Electronic Manufacturing Services in Finland

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Electronic manufacturing services in Finland This CBI fact sheet aims to introduce electronic manufacturing service (EMS) providers from developing countries (DCs) to the electronic manufacturing service market in Finland. It is a medium-sized market in the EU; Finnish production accounted for about 5-10% of total EU EMS production in 2008. The best trade channel for DC exporters is to partner with local EMS providers. Market characteristics - EMS ã 1 ã ã ã ã ã Finland is a small market fo
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    Electronicmanufacturingservices in Finland This CBI fact sheet aims to introduce electronicmanufacturing service (EMS) providers from developingcountries (DCs) to the electronic manufacturing servicemarket in Finland. It is a medium-sized market in the EU;Finnish production accounted for about 5-10% of total EUEMS production in 2008. The best trade channel for DCexporters is to partner with local EMS providers. Market characteristics - EMS 1   ã Finland is a small market for electronic assemblies in the EU. It is thesixteenth largest, behind Austria and Ireland, but ahead of Portugal andEstonia. Apparent demand in 2010 totalled €1.1 billion, after an annualdecline of 19% in the period 2007-2010. ã Finland is a small producer of electronic assemblies in the EU. It is thethirteenth largest, behind Denmark, but ahead of Spain and Romania.Production in 2010 totalled €968 million, after an annual decline of 11% in theperiod 2007-2010. ã Finland accounted for 5.0-10% of EU EMS production in 2008, or equivalentto around €1.5-3.0 billion of industry turnover. Historically, EMS production inFinland has been highly dependent on the outsourcing strategy of thecountry’s leading electronic equipment producer, Nokia. However, since2009, when Nokia reduced the subcontracting activities to EMS providers, therole of Nokia in Finnish EMS production has been limited. ã As a result of the presence of Nokia in the country, a major competence of the domestic EMS industry is communication electronics. This dependencyon Nokia was also a major reason for Elcoteq’s (Finland’s largest EMSprovider) bankruptcy in October 2011, as Nokia switched to cheaper Asiansuppliers a few years ago. Even though the Nokia sales show a massivedecline, Finland is still known for a free climate for technical innovation, asNokia used to both lead and swallow up technical innovation. ã Communication electronics remain important in the Finnish EMS industry.Other competences of the Finnish EMS providers lie in industrial automation,measuring equipment and medical electronics. EMS in Finland can now bebest characterised by low volume high mix production. ã Finland is home to several large and medium-sized EMS providers. Foreignmultinational providers operating in the country include Partnertech (complexmechatronic systems), Foxconn (computer, communication and consumer electronics), Flextronics (industrial, aerospace, medical and industrial),Sanmina-SCI (communications, computer, automotive, medical and defence)and Enics (industrial and medical). In addition, it is home to Scanfil(communications; ranks 38 th in the world), Incap (equipment in energy 1 Electronic assemblies are used as an indication for EMS.   Electronic manufacturing services in Finland Source: CBI Market Information Database - www.cbi.eu ã Contact: marketinfo@cbi.euã www.cbi.eu/disclaimer ã Publication date: 09.12.2011 ã Compiled for CBI by Facts Figures Future incollaboration with Mr. Guenther P. Fandrich. efficiency; ranks 8 th in Scandinavia), Darekon (medical and industrialelectronics; has a facility in Poland) and PKC Group (medical and industrial). ã Relocation to lower cost countries has been an important on-going trend inFinland where the phenomenon is known as ‘Chinese syndrome’. Notsurprisingly, Asia is an important location, chosen by Nokia, Incap, Perlosand Aspocomp, to name but a few. The on-going price war in some marketsegments (mainly communication electronics) has been the main driver of production relocation. In addition to Asia, another important destination of electronics high volume low mix production is the Baltic region. ã As a result of large drops in imports of electronic assemblies in 2007 and2009 (-47% and -31% respectively), in the period 2006-2010 imports declinedby 18% per year, which was a higher decline than the development in the EUon average. The year 2010 was marked by high growth (26%) and importsamounted to €300 million in that year. ã Imports from developing countries (DCs) totalled €56 million in 2010. Theydropped faster than total imports in the period under review, thus the sharedeclined (from 36 to 19%). ã China accounted for 94% of all imports coming from DCs. China was followedby Thailand (2.5%), Croatia (1.0%), India (0.7%), Malaysia (0.5%), Mexico(0.3%), Brazil (0.2%) and the Philippines (0.2%). Of the main DC suppliers,only Croatia experienced growth (+82% per year). ã Labour costs for electronic assembly activities in Finland are among thehighest in the EU. Market characteristics - electronics ã The Finnish electronic equipment market is the fifteenth largest in Europe.Demand in 2009 totalled €72 billion (ZVEI, 2010). The market declinedsharply (by 16%) in 2009. The market started to recover slowly in the secondhalf of 2010 (2010 on average demand declined by about 2%) and isexpected to keep growing slightly in 2011 and 2012.   ã Electronics is regarded as a key driver of the Finnish economy due to itssignificant contribution to the country’s industrial exports. Finland is animportant producer of communication electronics, including digitaltransmission systems, exchangers, mobile phones, subsets, amplifiers andantennas. ã Beside Nokia, a leading supplier of communication technology and one of thelargest EU’s electronics group, Finland is also home to electronic equipmentproducers from other sectors. They not only represent key buyers of EMS,but are also main investors in technology. Examples are Datex Ohmeda(medical) and Vaisala (measure electronics). Other examples of maincompanies that make use of EMS services are ABB, Kone, Metso, RAY, TeSwitch and Vacon. All these companies need EMS for the industrialelectronics segment. ã In contrast to production activities, Finnish electronics and technologycompanies are increasingly concentrating their R&D activities in Finland. Thecountry has a strong base of highly specialised technological institutions,which are strongly connected to electronics companies. The industry investsa lot in R&D, with a current focus on nanotechnology.   For more information on buyer requirements, trends, trade structure and prices,please refer to the modules concerning the EMS market in general. Trade channels and finding trading partners The best prospects for DC EMS providers are Finnish EMS providers thatsubcontract some of their production activities, because it does not fit in with their other EMS activities. Reasons for subcontracting can be the volume or the type of   Electronic manufacturing services in Finland Source: CBI Market Information Database - www.cbi.eu ã Contact: marketinfo@cbi.euã www.cbi.eu/disclaimer ã Publication date: 09.12.2011 ã Compiled for CBI by Facts Figures Future incollaboration with Mr. Guenther P. Fandrich. product. DC EMS providers should explore which Finnish EMS providers don'thave a global manufacturing strategy yet, since these companies may still belooking for cooperation partners. The best way to approach them is visit or participate at trade fairs in Finland, or at the EU’s leading electronics fair Electronica (http://www.electronica.de), which is held in Munich, Germany everyeven year (November). The Internet is a valuable source to find prospects. Usefulwebsites are: ã Alihankinta -http://www.alihankinta.fi- subcontracting fair, including EMS.Select English language, go to ‘Exhibitors 2012’, select ‘Product Groups’,and look at the electronic section. Held in in Tampere annually in September. ã Association of Suppliers of Electronic Components and Measuring Equipment-http://www.elkomit.fi- go to ‘Jäsenet’ for a list of members. ã Finnish Foreign Trade Agents’ Federation -http://www.agenttiliitto.fi-association of commercial agents, importers and distributors. Choose theEnglish version and click on ‘Partners’ to find companies by product groups. ã Luettelomedia -http://www.luettelomedia.fi- Finnish company directory;search with ‘Electronics and components’. ã Sopimusvalmistus -http://www.expomark.fi- subcontracting fair, includingEMS, held in Oulu every even year (May). ã Subcontractor -http://www.easyfairs.com- manufacturing trade fair, includingthe IT sector, held in Helsinki yearly (March). ã Tekniikka -http://www.jklpaviljonki.fi/tekniikka2010- fair for automation andproduction technology, held in Jyväskylä every even year (October). Interesting players Finland hosts several EMS providers. Examples are: ã Aspocomp -http://www.aspocomp.com- EMS provider that produces HDI,RF applications, metal-back heatsink PCBs. ã Enics -http://www.enics.com- EMS provider, headquartered in Switzerland. ã Incap -http://www.incap.fi- EMS provider. ã Mariachi -http://www.mariachi.fi- EMS provider that is specialised in medicalelectronics. ã Mitron -http://www.mitron.fi- designs and produces electronics for information and security systems in transport. ã MLB -http://www.mlb.fi- EMS provider. ã PKC -http://www.pkcgroup.com- EMS provider. ã Scanfil -http://www.scanfilems.fi/eng- EMS provider. ã Sirico -http://www.sirico.fi- EMS provider. Other useful sources ã Doing business in Finland -http://www.kwintessential.co.uk/resources/global-etiquette/finland-country-profile.html. ã EETimes -http://www.electronics-eetimes.com- monthly electronicsmagazine, European edition. ã Federation of Finnish Technology Industries -http://www.teknologiateollisuus.fi- provides useful market information on theelectronics and other technological sectors. ã Finnpartnership -http://www.finnpartnership.com- promotes trade with DCs.Register for free to use their matchmaking service. Also publishes informationon exporting to Finland. ã Prosessori -http://www.prosessori.fi- monthly online electronics magazine. ã Tekniikka & Talous -http://www.tekniikkatalous.fi- weekly technology andeconomy magazine.
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