Steve Rawlins, CEO, Anglia
“The factories we deal with in China are reporting 20% staffing levels, and operating at 60% below capacity,” said Steve Rawlins, CEO of Anglia Components. This applies to manufacturers and raw materials companies for resistors and capacitors, he added. This is particularly worrying because, as he pointed out “You can’t make a circuit without resistors and capacitors”.
Although these factories expect to be back to full capacity at the end of April, Rawlins pointed out that there will still be an additional 16 weeks before they will be operating “at full speed”, as there is an eight-week manufacturing period and then a further eight weeks to ship the goods.
The distributor has a six months’ inventory, but is restricting sales of chip capacitors and chip resistors to protect inventory for regular customers. “Rationing resistors – it’s unbelievable! I have been in this business for over 30 years and I always say nothing will ever surprise me again, and then it does,” he said.
Rawlins reports connector supplies are unaffected and there are no major problems with semiconductors which have eight to 12 weeks lead times. The lead time for relays has been pushed out to 30 weeks but it is MLCC capacitors stocks that are being hit.
Each of the company’s suppliers and lead times is updated daily on its website, Anglialive.com. This also has information of expected delays.
It is hard to predict what will happen next as the spread of the virus and the measures governments are taking change. We spoke on the day the Italian government announced that its travel restrictions and lockdown policy was to be extended to the entire country.
There is a known cause and effect pattern though. “Overcapacity leads to price crashes, affecting the stock market and then backwards down the supply chain. There is a threat of a global recession,” Rawlins said.
