Total cost of Ownership for PCBA’s
Recent 2021 figures released in the US suggest a significant number of OEM’s are considering reshoring.
This trend is being led by concerns around security, tariffs, hidden cost plus potential geopolitical disruption.
An example was used based on a PCBA, size 1” x 2” with a BoM cost of £17.71 with annual volumes of 250,000pces. This PCBA had 136 placements including several BGA’s.
The product was then benchmarked using current active bodies to obtain a comprehensive picture of what price would be expected both in the US & China – see below.
Total cost of ownership (TCO) calculates the cost of the product when all outsourcing costs are applied. TCO should always be considered when identifying and understanding the true total cost.
The figures shown above are subjective however we know labour costs within China are increasing and the cost of freight has climbed 6-fold in the last year.
Also exchange rates will play a big part in deciding the TCO, but one things for sure, the gap between off-shore or local supply chain is becoming marginal.
The same could be said for the UK…