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Assembly Contracts Quarterly Report
Q1 2019
Celebrating 29 years of excellence
 
ACL factory In this report we aim to inform our industry colleagues of any relevant news, component lead-time updates and market conditions that may affect the electronics industry as a whole and particularly, the making of your product.

I hope you find the following informative. Please feel free to get in touch if you have any questions or comments.
 
ACL News
We are pleased to report that ACL has now gain this additional approval: EN IEC 60079-0:2018 - Explosive Atmospheres. Equipment. Requirements
Component Lead-Times
ACL SM LineQuarter 1 saw improvements to the component lead time situation.

The general theme is stabilisation but it is worth noting that despite this lead times are still generally quite high.

Distributors predict the situation is likely to remain the same for at least the next quarter.
Supply Chain & Manufacturing
Supply chain managementThe supply chain situation appeared to be easing and normalizing this quarter across a number of lines. Various LED products remain on allocation and some Xilinx programmable logic have suffered lead time extensions but generally other components appear more stable. Pricing is also stabilising with the only main increase being seen to NXPs MCUs.

UK Manufacturing data had a strong end to the quarter with PMI recording at 55.1*. Not only does this indicate expansion but also a marked improvement on the previous quarters closing of 54.2. The number is also well above earlier in the quarter which recorded at 51.2.

*anything below 50 denotes contraction and above indicates expansion.
UK & Global Trends
ACL SM LineThere is no escaping the main focus of this quarter has been the labyrinth that is the Brexit negotiations. The impact the ups and downs of the news has had a daily impact on the strength of GBP and the UK economy. Despite the expectation that the sharp fall in sterling value following the referendum would help boost net exports the balance of payments deficit deteriorated towards the end of last quarter. Brexit uncertainty has made overseas customer reluctant to source from Britain. The economy, however, did see a growth of 0.2 pc in the fourth quarter and growth for the year was revised from 1.3 to 1.4 pc. Sterling, despite remaining incredibly vulnerable, had a generally strong quarter overall with some of its strongest highs for some time. At the end of February, it experienced 22-month highs.

The UKs strong manufacturing PMI at the end of the quarter was in keeping with the theme of a strengthening to the market and GBP USD got a real boost. If the outcome is a no-deal Brexit GBP will fall hard.

US data at the end of the 4th quarter was lower than expected at 2.2pc but USD remains strong overall putting pressure on the single currency and other commodity currencies.

The Eurozone struggled this quarter with Germany and Switzerland Manufacturing PMIs disappointing. Germany's to 44.1* indicating the fastest contraction in 6.5 years and Switzerland's, whilst not indicating contraction, did record lower than expected at 50.3. Eurozone CPI also slipped to 0.8pc in March compared to 1.0 pcs in February. Amongst other things, uncertainty over Brexit is weighing heavily on all.
Please find enclosed ACL's brochure together with a component pricing and lead time breakdown

With ACL, Manchester, as your partner you receive unsurpassed manufacturing quality, delivered on time every time by our IPC trained & experienced workforce.

We offer a 3-Year workmanship warranty as standard.

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

Arthur Woode
Director
What our clients say about us...
" We think ACL's systems are second to none. Not one of our suppliers - ever, have been able to match up to your traceability etc. "
" I would like to take this opportunity to thank everyone at ACL for all the hard work and support you have provided over the past twelve months. It has been a pleasure dealing with you and long may it continue. "
" Developing our partnership with ACL has enabled us to significantly streamline our business and focus on our core competencies. "
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