As 2022 draws to a close, we look back on the factors which have influenced the electronics sector throughout the year and as a result, how this has affected us here at MPE Electronics.
Knock-on effects of COVID-19 for PCB manufacturing
Despite a widespread vaccination programme, the COVID-19 crisis continued to have an effect on businesses generally, with the backlogs caused by the pandemic still creating delays in manufacturing to this day.
To compound the issue, the pending ban on the sale of all new petrol and diesel cars by 2040 has led to a huge boom in the electric vehicle industry, which has meant greater demand for the PCBs that play a significant role in their design, manufacture and running (as well as those required for the chargers which power the cars). While the added PCB demand is a good thing for PCB manufacturers, it has come with a downside, because it has added to the manufacturing delays caused by COVID-19.
The additional demand for PCB manufacturing has also led to labour shortages and the need for new factories to open to cater for the increase. And additional recruitment and expansion of premises, of course, takes time.
Global PCB manufacturing supply shortages
The Russia/Ukraine war and rising tensions between the US and China has created microchip and raw materials (for example, palladium and neon etc) supply shortages. The disruption to this engineering supply line has had far-reaching consequences and affected the availability of products, leading to a spike in costs and pricing across the industry spectrum.
As a result, PCB manufacturers looked to mitigate supply chain risks and rethink supply chain delocalisation. Now, many supply chains have been brought closer to home to avoid global disruptions and, by reducing their exposure to the risks involved, UK manufacturers and industries have become more resilient.
Cost of living increases
Huge rises in inflation and energy prices have led to a growing increase in the cost of electronics manufacturing in 2022, which is likely to rise further into 2023.
In response to this, companies have been looking to rely more on renewable energy to reduce costs. It is, however, a process that is likely to take many years due to the need for huge infrastructural changes and additional financing.
Legislative changes
In 2022 new legislation was brought about to boost the PCB manufacturing industry. This included the US CHIPS and Science Act and plans for the EU European Chip Act.
Large electronics manufacturers also became more involved in environmental, social and governance (ESG) reporting and have been reassessing their carbon footprints, environmental impacts and suppliers’ working conditions.
This is in preparation for more formal ESG reporting requirements coming into force in 2023, when ESG reporting in the UK will be further formalised through the Sustainability Disclosure Requirements (SDRs).
How events of 2022 affected MPE
In 2022 MPE Electronics became a member of the Reshoring UK, a unique collaboration of leading industrial engineering associations to assist manufacturers in connecting with trusted, accredited suppliers in the UK who are capable of delivering products and services that match their requirements. We are looking forward to working with companies looking to reshore their PCB assembly and full box-build requirements to the UK.
Like all other electronics manufacturers, we were unavoidably affected by the global component shortage but our excellent planning and strong supply chain framework ensured that our customers experienced minimal delays.
Since 2020 we have worked hard to strengthen our supply chain framework, cementing long-standing relationships, expanding our supplier base and increasing our stock levels. These steps brought welcome stability and security to our operations.
Robust planning and supply chain agility allowed us to minimise the impact of the rising prices and shortage of electronic components and other essential raw materials on our customers.
Coming up in 2023
Moving into the new year, we are very excited to consider new accreditations, invest in new technologies and expand our PCB manufacturing facilities, to better serve our customers.
To find out how MPE Electronics PCB manufacturing and assembly services can benefit your business, contact us on +44 (0)1825 764822 or enquiries@mpe-electronics.co.uk.
