mobile | classic
Dataweek Electronics & Communications Technology Magazine





Follow us on:
Follow us on Facebook Share via Twitter Share via LinkedIn


Search...

Electronics Buyers' Guide

Electronics Manufacturing & Production Handbook 2019


 

Ad Valorem excise duties - a blessing or a potential curse?
11 May 2011, Manufacturing / Production Technology, Hardware & Services, News

Job creation has become the key focus for our current administration and, if our astute journalists have it right, the life blood to the success or failure of such administration.

So other than giving the IDC nine billion Rand to distribute to existing organisations to grow or create sustainable employment, we can apply duties to products that can be made locally. A case in point: TV panels and potentially now monitors, attached to their enticing global brands and promise of ludicrous volumes. The industry is now abuzz and the loophole seems to have been closed by including certain monitors when applying the duty. So how will tariff code 8471 or 8528 without rebate 460.16/85.28 affect PCBA and ultimately job creation?

I think, first and foremost, we need to understand that margins will be dictated to the industry and not the other way around, and yes, the volumes should justify the subservient position we will have to adopt – as many of us have already experienced. As for our ‘dear federation,’ what strategic direction have they adopted to protect and consolidate our minor industry against the bullying might of the global power houses?

At the risk of sounding like promoting price fixing, surely we should have some open debate on what is sustainable and how we can ensure growth and not decline. To protect our local industry and historical client base, we must view this opportunity as new investment; to this end, how are we to ensure continuity without long-term forecasts or future orders to warrant the investments in both machinery and skills? It cannot be tackled to the detriment of local customers and their supply must be seen as additional as opposed to core, to meet this end. So I ask again what the industry is doing to position itself for battle against this ever increasing juxtaposition of immediate opportunity and potential future threat.

The answer, unfortunately, is nothing but fragmenting even further into weaker positions through panicked pricing that will prove to be parasitic to the core of the business, affecting not only the manufacturer but its client base. There are some manufacturers that have unfortunately already travelled this road without many options to return. Please understand that I am by no means looking at this as a negative move by government and I do believe that we as an industry have been handed a key to the global door, I just believe that we need to use it to open that door and not turn it the wrong way, thereby breaking it in the lock and leaving it permanently inaccessible.

What is the answer then? How then do we maximise this opportunity, to firstly create sanity in the form of agreeable margin, but secondly and more importantly to create societal wealth in the form of sustainable jobs and industry growth? It goes without saying that we manufacturers should be standing together – the volume requirements could swamp every machine available and still be short. Secondly, we should have some strategy on how to invest wisely as we are creating livelihoods, but primarily I must protect the 300 families who already rely on us and the existing customers that ensure such reliance. The only way forward, in my humble opinion, is a marriage between manufacturer and brand. Our vows would be to quality and investment in resources, skills and the standards they require, and their vows should be ones of time and commitment, nicely tied up in a prenuptial agreement that will ultimately protect the 300 families referred to above.

Our labour is organised, they have their bargaining council and main agreement dictating industry negotiated terms and ultimately protecting them. Maybe (and yes, this is said tongue in cheek) we should have our own main agreement with the global brands that ultimately will protect us.

Perhaps we can learn from one of the biggest global players, if not the biggest, Foxconn, a unit of Taiwan’s Hon Hai Precision Industry Co., the world’s largest contract electronics maker by revenue, who said in a statement recently that its net loss for the 12 months ended 31 December 2010 totalled $218,3 million, compared with a net profit of $38,6 million in the previous year. Revenue fell 8,2% to $6,63 billion from $7,21 billion a year earlier (source: The Wall Street Journal – digital network, business earnings.)

“We need to take decisive actions to conclude our capacity relocation, optimise our cost structure and return to profitability. We need to serve our existing customers better and approach more new customers,” Foxconn Chairman Samuel Chin said in one statement. The company earlier announced plans to move its main production base to Langfang, in northern China’s Hebei province, to mitigate rising labour costs.

If the giants of our industry in one of the most efficient and cost friendly operating environments in the world is struggling to supply the major brands profitably, we must make sure we are prepared when entering the ring to fight in what we all have to agree is way above our current weight division. As a final word of support to my fellow manufacturers, be strong in negotiation, be resolute on fairness but more importantly protect your resources, because the global heavyweights will utilise every last placement today with no promise of tomorrow.

For more information contact Jason Wilford, Microtronix, +27 (0)11 792 5322, jason@microtronix.co.za, www.microtronix.co.za


Credit(s)
Supplied By: Microtronix Manufacturing
Tel: +27 11 792 5322/3
Fax: 086 645 3955
Email: info@microtronix.co.za
www: www.microtronix.co.za
  Share on Facebook Share via Twitter Share via LinkedIn    

Further reading:

  • What can sport teach us about MRO procurement?
    28 August 2019, RS Components (SA), News
    Just like triathlon transitions, if you don?t respect the details and aren?t supportive about making manufacturing flexible, as a supplier you aren?t contributing to your customers? success.
  • AREI hosts industry for business breakfast
    28 August 2019, News
    Attendees of a business breakfast hosted by AREI (Association of Representatives for the Electronics Industry) on 24 July were treated to an inspirational talk by computer scientist and entrepreneur Stafford Masie.
  • Hybrid surface mounters
    28 August 2019, Zetech, Manufacturing / Production Technology, Hardware & Services
    Yamaha’s S10 and S20 i-Pulse 3D hybrid surface mounters, featuring enhanced support for MIDs (moulded interconnect devices), were developed under the concept of a single-unit manufacturing centre designed ...
  • Dual-syringe dispenser
    28 August 2019, Test & Rework Solutions, Manufacturing / Production Technology, Hardware & Services
    Techcon announced the release of its new 50 ml dual-syringe dispenser designed for hassle-free dispensing of 50 ml dual syringes. The system can accommodate conveniently packaged 50 ml side-by-side ...
  • Rugged Interconnect and Pentek further cement partnership
    31 July 2019, Rugged Interconnect Technologies, News
    In May this year, Rugged Interconnect Technologies hosted the co-founder and vice president of Pentek, Rodger Hosking, for a week-long visit to reinforce the two companies’ partnership in the South African market.
  • SA security manufacturers going strong
    31 July 2019, News
    Dataweek spoke to two of the leaders in the local market about what they do, what they’ve been up to, and what their plans are for the future.
  • The only constant is change
    31 July 2019, Microtronix Manufacturing, Manufacturing / Production Technology, Hardware & Services
    Blatant tender rigging and wholesale corruption poses one of the biggest threats to us achieving arguably the single most important and critical requirement in the revival and rejuvenation of our country’s prospects through job creation.
  • All in space is not rocket science
    31 July 2019, Elmatica, Manufacturing / Production Technology, Hardware & Services
    Elmatica, a Norwegian printed circuit board (PCB) broker that established an office in South Africa last year, has assisted a newcomer to the space satellite scene to put its satellites into space.
  • Laminates for 5G active antenna arrays
    31 July 2019, RF Design, Manufacturing / Production Technology, Hardware & Services
    Rogers Corporation has introduced UL 94 V-0 antenna-grade laminates manufactured with standard profile electro-deposited copper foil to meet present and future performance requirements in active antenna ...
  • Benchtop soldering robot
    31 July 2019, Testerion, Manufacturing / Production Technology, Hardware & Services
    Weller’s new WTBR 1000 benchtop robot aims to synergise precision, reliability and productivity of soldering tasks. It is equipped with Weller‘s high-performance ‘Technology Line’ soldering tools, ensuring ...
  • New 3D detector for X-ray system
    31 July 2019, MyKay Tronics, Manufacturing / Production Technology, Hardware & Services
    The X Line 3D Series 400, an inline X-ray system from Goepel Electronic, has a new detector option for high-resolution 3D X-ray inspection of electronic assemblies. The MultiAngle Detector 3 combines ...
  • Conformal coatings for challenging operating environments
    31 July 2019, Vepac Electronics, Manufacturing / Production Technology, Hardware & Services
    Modern electronic assemblies are increasingly expected to survive hostile operating environments and work reliably in conditions of prolonged high temperatures in the presence of thermal shock and high ...

 
 
         
Contact:
Technews Publishing (Pty) Ltd
1st Floor, Stabilitas House
265 Kent Ave, Randburg, 2194
South Africa
Publications by Technews
Dataweek Electronics & Communications Technology
Electronics Buyers’ Guide (EBG)

Hi-Tech Security Solutions
Hi-Tech Security Business Directory

Motion Control in Southern Africa
Motion Control Buyers’ Guide (MCBG)

South African Instrumentation & Control
South African Instrumentation & Control Buyers’ Guide (IBG)
Other
Terms & conditions of use, including privacy policy
PAIA Manual





 

         
    Classic | Mobile

Copyright © Technews Publishing (Pty) Ltd. All rights reserved.