The UK Electronic Manufacturing
Services Industry 2011-2016
The UK EMS Industry 2011-2016
THE UK ELECTRONIC MANUFCATURING
SERVICES INDUSTRY 2011-2016
Published: December 2012
Research Consultant: Andrew Fletcher
The following report provides a strategic overview of the UK EMS industry and in addition to original research has
also extracted data from Reed Electronics Research’s reports the European Electronic Manufacturing Services
Industry 2011-2016, the Yearbook of World Electronics Data and European Electronics Markets Forecast. For
further information on Reed Electronics Research’s complete range of reports please visit www.rer.co.uk or
contact [email protected]
© Reed Electronics Research, England 2012
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in
any form or by any means, electronic, mechanical, photo-copying, recording or otherwise, without prior consent
of the copyright owner.
Whilst every care is taken to ensure that the data published in this report are accurate, the Publishers cannot
accept responsibility for any omissions or inaccuracies appearing or for any consequences arising therefrom.
Reed Electronics Research
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United Kingdom
Tel: +44 (0) 1235 227310
Fax: +44 (0) 1235 420515
Website: www.rer.co.uk
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The UK EMS Industry 2011-2016
Contents
1 Executive summary
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2 The UK EMS Industry
2.1 European Market Overview
2.2 UK EMS Market Overview
2.2.1 UK Economic Outlook
2.2.2 EMS Market Forecast
2.3 UK EMS Market Segmentation
2.3.1 Electronics Industry Overview
2.3.2 Automotive
2.3.3 Aerospace & Defence
2.3.4 Medical
2.3.5 Communications & Networks
2.3.6 Control & Instrumentation
2.3.7 Computing
2.3.8 Consumer
2.3.9 Energy
2.3.10Industrial
2.4 The Key Drivers of the UK EMS Industry
2.4.1 The Financial Pressures on EMS and OEM
2.4.2 The Benefits of UK Manufacturing
2.4.3 The Rate of Outsourcing
2.4.4 Proximity to the OEM
2.4.5 Unit Cost versus Total Cost
2.4.6 Investment
2.4.7 Manufacturing Trends
2.4.8 Flexibility in Manufacture, Supply and Service
2.4.9 Relationship Management with the OEM and Suppliers
2.4.10 Addressing the Issue of Price
2.4.11 Providing more Services to the OEM
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3 Structure of the UK EMS Industry
3.1 Overview
3.2 Global “Group 1” EMS Companies
3.3 Leading UK EMS providers
3.4 Industry Consolidation
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4 Profiles of the Major UK EMS providers
4.1 Asteelflash Bedford
4.2 AWS Electronics
4.3 Axiom Manufacturing Services
4.3 Axis Electronics
4.5 Briton EMS
4.6 Chemigraphic
4.7 Connor Solutions
4.8 Custom Interconnect
4.9 Dynamic EMS
4.10 Elite Electronic Systems
4.11 eXception EMS
4.12 Ferranti Technologies
4.13 Foundation Technology
4.14 Hansatech EMS
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27
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The UK EMS Industry 2011-2016
4.15 Jabil Circuit
4.16 Jaltek
4.17 JJS Electronics
4.18 PartnerTech
4.19 Pektron
4.20 Plexus
4.21 SMS Electronics
4.22 Speedboard Assembly Services
4.23 Stadium Electronics
4.24 Surface Technology International
4.25 Syntech Technologies
4.26 Tioga
4.27 TT electronics
4.28 Ultra Electronics CEMS
4.29 Walters Group
4.30 Wilson Process Systems
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5 Directory of UK EMS Manufacturing Locations
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Tables
Table 2.1 EMS Revenues for Western Europe and CEE & Other 2011-2016
Table 2.2 UK’s Leading Economic Indicators
Table 2.3 UK EMS Revenues 2011-2016
Table 2.4 Summary of UK Electronics Production 2007-2015
Table 2.5 UK Passenger Car and Commercial Vehicle Manufacturing 1997-2015
Table 2.6 UK Medical Electronics Production 1997-2015
Table 2.7 UK Control & Instrumentation Production 1997-2015
Table 3.1 The Top 25 UK EMS Manufacturers 2011
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Figures
Figure 1.1 UK EMS Revenues 2011-2016
Figure 2.1 EMS Revenues for Western Europe and CEE & other 2011-2016
Figure 2.2 Total European EMS Revenues by Market Sector 2011-2016
Figure 2.3 UK GDP Growth 2009-2014
Figure 2.4 UK EMS Revenues 2011-2016
Figure 2.5 UK Electronics Production 2010-2015
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5
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9
10
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The UK EMS Industry 2011-2016
7000
6000
£ Millions
5000
4000
3000
2000
1000
0
2010
Computing
2011
Industrial
2012
Communications
2013
2014
Consumer
2015
Components
Figure 2.5 UK Electronics Production 2010-2015
2.3.2 Automotive
Despite the current economic climate car manufacturing in the UK was up 6.7% in October 2012 and for the first
ten months of the year by 9.7% at 137,028 and 1.22 million, respectively. Commercial vehicle manufacturing also
increased in October by 5.0% to 11,899 units but was down by 6.1% for the first 10 months of the year at 94,214.
Sustained investment in R&D, manufacturing and new products has bolstered the UK automotive industry and
enabled it to turnaround following the sharp downturn in 2008/2009, although car production is still lower than the
pre-recession level of 1.54 million in 2007.
Table 2.5 UK Passenger Car and Commercial Vehicle Manufacturing 1997-2015
Units (000s)
2007
2008
2009
2010
2011
2012*
2013*
2014*
2015*
Cars
Commercial Vehicles
Total
1535
216
1751
1447
203
1650
999
91
1090
1270
123
1393
1343
120
1463
1459
103
1562
1490
75
1565
1565
70
1635
1645
70
1715
Source: OICA, SMMT, * forecast Reed Electronics Research
Strong investment over the last 18-24 months, including GM, BMW, Nissan and Toyota, should be the basis for
further growth in output over the next few years although this is contingent on Eurozone stability. Exports
accounted for 84% of production in 2011 with approximately 40% of this outside of Europe.
Although the component and systems sector is expected to benefit from the positive outlook for the UK, in 2012
and 2013 the slowdown in car production in Western Europe, on the back of deteriorating sales will reduce
demand. Increasing electronics content, driven in part by legislation and the need to meet tighter emission and
safety standards, will help offset to some extent lower production as will the migration of electronic systems into
the volume segments of the market.
Although the move to electric vehicles is expected to provide significant opportunities, the roll-out of the required
infrastructure to support their wider adoption is currently being stalled by the current cut in government spending.
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The UK EMS Industry 2011-2016
2.4.2 The Benefits of UK Manufacturing

The move to outsource manufacturing to low cost locations has been one of the major trends in the UK
electronics industry resulting in the demise of the majority of volume manufacturing. With companies
increasingly looking to move medium, and even in some cases low, volume production offshore the
actual future of UK manufacturing has come under increasing question. In reality, manufacturing in the
UK will continue to offer benefits to both the EMS and OEM.

Benefits of manufacturing in the UK include lower logistical costs, the introduction of beneficial tax
incentives by the government to support local manufacturing, higher quality and technical support,
shorter lead times, the flexibility to quickly react to changes in customer demands and more secure
intellectual property. The actual cost of manufacturing offshore is also rising in response to higher
wages, China has introduced a minimum wage, and it is expected that other countries including India,
Thailand and Vietnam will follow suit.

Where a low cost solution is required OEM’s can benefit from UK NPI and industrialisation before
transferring production offshore either to the EMS companies own plant or to manufacturing partners
where production is controlled and monitored by the EMS.

It is worth noting that the option to offer low cost manufacturing through their own facilities is offered by
a relatively few UK EMS providers. Of the top 25 companies analysed in the report only 10 have their
own low cost plants and of these four are foreign owned companies with manufacturing across multiple
locations and countries.

The focus on utilising low cost manufacturing in Europe has been adopted by a number of companies.
Regionalisation may not bring all the cost benefits of manufacture in Asia or a very low cost region
elsewhere, but there is some realisation and acceptance that it is the ‘total cost of supply’ that is
important to both the OEM and the EMS. Having remote manufacture takes time and if there are
problems, engineers and managers need to board a plane and spend significant time resolving the
problem. Whilst inevitably problems will still occur, it is easier solving them at a location 2-3 hours flight
away and in a similar culture, rather than halfway around the world.
2.4.3 The Rate of Outsourcing

EMS are becoming the experts in electronic manufacturing, especially in the area of fast line changes to
accommodate the high mix/low volume product series which make up the vast majority of their total
production.

Although there are expected to be still further opportunities for outsourcing electronic production from
OEM’s there will come a time, perhaps in a few years when this rate of outsourcing will slow.
2.4.4 Proximity to the OEM

Most EMS agree that being physically close to the customer, especially sharing a common language
and culture, can be very beneficial in the design and pre-production phases resulting in shortening the
new product introduction time. There may be other occasions when being physically close, can help
resolve unseen problems quickly.

However, sometimes the customer can take the decision to manage the project from thousands of miles
away if the total project cost allows frequent visits. In other words, if the relationship is a long standing
one and there is good communication from both sides then physical proximity is not a requirement.
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The UK EMS Industry 2011-2016
3 Structure of the UK EMS Industry
3.1 Overview
With the Group 1 companies now effectively serving the UK from offshore facilities in terms of actual
manufacturing, the UK EMS sector is structured around a large number of small to medium sized companies,
with only one company, ACW, ranked within the Top 50 European EMS providers in Europe in 2011.
UK companies are focused on high mix, low volume production in the medical, aerospace & defence, control,
instrumentation, industrial, automotive, other transportation and energy sectors. Although there a number of
companies with multiple locations or subsidiaries the majority of UK EMS providers operate through a single
manufacturing site with the majority privately or family owned.
Only a small number of UK companies have established their own low-cost manufacturing facilities. The use of
manufacturing partners in either the Far East or Central and Eastern Europe has allowed a wider number of UK
EMS companies to offer access to low-cost production although the manufacturing process is closely controlled
from the UK. Materials and component procurement from the Far East is also a growing trend as companies
looking to reduce costs within their UK manufacturing operations.
A small number of European EMS providers have entered the UK EMS market through acquisition including the
Swedish companies PartnerTech (Hansatech Group September 2006) and NOTE (Proqual January 2008) and
the French company Asteelflash (MRP Electronics January 2008). US-based Plexus, which is one of the world’s
leading EMS providers, has had a manufacturing presence in the UK since 2000 following the acquisition of the
Scottish company Keltek.
To date, UK companies have not looked to establish a West European manufacturing footprint to serve
customers on the continent although a few have established operations in the US.
Despite the difficult market conditions there have been relatively few bankruptcies within the UK EMS industry
although a prolonged downturn could see this figure rise. In the medium-term however, it is expected that there
will be an increase in the number of acquisitions, mergers or collaborations (see Section 3.5).
3.2 Global “Group 1” EMS Companies
Although the majority of the World’s leading EMS providers established manufacturing operations in the UK they
have since been scaled back or closed leaving only Jabil with a production facility in Scotland. Jabil itself has also
scaled back its presence in the UK closing its principal manufacturing in Ayr, Scotland in 2007 leaving the
company with three facilities in the UK a 130,000 sq ft manufacturing plant in Livingston, Scotland and two sites
focused on aftermarket services located in Ayr, Scotland and in Coventry, England.
Flextronics through its Global Services division has two major facilities in the UK located in Manchester and
Swindon. Services offered by the unit include distribution and supplier managed inventory; product transformation
including build/configure to order; service parts logistics and reverse logistics and repair.
Celestica re-entered the UK with the acquisition of the Scottish company Invec in 2010. Invec specialised in
warranty management, repair and parts management services.
Sanmina, which closed its EMS plant in Greenock, Scotland in 2006 and enclosures facility in Northern Ireland in
2007, has a small cable assembly plant in Port Glasgow, Scotland.
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The UK EMS Industry 2011-2016
4.3 Axiom Manufacturing Services
Located in South Wales, Axiom Manufacturing Services entered the contract electronics manufacturing market in
2000, after almost 20 years as a manufacturing subsidiary of the Japanese consumer electronics group Aiwa,
which had been acquired by fellow Japanese group Sony. In 2002 the EMS business, Aiwa Manufacturing
Wales, was sold to a Hong Kong Investment company which now operates as South Sea Petroleum Holdings
Ltd. In 2011, the company reported sales of £19.7 million and is targeting sales of between £23-24 million in
2012.
Manufacturing and field service operations occupy 100,000 sq ft of the company’s purpose-built factory in
Newbridge, Axiom providing a complete range of manufacturing services including surface mount and
conventional plated through hole PCB assembly, electro-mechanical assembly, test and worldwide logistics. The
company has focused on low- to medium-volume production and specialist services for the medical, defence,
aerospace, industrial, rail and maritime industries.
Axiom is accredited to the TS16949 and IPC-A-610C standards and has received a British Kitemark for the lead
free manufacture of PCBs. The company has also signed up to the Supply Chain for the Twenty First Century
(SC21) national aerospace and defence supply chain improvement programme
During 2010, the company added the latest Package-on-Package (PoP) assembly capabilities to its range of
high-tech PCB manufacturing solutions. To fully take advantage of the technology Axiom has refined the
placement method for stacking the components, investing in a state-of-the-art Fuji AIM SMT machine which can
place PoP components at a rate of eight seconds per device. The company has also invested in a DAGE 7600
XiDAT digital X-Ray inspection system.
In early 2010, Axiom launched a new prototyping service. The unit is being run as a separate business the
company investing in new equipment and software to ensure the unit is able to compete in the market.
In July 2011, headcount at the company had increased to 210 including around 17 people working on R&D with
the emphasis on making the manufacturing process quicker and more cost effective.
In July 2012, Axiom announced it had been awarded a major contract by a leading international defence
company. Revenue from the programme are expected to reach US$11 million over a 9-12 month period. The first
production is expected in the final quarter of 2012.
Axiom Leading Financial Indicators – Year End December
£ millions
2011
2010
2009
Sales
Net Profit/(Loss)
Net Assets
Average No of Employees
19.7
1.2
4.9
187
17.3
0.3
3.7
166
14.5
(1.1)
3.4
170
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The UK EMS Industry 2011-2016
5 Directory of UK EMS Manufacturing Locations
Company: Aaron Electronic Manufacturing Services
Address: Unit 6, Vulcan House, Restmor Way, Wallington, Surrey SM6 7AH, United Kingdom
Tel: +44 20 8669 0999
Fax: +44 20 8669 2400
Website: www.aemsonline.co.uk
Company: ABI Electronics Ltd
Address: Dodworth Business Park, Barnsley S75 3SP, United Kingdom
Tel: +44 1226 207420
Fax: +44 1226 207620
Website: www.abielectronics.co.uk
Company: Aclet Electronics Ltd
Address: Unit 34, Northfield Way, Aycliffe Business Park, Newton AycliffeCo. Durham DL5 6UF, United Kingdom
Tel: +44 1325 307429
Fax: +44 1325 317321
Website: www.aclet.co.uk
Company: Active-PCB Solutions Ltd
Address: Unit 4 Acre road, Reading, Berkshire RG2 0SU, United Kingdom
Tel: +44 118 931 0292
Website: www.active-pcb.com
Company: AEI Electronics Group
Address: Unit 33, Mitchell Point, Ensign Point, Hamble, Southampton SO31 4RF, United Kingdom
Tel: +44 23 8045 5411
Fax: +44 23 8045 5022
Website: www.contractelectronicmanufacturer.com
Company: A-FAB Electronics
Address: Unit 104, The Commercial Centre, Picket Place, AndoverHants SP11 6RU, United Kingdom
Tel: +44 1264 351323
Website: www.a-fab.co.uk
Company: AGS Electronics Ltd
Address: Units M, Pitreavie Crescent, Pitreavie Business Park, Dunfermline, Fife KY11 8UP, United Kingdom
Tel: +44 1383 624846
Fax: +44 1383 625004
Website: www.ags-e.co.uk
Company: AGW Electronics Ltd
Address: Adelphi Way, Stavely, Derbyshire S43 3LS, United Kingdom
Tel: +44 1246 473086
Fax: +44 1246 280082
Website: www.agw.co.uk
Company: AIID Solutions Ltd
Address: Unit 8, Wyvern Avenue, Reddish, Stockport Cheshire SK5 7DU, United Kingdom
Tel: +44 161 480 3163
Website: www.aiid.co.uk
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