NOTE: This article was updated on September 16, 2019 to reflect recent information regarding tariffs.
Two days after Independence Day 2018, President Donald Trump’s aggressive new tariffs went into effect, imposing an extra 25% tax on imported Chinese goods. This affected over $50 billion worth of “industrially significant technologies” used by U.S. electronics manufacturers and their buyers.
It’s too early to tell with certainty how U.S. tariffs on Chinese goods implemented in 2018 will truly affect U.S. electronics contract manufacturers. The signals from major players like Cisco Systems, Apple, and IBM so far are not happy ones.
Conflict minerals are both a vital component (no pun intended) of the electronics industry and at the same time one of its biggest headaches. Since 2010, U.S.-based electronics companies have been required to determine whether certain components in their products came from the Democratic Republic of the Congo, one of the world’s largest sources of conflict minerals.
In 2006, the European Union rolled out a directive restricting the use of certain hazardous chemicals. This directive, Restriction of Hazardous Substances (RoHS), would have a far-reaching impact on the electronics industry. Its restrictions on using lead would send manufacturers scrambling to revise their practices or adopt entirely new ones. Thanks to a follow-up directive in 2011, manufacturers now hustle to meet RoHS 2 compliance.
Yes, it’s not a punitive law full of fines and penalties. But if you’re a U.S. company, noncompliance is basically an impassable barrier to entry to the EU trade market. So if you want to do business abroad, don’t mess around — comply. More
If your manufacturing projects involve electronics, you’re likely facing the challenge of extended electronic component lead times. Certain parts that used to take 12 weeks to come in are now taking upward of 30 weeks. Some parts even take a full year to arrive.
It’s nice news for distributors, who can take advantage of this “shortage” and charge higher prices, but it’s not a good deal for OEMs — especially considering the importance of fast time to market in today’s need-it-now world.
Here’s a closer look at why there’s a shortage of certain components today and what your company can do about it:
The most painful part of developing with electronics is knowing your success is fleeting. Eventually, all parts must die, or at least fade away into irrelevance. But there’s something you can do about it. Obsolescence management can guide you through this difficult process.
The booming electronics market is obviously great news for all those involved in the industry, but some drawbacks are beginning to take shape in the form of electronic component shortages worldwide.