“The suppliers have kept pace with the requirements. Management has been key,” Mr. Peri said in an interview. Over 90 per cent of the components used in Suzhou are now produced in China.
As Celestica increased the complexity of the electronics products it manufactured in China, finding qualified workers was also an issue. But local universities now produce more than enough qualified engineers to staff the plant.
The Suzhou plant can now make the most sophisticated electronics the company produces for customers like Alcatel-Lucent, Hewlett-Packard, Cisco, IBM and Research In Motion.
The network routers the company builds in Suzhou, for example, have a possible 45,000 different configurations.
“I don’t think things get much more complicated than what we make there today,” Mr. Peri said.
The most striking thing about the Suzhou facility is how quiet it is. The hum of the factory’s bright fluorescent lights is the loudest sound as workers quietly assemble parts for ATM machines and other electronics.
Nearby, a worker meticulously checks the quality of an X-ray sheet from a recently built printer. The machines, which are shipped to hospitals all over the world, have more than 1,400 mechanical parts and are assembled in an air-sealed “clean room” where dust particles are almost non-existent.
While most of the products produced in Suzhou end up being shipped overseas at the nearby port of Shanghai, more and more are staying within China. A decade ago, Chinese customers accounted for just 10 per cent of sales; now they account for more than 20 per cent.
The Suzhou plant is expected to expand its production range to include electronics for the aerospace industry. As Celestica’s head of sales in Asia Mr. Lau points out, over the next 20 years, half of the world’s airplane production is expected to come from China.
“The vision is not just low labour costs. We are trying to target customers who have local sales here,” he explains.
“The local market is a very enticing factor.”