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EMS - Production Delays & Higher Costs Driven by Component Shortages

The electronics industry on a worldwide basis sees no immediate end to component shortages and most manufacturers expect these problems to continue through 2022.

Global surveys find that electronics manufacturers continued to be slowed by the global shortage in semiconductors and related components / materials, causing production delays, and increased costs. Like most other industries, EMS companies continue to face significant challenges in hiring and retention of skilled talent.

Supply shortages, logistic delays, and other dislocations are impacting every facet of the electronics supply chain and the industries these manufacturers serve. Strong demand is facilitating sales, but shortages are delaying shipments and increasing backlogs. Limited material supply is driving higher prices on a worldwide basis.

Shortages are leading to increased lead times and months-long production delays, and are not expected to improve before the 2nd half of 2022. Manufacturers are forced to pay increased prices to suppliers for components due to shortages.

Global inventories continue to decline, backlogs continue to increase.

To relieve the workforce gaps, manufacturers are increasing wages, and upskilling works to defend hiring and retention issues.

Optima Technology is a global provider of PCBs, PCB Assemblies, Cables and System Assemblies located in Lewisberry, PA and New Delhi, India. Since 1995, Optima has specialized in providing local support coupled with cost-effective pricing via offshore manufacturing through our ISO approved facilities. Please reach out to optima@optimatech.net if you’d like to discuss further your PCB or Electronic Assembly needs.

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