Newsletter - June 2025

by Tim Kilfoil 

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Don’t look now, but it appears the old normal has made a dramatic return. Congress is fighting at length over boring old tax and spending issues. The Middle East has popped with age-old country conflicts pitting nations against each other, promising destruction, and the producer price index is back down to 2.5%. The price of goods hasn’t come down —and probably won’t —but at least the rate of growth has taken a bit of a break for the time being.

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If I could borrow a “pull quote” as the journos say, “The Producer Price Index (PPI) for manufactured goods, particularly electronics, has shown moderation, with annual increases dropping to around 2.5%, signaling relief from the volatile input costs that plagued the industry in prior years.” Yes, it has. And it’s about time. “This stabilization in prices for key components like semiconductors, printed circuit boards, and metals such as copper has enabled manufacturers to negotiate more predictable B2B contracts.” Yes, please. Some more of that, please!

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That certainly makes me feel better about 2025 as a whole. This could mean (knocking on wood) that the repeated refrain from the past three years, “We’re expecting improvement/ recovery/ hockey stick in the second half of the year,” can finally be laid to rest. No? Too soon to predict? Ok, fine, I’ll wait to see what happens before I cause a global “jinx” on the economy. Nevertheless, the U.S. electronics manufacturing sector seems, by many markers, to be in the early phase of recovery in 2025, led by “stabilizing producer prices that are easing pressures in the B2B marketplace.”

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So, how about you and your own business? Are you feeling any additional confidence? The Institute for Supply Management’s Manufacturing PMI remains above 50 (meaning expansion), as steady demand for components in automotive (not a pull quote, this is me talking and it is real), aerospace (me again, jet engines, and it’s real) and industrial applications (meh, still me, but flattish to so-so) drives activity and growth.

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Other notable observations from the field include the active realignment of sales channels among manufacturers. This appears to be happening as manufacturers finally take action to improve and enhance efficiency within their sales networks. We have seen this firsthand, as over a dozen manufacturers have reached out to us over the past three quarters. These are numbers that are very unusual in such a condensed timeframe.

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I will share our own experience, looking back over the past 3 years, the manufacturing economy has been slow. Due to our position in the central part of the country and the outsized impact automotive plays in this area, we have seen, felt, and experienced sluggishness. What the past 2 quarters have shown, however, is that a relatively firm pattern of small but consistent growth has developed. Will this glimmer of growth develop into something sustainable? Check back next month- I’ll let you know what I see. In the meantime, please reach out to me to share what you’re seeing: tmkilfoil@jfkilfoil.com.​

About Sales Engineering Co.
Sales Engineering Company (SECO), a subsidiary of JF Kilfoil, is a manufacturers’ representative established in 1943, supporting component, interconnect, and printed circuit board manufacturers in the New England electronics market. The company represents an expanding line of technology partners, reliable solutions, and on-time precision components. With a broad scope of best-in-class solutions, the company focuses on the automotive, industrial, military, appliance, manufacturing, power, and medical markets. SECO makes it easy to do business and establishes trusted engineering counsel, which has been the hallmark competency since its founding. If you are looking to become a market leader in your specific component category, contact SECO. Great Designs with Peace of Mind.