Nothing Final

I’m not sure to which “last bastion” the author of this piece on outsourcing refers: India, consumer electronics, or product engineering. But no matter the hypothesis, there’s problems with each.

From the top, India will hardly be the last source for low-labor cost manufacturing. I would argue that the heretofore untapped sub-Saharan Africa — home to one billion or so people — will someday own that title.

Second, consumer electronics are already highly outsourced, and once Sony caves — and it will — OEMs in that space will be little more than brand names, having ceded design, manufacturing, procurement and even advertising to specialists.

Finally, product engineering is also a highly outsourced, if indirectly. The author claims outsourced product engineering services could be worth $8 billion to 11 billion this year, but I suspect he’s counting only direct costs. Design re-spins are commonplace, and typically based on issues uncovered down the line. Who among us doesn’t see regular ECOs that are driven by data generated at fabrication or assembly or test? It may not show up in the numbers, but that’s a matter of accounting, not reality.

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About Mike

Mike Buetow is editor-in-chief of Circuits Assembly magazine, the leading publication for electronics manufacturing, and PCD&F, the leading publication for printed circuit design and fabrication. He is also vice president and editorial director of UP Media Group, for which he oversees all editorial and production aspects. He has more than 20 years' experience in the electronics industry, including six years at IPC, an electronics trade association, at which he was a technical projects manager and communications director. He has also held editorial positions at SMT Magazine, community newspapers and in book publishing. He is a graduate of the University of Illinois. Follow Mike on Twitter: @mikebuetow

2 thoughts on “Nothing Final

  1. After reading this article, and reconizing the author, I’ve come to the conlcusion that this is a bit of marketing hype.

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