Issue link: https://iconnect007.uberflip.com/i/1534385
With the new U.S. presidential administration in full swing, what are you most concerned about? How does this play into your business strategy? e primary concern is definitely tariffs. To prepare for potential new policies, we plan to build a new factory in Southeast Asia and are currently working on our facility in Malaysia. What if the Trump administration imposes additional tariffs on those countries? Production costs in Southeast Asia are at least 20% higher than China already. at is a con- cern and something we are monitoring. If that happens, board shops will have to nego- tiate with customers to decide whether those extra costs will be covered by the customer or whether it will simply create an even more cut- throat pricing environment and competition between suppliers. What is your organization doing to be proac- tive in this challenging global economy and for the benefit of your customers? e above uncertainty is a major factor in our multi-year planning, pushing us to diversify production locations. To remain competitive and help overseas customers mitigate their risks (e.g., tariffs, supply chain disruptions, and geopolitical tensions, including those in Japan and South Korea) setting up an addi- tional plant in ailand to shi more of our production capacity outside China will allow us to offer a real comprehensive solution, with higher layer counts, to support our clients and show less reliance on China. What is the most pressing issue for PCB manufacturers in this age of electronics manufacturing? e most pressing issue for PCB shops is surviving while choosing the right strategic path. Despite a slight increase in PCB prices due to recent year spikes in copper and gold costs, our bargain- ing power has been weak because of a surplus of boards prior to that. Gener- ally, board shops are constantly working to cut costs by redesigning products, substituting pre- cious metals without sacrificing quality, adopt- ing high automation, or applying AI in manufac- turing processes. is is easier for small factories with less diverse product lines, as they can con- trol costs and risks more effectively than mid- sized shops. We define mid-sized shops as those with annual turnovers of $150 to $450 million. ey lack the agility of small shops and the resources of large giants, leaving them squeezed in the middle. ey are more likely to struggle to sur- vive because they must simultaneously attract more customers, reduce costs, invest in tech- nology, and manage overseas factories. In China, a polarization is evident. Small shops thrive by specializing in niche industries, large shops grow through mergers and acquisitions and economies of scale, while mid-sized shops grapple with indecision over their direction. With fierce price-based competition and thin profit margins, stronger and more prof- itable board shops will consolidate over time, dropping the number of rivals. is mirrors the consolidation seen in fragmented markets like laptops or electric vehicles, which once had hundreds of brands. e polarization forces mid-sized shops to either scale up or special- ize, with few viable middle-ground options. Tom, thank you for your thoughtful answers. We look forward to learning more about both your factory in Malaysia and what you intend to build in Thailand. ank you, Marcy. PCB007 24 PCB007 MAGAZINE I APRIL 2025