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Assembly Contracts Quarterly Report
Q4 2019
Celebrating 29 years of excellence
 
ACL factoryMay I take this opportunity to wish you a happy and prosperous New Year!

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.


Component Lead-Times & Brexit
ACL SM LineAs with last quarter component availability continued to look largely stable with some areas of improvement. Some mosfets remain on critical supply. Pricing remains relatively stable with only some shifts as a result of currency fluctuations. The end of the quarter saw some improvements but on average had little impact on the market.
Supply Chain & Manufacturing
Supply chain managementLast quarter marked the fastest contraction of the UKs PMI* in 7 years, posting at 47**. This quarter contracted further posting at 45.6 in December. This is sharp decline from earlier in the quarter where it posted at 49.1 in November. Slowing global demand and UK firms reducing their stockpile inventory is reportedly the main cause in the wake of Brexit clarity not improving.

*a measure of manufacturing sectors order book
**Anything below 50 denotes contraction and above denotes expansion
UK & Global Trends
ACL SM LineNow that the political gridlock that has plagued Britain for the last few years has been resolved, and is confirmed that the UK is leaving EU, this must be a seen as a positive. This has been reflected in the number of new manufacturing enquires we are receiving, and the value of Sterling against its peers.

Towards the end of the quarter Sterling's gains were erased somewhat as the risk of a no-deal Brexit resurfaced. Johnsons EU exit deal was passed which whilst fixing the EU departure date at January 31st it also includes a ban on any extension of post-Brexit negotiations past Dec 2020. As we enter this new year it appears some uncertainty has not yet left us.

Brexit, of course also remains the main impact on the single currency which benefitted from the Brexit deal, trading at a 2-month high against the Dollar. The announcement by the ECB at the end of Q3 regarding monetary easing as it looks towards increased growth of the Eurozone has also aided strengthening against the Dollar. Slowdown of the German economy has given the Euro some knockbacks as has the weakening of global demand.

USD held strong at the end of the quarter as the economy entered its longest expansion in history by maintaining a moderate pace of growth. The halt on declines for the Dollar remained at the end of the year following positive manufacturing data, marking over 2 weeks with no decline.

In order to avoid a cycle of booms and busts China will not be increasing stimulus which will result in growth posing below recent rates.
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...
" It really was a pleasure to visit the company, and the audit confirmed that you have implemented a very robust and effective system "
" Tank you all very much for all the hard work you have put into enabling us to order these boards again. I greatly appreciate it. "
" I remain so wonderfully impressed by the solid working relationship that has developed between our companies and how nicely proactive and responsive you all are for us. "
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