ACL Contract Electronics Manufacture

Innovation . Design . Manufacture

Celebrating 26 years of excellence

Welcome to the Assembly Contracts Quarterly Report

With this we aim to inform our industry colleagues of any relevant news, component lead time updates and market conditions that may affect the manufacture of your product, or the electronics industry as a whole.
With ACL, Manchester, as your partner you receive unsurpassed manufacturing quality, delivered on time every time by our IPC trained & experienced workforce.

Our sophisticated, bespoke, written in-house, purchasing, QA, and production control software is continuously modified in response to market changes.

Materials are always purchased and products are manufactured well in advance of delivery dates, giving you peace of mind.
I hope you find the following informative. Please feel free to get in touch if you have any questions or comments.

ACL News

Our website has now been updated with latest testimonials and QA Audit reports from approval bodies.
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May we please take this opportunity to say Congratulations to our Bid Manager Jessica England on completing the Great North Swim which comprising of a cold 2 mile swim across Lake Windermere. With the help of ACL, her colleagues and friends Jessica has raised over £3,500 for The Christie and Camphill Village Trust.

Supply Chain & Manufacturing

This quarter has seen some price changes as a result of the USD's increasing strength. Further increases are predicted but with some gains having been made on the USD these may only be minor. Lead-times have generally remained stable. Raw material pricing continues to decrease, which is mainly due to lack of demand rather than currency valuations.

UK manufacturing has struggled this quarter with reports that in April output hit a seven-month low with PMI reading 51.8. Although May reported higher at 52 and despite this still indicating expansion this was a lot weaker than analysts expected. The CBI has pinned this on the stronger pound and the uncertainty caused by Greece. As the strength of the pound against the Euro offsets the improvements in the Eurozone by diluting sales and margins for exports to the Eurozone, concerns about Greece over the potential to hit Eurozone economic activity has not been without its effects on the UK.

UK employment is on the up again this quarter but jobs growth has slowed down. Wages grew by 2.7pc hitting a near four-year high prompting predictions of early interest rate rises.

Chinese manufacturing continued to contract this quarter. Despite recording its highest PMI in three months at 49.6, it is still below the point of breaking even. This is a blow to the economic powerhouse as the figures show slow growth despite measures to improve. There have been three interest rate cuts since November as well as measures to boost bank lending and the housing market but still there is acceleration in job cuts and economic contraction. The suggestion is that the second half of the year will see authorities step up their efforts to stimulate growth and job creation.

UK & Global Trends

The UK economy last quarter grew by 0.3pc marking a slowdown from the 0.6pc in the final quarter of 2014. As a result the CBI has downgraded its forecasts on UK growth from 2.7 to 2.4pc this year. Although the first quarter was weaker than expected it suggests it is a 'temporary blip' and that the UK should see more growth throughout the rest of the year but did warn that, along with the situation in Greece, the in/out referendum on the UKs EU membership poses a threat to the UKs recovery.

Despite a rocky but resilient start as a result of election jitters, GBP has remained strong against the majors this quarter, currently at close to an 8 year high against the Euro. Following the unpredicted majority win for the Conservatives, demand for the pound grew as markets, who love consistency, saw the likely continuation of austerity measures as a positive, leading to the biggest jump in Sterling since 2009.

USD has showed continuing strength this quarter but GBP did make gains on the dollar as investors brought forward rate hike expectations and pushed back their estimations over the Fed's tightening. British wages printed considerably higher than expected allowing further gains to be made taking the GBP/USD rate to its highest in seven months this week.

The Eurozone has fared slightly better than the UK in terms of growth, reaching a ten-month high, but was still below expectations.

Whatever happens now in Greece, damage has been done to both the Eurozone and UK economies. We can only wait and see the extent of the effect.

Please find enclosed ACL's brochure together with a component pricing and lead time breakdown.

If you would like to discuss any manufacturing requirements please don't hesitate to get in touch with me.
Arthur Woode
© ACL 2015