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Nolan’s Notes: Emerging Trends in 2025

January is a traditional time to mark changes in our lives. A new year can signal new beginnings. But change is constant. So, as we flip over the calendar into 2025, we look at what’s ahead for the EMS supplier industry. What are your concerns and challenges? What trends are emerging? What can you expect from a new administration?

Here’s what I found:

• Tariffs: The incoming U.S. administration is expected to shake things up. What we don’t know is how, when, or to what degree.
• Technical capabilities: This is taking form as UHDI capabilities, skilled workforce, and automation.
• Artificial intelligence: How do machine learning and predictive engineering fit into the manufacturing environment?
• Margins: Shake the economic magic 8-ball on the margin question, and the answer comes up, “All indicators point to uncertainty.” How will you be defending your margins in 2025? That isn’t so clear here at the start of the year.
• Nearshoring: China Plus One is an adjacent topic; it goes really well with this discussion.

It doesn’t take much thought to realize just how tightly all five are intertwined. Nudge one, and they all move a little; shove one hard, and they all move a lot. No matter how you look at it, there’s a lot of jiggling going on.

The experts we talked to for the January 2025 issue of SMT007 Magazine emphasized exercising caution as you start the new year. They used words like "trepidation,” “confusion,” and “uncertainty,” but it wasn’t gloom-and-doom thinking or a “woe is me” attitude. There was resolve and even optimism at the core of all the caution. So, here’s what we have for you in this issue.

A lot of progress has been made on the UHDI test vehicle, and Chrys Shea and Mike Sevigny give us an update. Behind the scenes, technical editor and industry icon Happy Holden has been drilling down into the UHDI technical details, so watch for that in a future issue.

Widening our scope, we present two interviews with industry analysts James Kim and Dennis Reed. Kim is an attorney with expertise in tariffs, and Reed is a technology manufacturing analyst with Edgewater Research. Their perspectives paint a rather detailed picture of the current market dynamics.

From AI to EVs, our columnists always keep it interesting. Jennie Hwang discusses the predominant methods for interacting: prompts and prompt engineering. Dan Beaulieu teaches you how to maximize your trade show return, and Tom Yang continues his series on the U.S.-China relationship. This time, his topic is our environmental footprint: “Profit-driven motives can coexist with environmental responsibility when companies view sustainability as a path to long-term resilience.” Be sure to check it out.

In his column, Mike Konrad addresses the troubles with EV charging stations, touching on one of my technology triggers in the process. He cites an alarming statistic: 22% of all public charging stations are non-functional at any given moment. Now just imagine if one in five gas stations were randomly closed. We’d have a huge supply chain crisis, much like the oil embargo days in the early ’70s. (I may have been young, but I remember it.) I’m an advocate for EVs, but I have some personal misgivings about the economic impact of EV charging. The challenges are two-fold. First, there’s the inherent delay of recharging during long-haul travel. Less obvious but more concerning to me is the economic impact of the service station supply chain. These retail stores, often run as mom-and-pop shops, are a hub to the community. Too many sit in locations where converting to all-electric charging for profit would simply not pencil out. Read Mike’s column and draw your own conclusions, but I think that the slowing EV adoption globally could be influenced by both of these factors.

My solution? Hydrogen is a much more easily integrated option into the existing distribution network. Filling your hydrogen tank would look very similar to filling a gas tank. Local businesses continue their role in the local economy, and the predicted copper shortages worldwide could be reduced. I’ve read that some automakers are signaling a shift to hydrogen, so we will see what happens.

These topics and others make this a salient time to examine our priorities, the trends we want to follow, and what has captured your interest. Welcome to an exciting new year.

This column originally appeared in the January 2025 issue of SMT007 Magazine.