© Sellectronics
Our Managing Director, Jon Hurrell, joined BBC Radio 4 to discuss the growing pressure on electronic component supply chains and what it means for manufacturers across the UK.
Jon explained how surging global demand for AI infrastructure is having a knock-on effect far beyond the tech sector. Dynamic Random Access Memory (DRAM) prices have risen by 400% over the past two years, according to JP Morgan, as data centres are built at record pace. That demand is pulling raw materials away from other industries, including electronics, gaming, consumer devices, and defence.
As an aerospace and defence electronics subcontractor manufacturing circuit boards for radar and surveillance systems, we’re feeling this pressure directly through longer lead times and rising costs.
“It’s a combination of both. The lack of supply is obviously driving up costs. Data centres are being put up very rapidly by the AI companies, and that’s driving a lot of demand for those components and raw materials. That has a knock-on effect to the rest of the industries and is pushing lead times out as far as 50 weeks at the moment.”
— Jon Hurrell, Managing Director, Sellectronics
Jon also flagged the pressure on bare printed circuit boards, where a large share of the laminates and resins we rely on are sourced from around the Strait of Hormuz and Saudi Arabia. Disruption in that region is pushing prices up by around 5% a week.
To help our customers manage the impact, we’re encouraging longer-term forecasting. Orders placed around six months out allow us to secure materials early and protect production schedules, even where exact requirements aren’t yet confirmed.
Government and industry are exploring alternative supply routes and more local infrastructure across Europe, but these are long-term solutions. We expect current pressures on lead times and pricing to continue for at least the next year.
Planning ahead is the best way to stay protected from rising costs and extended lead times. Get in touch with our team to discuss your upcoming production requirements.
Listen to the interview here: