As alluded to in my post from earlier today, a pair of East Coast fabricators have closed on a deal. However, out of consideration for the company being bought — which, I’m told, wants to notify its customers first — I’m going to sit on the news for a day.
Author Archives: Mike
Board Buys Back
While the talk of DDi-Coretec and TTM-Meadville and Viasystems-Merix understandably rules the headlines, there are plenty of smaller deals taking place too.
Indeed, market analysis shows that the most difficult time for most flailing companies comes not during a downturn but on the recovery end of the slope.
Whether that’s the case with FM Circuits or Waytec is not clear, but both firms have been snatched up by Epec in recent weeks, the latter being announced today. We also get news of another small East Coast PWB fabricator in play; hopefully we can report that later today.
I’m not surprised about these deals. In fact, if anything, I’m surprised there aren’t more taking place.
Fired Up
Lost in all the hubbub over whether TBBPA and its cousins pose an realistic* environmental threat is the basic consideration of why those flame retardant chemicals are used in the first place: to help save lives.
May is National Electrical Safety Month in the US (we may not build much anymore, but we lead the world in calendar promotions), and a chemical supplier named Earthwise has published a pseudo public service announcement reminding that deaths from fires and burns are third leading cause of fatal home injuries in the US.
I won’t deny Earthwise’s agenda here, but let’s keep in mind that while TBBPA may cause harm to humans under certain extraordinary circumstances, it’s nothing compared to the life and property threat a burning electronics device could pose.
*While the literature suggests direct contact with or inhalation of TBBPA can have harmful effects, in practice, this would be rare.
Patently Slow
Further delays by the International Trade Commission panel tasked with resolving a two-year patent battle between Rambus and Nvidia underscore how difficult it is to determine cases involving highly technical IP – and also why the rules need changing.
The stakes are so high, when Samsung settled with Rambus in January, it agreed to pay $700 million in cash over five years – and buy a big stake in Rambus. Now the ITC wants to know how that deal might affect the rest of the case.
That’s reasonable, I suppose, but in the meantime, electronics designers face the no-win choice of either designing in chips known to be part of a patent dispute, or finding something (probably) less desirable as replacement.
And who do you think pays in the end?
Apple Bites Man
While no company outshines Apple when it comes to design and marketing, some of its other endeavors need work.
Apple has a long and tiresome history of using alleged sweatshops to build its latest gizmos, and outsources heavily to Foxconn, where no fewer than 10 workers have committed suicide this year.
Apple’s response? As reported in the Wall Stree Journal today:
Apple spokeswoman Jill Tan: “We are definitely concerned … but would like to emphasize that Apple is committed to ensuring the highest standards of social responsibility wherever Apple products are made.”
Her quote is followed by this damning statement: “Apple conducts annual reviews of final assembly manufacturers to uncover any possible violations of its Suppliers’ code of conduct. In its 2010 Supplier Responsibility Report, it found that 65% of the 102 facilities it audited were paying the wages and benefits due to workers.” [itals mine]
What, in Apple’s eyes, constitutes “highest standards?” Would it accept a 65% yield on its iPods or iPhones?
I don’t think so.
Foxconn’s ‘Dispiriting’ Suicide Response
Ten attempted suicides (eight successful) in 10 months has Hon Hai (Foxconn) reeling from yet another round of bad press.
Against all odds, the situation has worsened as bloggers have uncovered a video purported to show Foxconn security guards beating an employee. (Is this the Shenzhen citadel, or Abu Ghraib?)
Terry Gou, Hon Hai’s founder and chairman, today insisted to the Wall Street Journal that his company is “not a sweatshop,” and that several measures are being taken to get to the root of the deaths. Among the responses:
- A suicide hot line.
- Outside counseling.
- A “Foxconn Employee Care Center.”
- A prayer group led by Buddhist monks.
DigiTimes, the excellent Asia-based news source, reports Foxconn is even bringing in an exorcist to help deal with the demons plaguing its factory workers.
Nothing against those who free the world from diabolical spirits, but my advice is tad simpler: Treat your workers better.
In the Money
Look for our annual circuit board designer salary survey coming up in the June issue.
This year, we asked designers about their biggest challenge. The responses could be loosely grouped into four categories and, interestingly enough, three of the four having nothing to do with technical hurdles.
Barnhart on Regionalization
Charlie Barnhart’s group has conducted an interesting survey on regionalization. A quick rundown of the findings:
- Is it best to manufacture electronic products in the region into which the product will be sold? 84% agreed to some degree.
- Is your company currently utilizing a regional approach to electronics manufacturing? 80% said yes to some degree.
I don’t think the survey was scientific. It sounds like respondents were visitors to his website, and there’s no telling whether people voted more than once, or how many people voted, etc.
But like much of Charlie’s work, it’s always good water cooler conversation.
Nokia Goes Out
Good news for Top Tier contract assemblers came today in the form of Nokia’s announcement it would begin outsourcing again, a year after pulling everything in house.
Just another sign that the market is recovering.
Nokia announced last July it would bring all its electronics assembly production in house as falling demand led to excess capacities at its factories.
Foxconn, BYD, Jabil and Elcoteq were Nokia’s primary EMS suppliers in 2008, when it outsourced a reported 17% of its manufacturing.
Trading in on Climate Bill
Tucked away in the climate change bill introduced in the US Senate this week by John Kerry (D-MA) and Joe Lieberman (I-CT) is a provision that calls for unilateral US action against any nations that have not enacted emissions limits.
Specifically, the American Power Act states that, pending the enactment of a global agreement on climate change by Jan. 1, 2020, imports from non-compliant countries would be subject to a tariff to avoid “carbon leakage” (i.e., the transfer of manufacturing operations to sites with lower emissions standards).
In a nod to World Trade Organization agreements, the senators assert this “border adjustment” would comply to WTO rules (see page 3).
NAM’s response to the bill was mixed, and focuses more on other aspects of it, specifically provisions for offshore drilling.
The potential ramifications of such a law are interesting, especially in light of China’s (aka The World’s Workshop) resistance to almost any form of external environmental pressure. Certainly the world will be a very different place in 10 years, and it’s impossible to know whether technology and other innovations will have allowed the US to wrest back control over certain manufacturing markets. But personally, I don’t think this bill has any chance of becoming law, so it’s probably a moot point.