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Samsung Looking to Apple’s Supplier Base

by | N/A 2013 | 0 | 0

Samsung Electronics has overtaken Apple as the world’s largest smartphone maker. Stretched thin by its efforts, the company now is courting some of Apple’s parts suppliers, Reuters reports. Experts warn that Samsung’s plan could lead to higher costs, production bottlenecks, and disruptions of product launches for Apple as it prepares for expansion of its product portfolio, including a cheaper version of the iPhone intended for emerging markets.

Samsung and Apple comprised 100 percent of industry profits in January through March, according to Canaccord Genuity, an investment bank. Samsung’s in-house supply chain is one of its core strengths, and Samsung still sources about 80 percent of its components from these suppliers. However, its recent pushes into both cheaper- and higher-end areas of the marketplace have left the manufacturer looking elsewhere to ensure it is able to meet demand.

“Any disruption in even small parts that you wouldn’t think are really core__say, headphones__can affect product launches,” says Lee Sun-Tae, analyst at NH Investment and Securities. “Who wins access to the best performing components in class in large quantity [is] the key,” he says.

Manufacturing Recovery: For Men Only? 

The economic recovery and manufacturing resurgence do not seem to be affecting both genders equally, states the US News & World Report. Amy Klobuchar, US senator from Minnesota, revealed at a Senate hearing last week that women once comprised 32 percent of the manufacturing workforce, but that number is now 27 percent. Perhaps even more instructive is the discovery that, while the industry as a whole gained 530,000 jobs from February 2010 to April 2013, there were 28,000 fewer manufacturing jobs for women in the same period.

One potential issue is the stigma of manufacturing involving heavy, physical labor__a perception that may not line up with the current manufacturing landscape. “Historically, we’ve been viewed as the three Ds: dark, dirty, and dangerous,” says Jennifer McNelly, president of the Manufacturing Institute. However, many new manufacturing jobs are better described as requiring critical thinking instead of grunt work, she says.

Another factor may be that women do not receive enough science, technology, engineering, and math (STEM) training. While women earn the majority of bachelor’s degrees, they hold less than half of math and science degrees and less than 20 percent of engineering and computer science degrees, Klobuchar notes.

A Good Sign for European Auto Industry

A bit of good news for the European auto industry is that there are signs a five-and-a-half-year slump may be bottoming out, the Wall Street Journal reports. The number of new passenger car registrations, a proxy indicator of sales, rose 1.7 percent in April, the first increase since September 2011. Components suppliers also are reporting that orders are up and auto production has stabilized.

Europe’s automotive depression has been severe, with demand well below the natural replacement rate for automobiles. Factories have been running at below capacity for many months, and many experts predict significant recovery is at least a year away.

“Since the beginning of the year, production plans for manufacturers have been stable,” says Yann Delabrière, chief executive of Faurecia, a global automobile components supplier. “That doesn’t mean that the market is good, but it’s quite a positive sign for us.”

However, Stephen Odell, head of Ford’s European operations, is less optimistic. “We are hopeful that we can see signs of [a plateau] during the course of this year, but I’m not sure that we have seen it yet,” he says. “It’s tough to read at the moment.”

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