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Electronics manufacturing grows in Eastern Europe

Eastern Europe is emerging as a new global hub for the electronics manufacturing industry, according to a new report by Frost & Sullivan.

Manufacturing is growing in Eastern Europe because of lower labor costs, increased foreign investment and the growth in the production networks in the region. The electronics manufacturing services market in Eastern Europe will grow from about $9 billion in 2006 to nearly $24 billion in 2013. „The need to maintain profit margins in the face of declining pricing trends and high competition has made low-cost manufacturing a necessity,” says Santosh Kumar, a Frost & Sullivan research analyst. „This is encouraging the continuing migration of manufacturing processes in the electronics industry to low-cost Asian countries and, lately, to Eastern Europe.”

The development of the outsourcing model by OEMs and electronics manufacturing service (EMS) providers is essentially driving the growth of the EMS market in Eastern Europe. In fact, the recession of 2001 has led to the establishment of many manufacturing units in countries like Hungary and the Czech Republic, according to Kumar. (