as Singapore and Hong Kong, have moved manufacturing into China. Hong Kong-based Nam Tai Electronics Inc., and GET Manufacturing Inc., have moved all their manufacturing facilities to the mainland. Other contractors expanding in China include Solectron, Flextronics International and International Manufacturing Services.
The new report, Contract Manufacturing from a Global Perspective, the 1997 Update, will include detailed profiles of 150 contractors and customers of contractors, as well as forecasts of industry size, trends and technologies. Companies wishing to pre-purchase the report will immediately receive a complimentary copy of the 900-page report on global contract manufacturing published in 1995. Those interested in making a pre-purchase should call Technology Forecasters at 510/747-1900." |
