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Sr. Cota
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re: EMS industry at the crossroads?
Sr. Cota   10/24/2012 6:48:05 PM
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Hello Junko, Sony has not left manufacturing business, it has its own manufacturing facilities as well as it is using EMS companies. In general, amount of outsourced LCD TVs, for all OEMs, is about 30%-35%, rest is in-house manufacturing.

junko.yoshida
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Blogger
re: EMS industry at the crossroads?
junko.yoshida   7/20/2012 6:12:09 PM
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Ah, that does make sense. Thanks, DrQuine.

DrQuine
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CEO
re: EMS industry at the crossroads?
DrQuine   7/20/2012 2:18:59 AM
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One explanation for the low margins received by manufacturers is that they enjoy very high multipliers (high volume sales) with very low investments in R&D. If a vendor gets greedy and asks for high margins, the manufacturing business will go to the next manufacturer on the list. As household names in electronics keep going out of business, the relative security of high volume manufacturing becomes increasingly appealing as a business model for high quality nimble companies.

junko.yoshida
User Rank
Blogger
re: EMS industry at the crossroads?
junko.yoshida   7/19/2012 6:09:10 PM
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This is really a good article. I do, however, have a question. The author notes that the trajectory of the consumer market will be ultimately a shift back to the OEM/ODM model. I don't quite get that. Every consumer electronics manufacturer I know has already left the manufacturing business -- mostly. Sony, Panasonic, JVC included. So, how will those CE vendors come back and tell the EMS guys, "We will take it from here"? But if the issue the author raises is about the EMS going up the value chain, I see that it's already happening. Look no further than the deal Foxconn made with Sharp.



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