Weiner International Associates
           Weiner International Associates

Posted December 2015

I am constantly amazed at the job you do reporting on what’s going on
in the industry. I know from lots of years of experience that developing such a collage of meaningful data does is not done without a lot of thinking. Good job! ----- Raymond P.

You caught well the (HKPCA) show. I was surprised at how many western companies were attending, and that we were all looking for equipment and suppliers whom we would otherwise not see elsewhere. Ditto, many are trying to find ways to purchase directly to save money, etc. Time will tell how successful such efforts really are, but, as we discussed, it was a wakeup call for all: New avenues are being explored. Some bright entrepreneur will find a way to marry the Westerners' needs with the abundant supply in Asia. One additional observation is that the auto industry is strong in China, and many Chinese material suppliers are approved by the likes of Mercedes, GM, Toyota, etc., which indicates that the materials and supplies that are “local” may well be appealing to the quality driven Aerospace supply base – another wakeup call for many of us. ----- Peter B.

For many years I have talked about the need for Automation, and now finally Automation seems to be everywhere. I visited a customer before the show, this was a top tier PCB supplier who told me personally that if the machine is not automated it will not go into his facilities. That is how committed to automation many companies have become as China looks for a way to reduce cost to counter its increased labor rates. This trend was certainly evident at this show. Almost every booth had some kind of automation. On our booth (WKK) we launched a fully automated Multiline ATP-1000. The auto load/unload system, which had never been shown to the public before, was extremely well received. ----- Hamed E-A.

November 2015

Productronica was well attended by 38,000 participants from more then 80 countries. The major focus was on assembly and testing technology of PCBAs. PCB fabrication in Europe will be down 3% this year compared to 2014. Europe’s PCB industry now very much depends on its partners in Asia, mainly China. Total consumption of PCBs has gone up. Imports are now greater than local production.
For PCB fabricators in Europe, process improvements are key to reduce cost for material and maintenance to remain competitive.
LDI imaging systems attracted much interest. The cost for LDI machines used in prototyping has come down quite a bit and is now affordable for well managed shops. ----- Michael M.

Nothing is forever - one of our colleagues just sent us the following note

I'm in the process of destroying all my PCB technology files--laminating, plating, etching, etc. Dan, with his great antennae, senses the end of Printed Circuits, as we have known them. I've shifted my interest concentration to ICs and IC packaging, the drivers of electronic manufacturing upstream. But, you know that HDI is essentially unchanged from those days when Karl Deitz, Mike Carano, and Happy Holden kept us updated. They have moved on, but PCBs have not. Creative Destruction keeps on going. That's how aqueous developing triumphed. That's how mammals replaced dinosaurs. That gigantic meteor helped. But mammals survived it and thrived, because they were more adaptable. And that is how we arrived. The moral of the story is that to survive and thrive, one must be flexible, ready to adapt to new circumstances.

Potpourri on today’s fast moving events:

It's déjà vu again, just like the 80s. This time it is the PCB chemical company infrastructure that is due for consolidation and "rationalization". Many more will head out to the great unknown. I do think that there are important reasons for all the flux, the mergers, etc. They have to do with the Moore's Law, end games, and their impacts on packaging. Stacked die are here to stay. They don't replace PCBs, but they replace lots of the wiring. New memory technologies will make the Chinese memory acquisitions irrelevant: HP's memristor universal memory, Intel-Micron with NAND Flash.

And, yes, China will succeed in becoming a 1st World country! ----- Harvey M.

The role of the IPC to U.S. based PCB makers is difficult since N. American production is now only 5% of the world's. Many small makers in N. America seem to be OK in survival, but very few seem to see healthy growth. ----- Dr. Hayao N.

As you know, companies join industry organizations based upon the cost/benefits balance. I recall that when the NEPCON show was all the rage a company president told me that he could hire another engineer for what it cost to exhibit at NEPCON. His company soon exited the show. What one of your reader’s comments and your note tells me is that some companies find that the cost of IPC membership is no longer in balance with the benefits. ----- Dr. Lee P.

Productronica was well worth attending. The show was busy. We saw many new machine and system improvements as well as innovations in automation We acquired several new products to represent. This exhibition remains a "must attend" event for us. ---- Hamed E-A.

Posted October 2015

The 80 percent of "no shows" (American fabricators that are not IPC members) clearly see no value in or satisfaction with IPC ,and seem not to miss it. That may really say that there is no need for a fabrication centric/focused organization at this time. Only time will tell. ----- Anonymous

Publisher's Note: Perhaps these bare board people need a different type of association, a new relationship with an existing association, or have a need to redefine and reinvent their businesses, They should evaluate changing their horizons and boundaries.

Last week's SMTAI (SMTA/IPC) event in Rosemont was basically well attended. The IPC committee meetings were pretty full. The SMTA show floor was not overly crowded, but comfortable. However, I felt last year's event seemed to be better attended.

The designer certification classes were well attended, continuing a growth pattern for designer education.

Several sources indicated disappointment in session coordination. There were SMTA technical sessions that IPC members would love to have attended, but were in conflict with similar content events scheduled by IPC. I didn't have an opportunity to hear from SMTA attendees regarding this, but I imagine they had similar comments. It certainly would be a better event if there were better coordination between both organizations.

If you recall, in Connecticut both the SMTA Nutmeg chapter and the Southern New England Designers Council chapter coordinated joint meetings which were highly successful. Preparation was accomplished with both parties planning the events together, which resulted in programs that had a common interest to members of both organizations. ----- Gary F. 

As you know I’ve been involved with the IPC for decades and have been on the Board since 2006. I would like to take this opportunity as a current member of the Board and as someone somewhat familiar with the needs of independent PCB fabricators to perhaps provide some more detailed insight in response to your recent post. As you know, IPC represents and supports PCB member companies throughout the global supply chain to innovate, compete and succeed. Since its founding, IPC was and continues to remain the voice of the PCB industry.

More than half of IPC’s PCB-market members are based in North America and IPC provides focused support and opportunities to collaborate on industry issues with PCB manufacturers. Several examples of this from the past year include:
• Publishing PCB related market research reports based on statistical programs
• Developing a technical conference entirely dedicated to flex circuits and HDI, which will be held in Minneapolis Oct 28-30. Several independent PCB fabricators are participating as speakers and attendees
• Recognizing the importance of helping the PCB members by tasking the IPC Ambassador Council to develop a management program for PCB/PCB Supply Chain executives – you acknowledged this in your blog post expecting to deliver in fall of 2016
• IPC sponsored an exclusive dinner at IPC APEX EXPO 2015 for PCB executives to discuss ideas on how the association can help them be more productive and profitable
• Inviting PCB and PCB Supply Chain executives to attend the morning session of the Monday management meetings at IPC APEX EXPO, which focused on market opportunities and leadership
• Inviting PCB and PCB Supply Chain executives to attend the afternoon session of the Monday management meetings at IPC APEX EXPO, which focused on futuristic materials and packaging breakthroughs

These are just a few of the examples of IPC’s efforts to connect with and collaborate with PCB member companies just within this past year.

However, I believe that the biggest benefit that IPC has brought to the domestic PCB Fabricators are are ongoing in Washington, D.C. to represent the PCB industry on key issues such as tax reform, R&D tax credits, Toxic Substances Control Act (TSCA) reform and the final rule for Category XI for Military Electronics of the United States Munitions List clarifying that PCBs “specially designed” for defense-related purposes will be controlled under USML Category XI.

I feel wholeheartedly that IPC does not overlook this key part of our industry and supply chain. As in the past, IPC staff will continue to engage and collaborate with PCB member companies. I know IPC is open to meet with you or any PCB company to discuss your concerns. Please feel free to contact myself or John Mitchell, IPC President and CEO, (it has been my experience John is always ready to talk with members to better understand their issues and concerns) to discuss further. ----- Joe O'N.

Posted September 2015

Interesting as always. My thoughts:

First, in 15 to 20 years we will be making some boards using technology not very different than today. I’d expect more additive technologies. I do not agree that PCBs will go away. I believe new methods that do not require classic PCBs will develop but they will not obsolete all classic FR-4 type boards just a Transistors did not obsolete all vacuum tubes.

Second, I see IPC as an organization that is:
• struggling on what to do
• not very effective at supporting its members outside of its standards work
• too big with too many people that are unable to provide value to members
• as an organizations with too much money that they feel a need to spend
• spending too much time talking to themselves rather than their members
• has too many “old timer white guys” like you and I and not enough younger participants from Asia, India China, etc.

I’d go on to say that in my opinion, compared to SMTA, OSA and maybe iMaps, IPC provides less value to its members.

Third, my IPC enhancement/remedy for IPC would be:
• Put a few IPC people on-the-road visiting about 10 current or potential members each week to see how IPC can help, make IPC benefits clear, etc. Basically a serious outreach effort to visit every current or potential member at least once every 2 years, maybe more frequently.
• Look very hard at what value each person on the payroll is providing. I was surprised visiting IPC headquarters at how big it is and how many people they have for the “action” I see.
• Look at the IPC industry focus on board fabricators and EMS firms. An awful lot of activity is developing around assembly and product where the classic board and EMS input is augmented by Test, chip packaging, fluids, optics, thermal issues, RF issues, etc., that IPC does not seem to see as part of its area of interest. These new products incorporate more technologies and have much higher complexity than classic electronics. (When one of your reader’s commented below that in 15 to 20 years PCBs will go away, I think this is what they had in mind.) ----- Dick O.

With this edition you have outdone yourself – all topics covered are significant. Your first one regarding IPC touches on most of those you mention later on.

My guess, and it’s only a guess, why less than 20% of independent fabricators in the U.S remain members is that they are voting with their feet, or really dollars. With the continuing shrinking footprint of fabricators in the U.S. (point one under “As I predicted”) which is leading to minimal pool of qualified talent entering the industry combined with escalating and onerous regulatory issues requiring more waste of time reporting for all companies such as you touch on under “Ye Gads . . . . “ fabricators are looking for direction, assistance and programs that touch on creative and efficient ways to deal with these basic business issues as much as they want to know about advanced technology issues.

Regrettably, today the IPC seems more interested in developing costly, non-value add (except to the IPC) programs such as 6012 certification, and expanding their reach into more exotic markets segments, etc. than focusing on those who founded the organization. "Back in the day . . ." when the IPC Board of Directors were far more hands on with responsibility for leadership and oversight, common sense and timely programs were developed because the people developing them were the people who needed and wanted them. As organizations grow and leadership gets more removed from the front line activity the programs tend to evolve from simple, cost effective and pragmatic to larger, one-size fit all, costly endeavors.

Yes, IPC needs some fabricators, as well as people who are not retired or without corporate affiliation, on the BOD, but maybe the fabrication end of the industry needs a more hands-on organization to align itself with so the issues that impact the 80% of companies who are not IPC members, and may not be big and sexy (read high profit generators) to interest IPC, will be addressed. If such an organization exists I hope it is open to companies of all sizes from all over the world as globalization is a reality today while only a concept “back in the day”; and, we all need to understand more about what is happening “over there” so that we can be more competitive wherever we are. ----- Peter B.

I remember that trip*. It was great! At that time China was not that advanced in the PWB technology, and most of the good ideas (of which there were not many) came from the U.S. manufacturers who participated in the trade/technology missiion. How times have changed! ----- Ray P.

*IPC trade mission to China several decades ago.

I predict that in 15 to 20 years there will not be a PCB industry as we know it today. There will be no real need for most circuit boards, and those that are used will be just as basic interconnects. As 3D printing advances, and there are more monolithic integrated components, even those PCB’s may not be necessary except for the most basic interconnects. ----- Dan F.

While I was in ChangPing (at the WKKT and WKKM location) this week I noticed the school in the photo below. A tiny town in China has a training college for electronics. How about the USA? 
----- Lionel. F.
That is a surprising statistic. I cannot recall not seeing an IPC plaque in the lobby of any PCB company I have ever visited in the U.S. but they may have been legacy items and lapsed members. The internet may be part of the problem in that a lot of the information that used to come in the mail is now available online and often at no cost. That genie is out of the bottle and it is providing benefit to everyone member and non member alike. The IPC is doing a great job of getting information out there and they appear to have a handle on using advertising to add to revenues which is the internet model. However, the answers to your questions lie with those who are not "within the fold" and personal interviews (by staff or independent researcher I'm not sure) are likely to be the only way to tease out those answers and know the reasons for their lack of membership and what might bring them in or back into the fold. ----- Joe F.

Time is flying by quickly, and the next generation of new managers and industry leaders have different agenda in terms of serving the industry and the customers. We, experienced seniors in the electronics industry, have always tried to solve technical and cost issues, wherever it was needed in chemical supply, PCB fabrication, assembly, or in the total supply chain. Today, the focus is on interfaces. Details in technology and processes do not seem to be important anymore.

The changes in the China market have also an impact on the total supply chain. Here, manufacturing cost have become a more important items for PCB fabricators in China. Some have already chosen to leave China seeking sites (Vietnam, the Philippines, etc.) with lower costs.

Quality is a given fact and PCB buyers believe that every PCB fabricator has the same capabilities. You know that this is not the case! ----- Michael W.

These area all extremely important topics -- all about a paradigm shift that has been taking place within our industry, as well as in business in general.

Based on my college courses in economics, by definition anything that is built to a specific but continually changing customer specification, or "print" is not a commodity - except in our industry where decades back we lost the battle of explaining that we are value add fabricator of custom product. As we are considered a lowly commodity it is easy, and regrettably understandable, that many think all companies, globally, always produce the same technologies, and quantities with the same lead times and quality levels, etc. Fact is, as you well know, that is not true.

Ditto that any and all suppliers can be interchanged with the fabricator (and yes, end customer) receiving the same robust product, quality and cost. The fact is that each supplier has a slightly different formula that works better in some situations, less so in others, and ALWAYS requires significant process development and management to assure consistent results. And don't get me going about laminate where there is no competition for certain types so each laminate company has been allowed to have a de facto monopoly with critical types of materials.

The emergence of China, as well as all of the other alleged low cost manufacturing centers in Asia, has only succeeded in sucking any and all talent that may have been interested in and available to fabricators and suppliers out of the market leaving a very frail skill set in the North American, and I imagine, the European circuit board industry. This may be single most important issue that we, as a global industry, MUST come to grips with.

So what can be done? Industry leadership organizations such as IPC and SMTA need to acknowledge that the industry that is their sole reason to exist needs them to begin communicating that as a value add industry, we are an industry that delivers value -- at a cost -- and that fair cost must be borne by all customers. It must be borne so there is a future industry with companies that can afford talent, capital investment and R&D. Media also has to communicate that without talent, there will be no industry and existing talent is getting long in the south requiring the next generation to step up ASAP. Equally, the extraordinary role that process management plays on quality and cost containment needs to be better communicated by all. I have always found it interesting that companies of very different size, equipment and employee base can produce the same product while companies with identical equipment, people and size can produce radically different product and quality -- it is what makes this industry anything but a commodity and anything but boring to be working in!

So yes, all important issues. I just wish I could fully understand what the agenda is with this next generation of industry leaders! ----- Peter B. 

Posted July 2015

Let us hope that Platform does a better job with the various mergers than Rohm and Haas did with their similar acquisitions over 15 years ago, IMHO. PSP has a great opportunity to become the leading supplier for the next ten years if they handle it from a business and market view rather than an ego centric one - as some have done in the past. After all, buying a complimentary or formerly competing supplier is not just a game where a win should be celebrated. Rather than that, it can (and should) provide an excellent opportunity. I also agree with you regarding the IPC taking the opportunity to reestablish its leadership. The IPC is still a very important organization. Its dominance is no longer there, but its leadership should be! ----- Daniel F.

I miss NEPCON West. The N. American PCB industry was at its prime and it was enjoyable meeting the people, all upbeat, that attended that event.

The PCB industry exists because of PCB makers. Without them, there is no PCB industry. IPC EXPO attracted only about 10 makers, half of which are from China. But, none of them showed "cutting edge" technology products.

PCB is also a maturing industry. Today it is extremely difficult to see anything which is earth-shaking. Printed Electronics, Embedded Components, 3-D printing are promising, but where are they? For years Printed Electronics was viewed as replacing existing PCBs. But, we still produced $60 billion worth of PCBs in 2014, and it is inching up - with conventional image/plate-and etch technology.

In recent years I was able to attend most of the PCB related trade shows as conflicts were minimal (see below), but this no longer the case.

January was InterNEPCON Japan.
February was IPC Expo
March was CPCA Sow
April was KPCA Show
June was JPCA Show
July was Semicon West
August is IPCA Show
October is TPCA Show
November is Electronica or Productronica (2015)
December is HKPCA/IPC Expo

Attending all these trade shows requires total of 200 flight hours and a few bucks. Is it worth the effort? I often wonder, but I still continue to attend trying to find one or two interesting subjects.

“New” materials and equipment (mostly minor improvement of existing products) are seldom revolutionary. In the last twenty years, only three new
technologies sprang up: lead-free (which I think cost the industry billions of dollars), laser drilling, and direct imaging systems. All other technologies have been around for some time, and the ones billed as "cutting edge" often present just minor improvements. Many of these materials and equipment are repeatedly shown at each of these shows without much in the way of "revolutionary" or "cutting technology" improvements (Americans' favorite marketing phrases).

For this reason, I believe that trade shows should be held every two years.*

Of all the trade shows, I like Electronica best because it is held in Munich, one of my favorite cities in the world. At each of last three Electronicas (2010, 2012 and 2014), there were over 110 PCB makers exhibiting. IPC Expo had four US based PCB makers and four Chinese makers, but their exhibited samples were the same as those of previous year. The JPCA show attracts about 40, of which 10 are from China. A recent KPCA show had only two PCB makers, SEMCO and LG Innotek. The TPCA Show now has only three or four PCB makers. The 2015 CPCA Show surprised me with close to 35 PCB makers exhibiting - including a few Taiwanese. ----- Dr. Hayao N.

* Publisher's note: IPC APEX started as IPC PCB EXPO. The original intent was to hold the event every other year, much like Productronica. However, exhibitors such as Dynachem and Shipley were so elated with the results of the premier event that they persuaded the IPC over the objections of some of the makers of larger pieces of equipment, such as Excellon, to make it an annual exhibition. Where are these companies today?

Does the World Electronics Circuits Council (WECC) have any initiative any more? I know it is only every 3 years, and lately seems to be searching a venue to bolt onto. 2014 was in Nuremberg - 2017 will be in Korea. Could there be enough interest to hold one big (two week, or at least a 5 day) show - say every other year? My guess would be in Asia - but would country cultures get in the way? What about somewhere semi-neutral - say Singapore? Just thinking. ----- Denny F.

Truly an industry conundrum.

There are two issues that contribute to the conflict: language and location. As you indicated clearly the epicenter of the industry has shifted to Asia resulting in the increased energy and relevant, international in scope conference. However, attending either of the Chinese events requires a translator to make them truly of value to those from the “West”. APEX/EXPO, while having great content are very marginal shows as far as seeing equipment and what is new – however for those in North America it is still possibly the most user friendly event. Productronica has successfully remained relevant and competitive despite being in Europe.

So, the conundrum is that it is not feasible to go to all, and some are not universally as user friendly as they need to be should they want to have a truly global following. For a small, US centric guy like me who does want to see what is happening elsewhere it will be APEX/Expo (local/convenient) and one other: either Productronica or the China Fair in Shenzhen.

The CPCA appears to be angling for total supply chain involvement. All shows need to do a better job of differentiating themselves from the other events so it is easier for those who would attend to decide which to go to and how to tackle the event. A translator works when walking a show but to attend a tech session it may not be the way to go. And indeed, we all need to define our niches – our missions – and stick to it! As finding space for an event is one of the challenges when scheduling, I feel strongly that some of the events need to co-locate and some rationalization as to their focus (read, fab vs. chip vs. assembly vs. emerging/disruptive technology, etc.).

WECC should be addressing this, but I am not overly optimistic that when each organization is trying to make a buck they will choose to cooperate. If the SMTA and IPC, two organizations that are geographically and culturally so close still don’t really trust each other I think it will take a long time before the JPCA and CPCA will want to dance together.

A good topic for discussion and perhaps your query should be, "How does one rate which are “the” events to schedule and why." ----- Peter B. 

It is hard to see someone willing to invest the money to rekindle the U.S. fab market. I think it will take either government intervention -- which won't happen -- or a drastic revolution in technology. ----- Mike B.

Hi, I would love to see Electronics Manufacturing come back to the USA. I agree with you but I am afraid that Lionel may be correct in that the parade has passed us by.
I also believe that we do need a very large effort by industry leaders with a very large government fund backing them up.
Now the question is, "Who is going to step up and lead this come back?" ----- Mel P.

The United States has one key ace up its sleeve. It is a market of 320 million consumers. It is the responsibility of the government to create the conditions for the manufacturers to feel incentivized to make their products in the USA and the American consumers to feel incentivized to buy them! ----- Trevor G.

Interesting stuff. Military is important but relatively small by comparison to consumer products. There is another challenge more global in nature here now and looming ever larger in the not distant future. The world population topped 7 billion last year and will cross over 8 billion in 2020. What plans does the industry have to meet the import needs of the 4 billion people unfortunate enough to be born in the wrong places at the wrong time? Addressing sustainability issues in all areas of production are likely to prove more important to U.S. security in the long run. Of course as Keynes aptly noted, "In the long run, we're all dead." Fortunately, the earth will survive the human species if we cannot find fit ways to save ourselves. ----- Joe. F.

U.S. PCB domestic "production" in 2014 is estimated to have been around $2.7 billion excluding imports for resale by PCB manufacturers. 7 U.S.-based PCB manufacturers produced about $3.1 billion overseas, mainly in China. These 7 major fabricators continue to emphasize overseas production. Lionel F.'s comment is right. We continue to lose expertise here in the U.S. There are only three laminate makers left here: Park and Isola - Ventec has a small plant. Only Oak-Mitsui makes copper foil - in small volume compared to that made in Asia. Over 90% of PCB chemicals by U.S.-based manufacturers are made in Asia, particularly in China.

N. American consumption of liquid photo solder resist in 2014 is said to have been 350 tons. The majority of this is captured by Japan’s Taiyo Ink. China consumed 26,000 tons!

80% of laser drilling machines are made by two Japanese. There were 3,800 mechanical drilling and routing machines made in 2014. How many drillers were made by the only remaining U.S. maker, Excellon? Yes, there is ESI, but most of ESI's UV/YAG laser drilling machines are made in Singapore. I don't know of any AOI and AVI machine makers in the U.S.

Yes, small PCB shops may be constructed in the U.S., as On-Shore enthusiasts say, but I cannot see anyone foolish enough to build a large shop, say, a $100 million shop. Then, this company must import almost all of its equipment and much of its consumable material from Asia.

China faces a lot of challenges, but look at the level of investments for PCB expansion there even now. 2014-2015 will add 3.5% capacity. Small? Now, sir, 3.5% corresponds to 75 million square feet per year!

India and Brazil and even Mexico? Just forget it. Southeast Asia has been attracting investments from Japanese and S. Koreans, but no new investors from Taiwan in the last 10 years. I personally believe China will still be the world leader in production though 70% of its production is made by foreign transplants. Having said this, Chinese PCB makers are stepping up production lately using public money. China is about the only country where PCB manufacturers can still go public.

Sad, but this is the truth in my macro view. ----- Dr. Hayao N.

Editorial Note: During the first week of July, the Chinese government announced its intention to halt IPO's as one of the steps it will take to stabilize its stock markets. 19 major brokerage houses announced their intent to create a multi-billion dollar fund to use for "bail-outs".

Very interesting — the problem is trying to get someone to see the problem and be willing to DO something about it. ----- Carl G.

I have many comments regarding recent discussions on re-shoring or kick-starting a new wave of electronic manufacturing in the U.S., especially when it relates to Defense.

I personally have been watching NNMI proposals and awards closely since they were first announced. Ed Morris - director of the first NNMI on Additive Manufacturing - was the leader on Pb-free proposals to Department of Defense. In 2010, the Pb-free group had put together a fully documented proposal for $100M in projects to convert Defense to Pb-free electronics over 3 years. There was no funding made available for this. The IPC (John Mitchell) picked up the banner last year, and is currently looking for the $30M to finish the needed work (called Manhattan Project). Defense has made verbal offers to do bits of the needed work, but not fund directly.

I have been trying to find out what really happened to the NNMI initial proposal for electronics packaging and reliability. This goes to the core of the offshore volume chip packaging problem - worse than 95% of the circuit boards being built offshore. I know Defense MicroElectronics Activity (DMEA) has several qualified domestic chip packaging houses, but it would be easy to insert trapdoors in the 97% volume of chip packaging produced in Southeast Asia. All I have ever heard about the chip packaging NNMI was that "it didn't receive industry support", and is now off the radar.

I have heard that the initial 8-9 IMIs are to be expanded to 45. However, I don't know the funding mechanism - and a presidential election is coming up. Washington loves "shovel ready" projects to get in and get out in 1-2 years. Washington hates long term 5-10 year projects that sound like "corporate welfare". Who needs to support corporations? Aren’t all of their CEOs getting fabulously wealthy, while the average person is falling backward in standard of living? The IPC – I think at Capitol Hill Day - endorsed the concept of these manufacturing initiatives, but nothing more specific than Congress funding the NNMI concept.

In short, I am looking for leadership to implement an improved US industrial manufacturing base. What I see is: a lame duck President, election year coming in 2016 Congress not wanting to make waves that could get any one of them turned out. Only thing I can point to is 2017. ----- "An active industry expert”

What do YOU think the U.S. government must do to reignite electronic manufacturing in the homeland? Lower the U.S. corporate tax rate. Hong Kong's is 15%. Ours is 35% plus all the other job-killing regulations we have in place. So regardless of whether total manufacturing costs are only 5% difference, it is the burden of taxation and regulation that is keeping the jobs over there.
Do you think that it is possible given the size of the markets in China, India, and elsewhere? There is some work that will never come back to the States--in fact, there is work over there that we never had to begin with. The electronic revolution such as the iPad, iPhone ,etc. was never built here--so we shouldn't expect their return. ----- Greg P.

Thank you for continuing to send me your periodic updates/views. I kept the below because I am intrigued by your challenging question of what the US government can do to bring electronics manufacturing back to the US. Some thoughts:
  • 1. The military and other government agencies should push to bring electronics manufacturing back to the US to minimize security risks resulting from malicious software and firmware that can be buried in modern electronics by an adversary that has access during construction to the hardware. This is a hard-to-spot problem that is easily overlooked by those concentrating on price. Unfortunately, this policy change would result is a significant but relatively small EMS business/market.
  • 2. With the outsourcing model many US firms are using for high mix, low volume manufacturing, margin stack tends to drive up the final cost. Vertical integration will eliminate that. So, what we need in the US is a large, vertically integrated EMS firm that can serve the high mix, low volume needs of those needing electronics built. The customers could be US, European, Asian or South American based as long as this entity can offer good value. If we build such a firm from scratch, we can equip it with the newest and best equipment and processes, then locate the various functions in the best geographic locations and tie them together with a modern information system.
  • 3. Maybe the US government would help by sponsoring an IMI (Institute for Manufacturing Innovation) for electronics manu-facturing. The Feds have funded about 5 of these so far under the Obama administration NNMI aimed at bringing manufacturing back to the US. (see:

    http://www.manufacturing.gov/nnmi.html ). The feds invest ~$100,000,000 over 5 years into each of these Institutes and require matching funds from the States or industry. NY state, for example, is offering $200,000,000 of matching funds for an Integrated Photonics IMI to be headquartered in upstate NY. Some portions of the electronics industry would need to work together to propose such an initiative to the federal government. That may already be underway unbeknownst to me.
The basic idea in 2 & 3 is to build a modern electronics manufacturing capability including developing new equipment for the emerging needs and capitalizing on state-of-the-art IT to provide good value for High mix low volume electronics product manufacturing. ----- Dick O.

It’s a fascinating time in the industry. I just came from the iNEMI Research Priorities meeting and was excited to see the rate of change – and opportunity – and challenge. With ITRS regrouping their roadmap activities to ITRS 2.0 and lots of industry driver changes – everything connected (sometimes too well!), automotive automation, medical advances, wearables – Wow. In my own life I find the Apple watch has significant productivity – and personal fitness monitoring - utility, and being able to use my iPhone to update the dashboard apps on my Toyota with their Entune system is really super convenient. Just stay away from my steering and brakes! It will be interesting to see who will be the hardware winners – and who surfaces with the best malware solutions for what Cisco rightly calls the “Internet of Everything”. ----- Dr. Alan R.

Posted June 2015

Here is my personal opinion. The biggest problem to returning PCB manufacturing to the USA is NOT financial. I believe it is the fact that we no longer have the technical skills that we used to have. We have exported all the manufacturing 10 - 20 years ago, and most of the former PCB USA engineers/managers have changed industries or retired. ----- Lionel F.

Posted May 2015

Enough info for two or three reports---- and all informative. A thought. Has the Caribbean area and Cuba figured in any of the expansionist planning??? And, have we tried discussions with different U.S. State Governments for long-term grants to entice re-shoring? What would happen if some states waived all corporate taxes for a company guaranteeing a minimum number of employees??? ----- Bernie K.

As usual all very interesting. One observation is that every year, if not quarter, some of the largest PCB fabs post gains while others post losses: could business simply be moving between the top deck and because of cost/capacity there is not in aggregate enough business for all? If so then we will see yet another round of facility closings. ----- Peter B.

Penang, Malaysia, has a shortage of workers. Many enterprises operating in Penang have to import labor from Indonesia, China, Bangladesh, Nepal, etc. The Malaysian population is just 27 million, and many Malaysians want to work in Singapore because they can get three times the pay there. Everyone else wants to go to Penang because this state has the largest Chinese population in Malaysia (nearly 60+% of the population there). I have a Japanese friend who closed a manufacturing operation in Johor where 90% of his employees were Malaysians of Muslim stock. They pray 5 times a day, three of which are during the work period. Muslim Malaysians in the management position have to go to Mosque every Friday for one hour. They are gone from 12:00noon to 2:00 to 2:30pm. Enterprise owners must take this cultural/religious situation into consideration when planning site locations. On the other hand, there are many successful industrial operations in Malaysia. ----- Dr. Hayao N.

Posted April 2015

I doubt robotics will be "the" answer. I have said it for years -- China has taken a page from our old playbook by having an economic PLAN and following through on it. From the mid 1800's through 1970 the US government fueled advancement and technology from the transcontinental railroad (which could NEVER happen today as it did then) to telegraph across the country to electrifying the country, to NASA -- all created opportunity, technology and JOBS! If "on-shoring" is to occur, it will take an unimaginable shift in thinking in Washington and in the Corporate offices of global giant companies. If you want economic growth in the technology and manufacturing sector you had better commit to it in actions not just words. China, Asia, the rest of the world -- will adapt, do what they have to do to be successful: maybe harness robotics but most likely just invest via incentives in their country's businesses so they can compete globally despite rising costs. They have too many people who want/need too much for them NOT to do so. On the other hand, the US and the West need a wake up call that if they do not commit in kind to "strategic" industries, such as electronics and technology, catching up will be impossible. ----- Peter B.

Bernie K. makes a good a good point, when the economy is stressed, government involvement may be necessary. To go to the extreme, if we completely rely on the private sector, then the military should become a privately owned organization. I don’t think many of us would support such a concept. Then perhaps it makes sense to look at other situations where government involvement in the economy would be beneficial. Economic warfare is certainly a case in point. In the past all industrialized nations essentially played by the same set of rules and kept government intervention out of the economy. This is no longer the case. Many of our international competitors relay heavily on government support for their R&D activities and it is putting our nation at a perilous economic disadvantage. To overcome this disadvantage I see no other choice but government involvement. In my mind the real issue here is how to do this in a way that the private sector is in control. ----- Dr. J. Lee P.

Great dialog! - I recently attended a Chamber meeting here in New York State – not the cheapest labor market - where a manufacturer of large and complex valve systems mentioned they had just taken out their robots and replaced them with people. Skilled people are easier to “program”! Now this won’t work if you are making a million phones a day but many other skilled industries will find the disadvantage of robots – you have to pay for them 24 hours a day but you only may only need to pay people 8 hours a day. ----- Dr. Alan R.

Posted March 2015

I spent a number of years designing industrial robotic systems. These systems focused on tasks where precision was necessary, conditions were hazardous, or to improve production. Robotic systems are great for those jobs that no one really wants to do, and a means for increasing production without the added costs of an employee. No sick pay, no holiday pay, no vacation pay, no insurance, etc. The down side of industrial robotics is that it tends to eliminate a number of lower income jobs. Let's face it, not everyone is cut out to be a manager or engineer. There is a large percentage of our population that depends on lower paying positions to support a family. All the better if they can advance up the ranks, but many never succeed in doing so. Just look at all the poverty infested cities around the country.
The initiatives of the Chinese government are great. I wish our country would do the same. It possibly could force the return of some manufacturing that was lost to the Far East. However, I fear that these automation incentives provide fuel for a greater dependance on government services by more and more of the population. As you know, I'm not in favor of bigger government. The more the population depends on the government, the more powerful the government becomes, and the easier it is for the government to take away from the citizenship.
My two cents. ----- Gary F. 

We have to admire the strategic planning (by local Chinese governments). If successful, I guess plants using the robotics will be able to produce more at lower prices ---- a benefit that will make those plants more attractive in drawing overseas business and again encouraging offshoring from here. It would seem that the only way to combat this is head on and establish our own subsidized robotic programs in strategic industries. I'm feeling suddenly protective about the sources that we must maintain to assure our self-sufficiency in defense and other critical areas. ----- Bernie K. 

Um…so in their bid to be competitive won’t they create unemployment? ----- Alan R.

I was in China last week during the CPCA and the Electronica / Productronica China shows. Here, Robotics was a major topic. It fully confirms what you have written. If German companies are in China to sell robotics (supported by the German Government) there must be a market. In addition, I visited some PCB fabricators in the Shanghai and Nanjing areas. All the equipment was highly automated using conveyor transport systems and were clean and environmentally safe. ----- Michael W.

Sounds familiar.This is a good one ----, very relevant. ----- Dan F.

As always an interesting and thought-provoking column. With regard to your comment on taxation of goods produced off-shore, the G20 is working towards a new initiative whereby they will exchange tax information on individuals and entities using a new software system that has been shared among them. It is scheduled for full implementation by the end of 2015. The thrust of the initiative is to reduce tax evasion and have tax paid at the point where the product is consumed.

Discussing this with a number of industry insiders, I am told this will be a game changer for re-shoring if the G20 initiative is successfully implemented. ----- Trevor G.

Industry sources state that there is some concern over the TTM-ViaSystems merger in that he resulting organization would have nearly 50% of the Department of Defense’s source of printed circuit board fabrication.

One undisclosed source says the he doesn’t see so much re-shoring in electronics. He calls the effect "cheap-shoring" as for instance the recent moves by companies shift manufacturing from China to Vietnam. He thinks that the "board brokers" Bare Board Group, Divsys, NCAB Group, Epec, PalPilot and others combine to take the place of some of the re-shoring by supplying design, quality training and oversight,, and support.

However, the equipment suppliers have moved an awful lot of manufacture offshore, and foreign (particularly European) ownership of equipment companies is widespread. For instance, Universal is essentially the sole remaining N.A. pick-and-place company. Also, we find with equipment, much of the final assembly, e.g., BTU or Heller, is in the destination country, meaning China or nearby Asian lands. However, some critical vision, programming, and other engineering intensive steps are shipped in sub-assemblies from the home country.

There still seems to be a full spectrum of counterfeit products ranging from blatant re-marking to sophisticated stolen (or reverse engineered) mask sets producing fully functioning clones of legitimate chips - with long expected use life. In multilayer circuit boards we are starting to see substituted cheaper core layers between legitimate specified outer layers to cut fabrication costs. These are difficult to detect in a functioning board that does not “blow up”. ----- undisclosed sources

Mobility has always been a characteristic of a free market system and the scenarios you suggest will always be factors of concern in building a domestic industry presence. Under our system of free enterprise we're stuck with the risks and dangers.

But what if conditions force us to seriously consider a change to that system with strong Government participation in the form of subsidies and tax advantages for key industries? What would happen if we were to designate certain industries as essential to our national security and give tax breaks to
domestic operations and assign punitive tax rates to profits from off-shore operations when brought back? Are such plans feasible even though they may appear essential??

I suspect that if we are forced to consider total dependence ---- even critical levels of partial dependence --- on foreign sources we may see laissez faire go right out the window. Really---- can we ever afford to be overly dependent on foreign sources and/or interests???

And, all of this is speculation is within a settled political environment. Think of the same scenarios in a political turmoil. In thinking this through I'm not getting any happier. ----- Bernie K.

Here's my opinion of the IPC APEX show this year. Although the show was bigger than previous years, I did not think the attendance looked good. Based on my knowledge of attending many shows over the years it did not seem to me to be very busy even the show was bigger - but this was just my observation. With regards to what was "shall we say" the HIT of the show, it was for sure the new

CAMTEK direct imager for solder mask and legend ink. ----- Lionel F.

Posted February 2015

I won't offer thoughts on equipment and technology but I will comment on Dieters tribute. It was packed and as I looked around I saw the "who's who" of our industry - people who made lasting contributions who spoke from the heart about Dieter with love, admiration, and fun! I realized how insignificant most of us (me) are compared to those who like Dieter invented and refined processes that now are the bedrock of our industry. And, David Bergman the MC did a hall of fame job that Dieter would have truly been proud of. ----- Peter B.

What a great tribute to Dieter: Both the sincere thoughts expressed and one of the best shows in a while. Thank you for the update. ----- Gregory A.

Very nice reporting on the Dieter Bergman Tribute. I liked the personal touches and family references. ----- Bobbi G.

Good words about Dieter. I’m surprised by how much I feel we have lost. -----Richard O. 

Posted January 2015

I fully agree that Dieter's contributions to the industry eclipsed almost all, if not all others. Even more importantly Dieter loved life and the people around him. I hope the event shares his joy of living as much as his phenomenal accomplishments! ----- Peter B.

The Dieter Bergman Memory Remembrance Trophy is a wonderful thank you acknowledgement.
My recollections of Dieter go back to 1978 when I introduced him to the United Kingdom scene accompanied together with Rollin Mettler the then President of IPC, when we established and organised the First Printed Circuit World Conference which is now The Electronic Circuits World Conference. Thirty seven years have passed by and Dieter remained at the forefront with his contributions to the PCB Industry until his death.
Great Man! ----- Rex R., OBE.

...Many times over the years I have heard our customers complaining bitterly about how much money we Board fabricators) make. They seem to think that all the shops in American are making money hand over fist and that seems to bother them. I have to wonder why that is. When we hear that Apple and Microsoft make a lot of money we're thrilled for them. We not only think that's fantastic but we often line up all night to buy more of their products all the time knowing that their products are so well priced (for them) that they will make a fortune at the end of the year.

We just love the idea of the hundred thousand dollar car and wish we could buy one. We love to over spend on jewelry and cruises and clothing and watches and yes colleges...The more we spend for college the more we brag about it because the prouder we are and we're all killing ourselves to get our kids into these (top tier) colleges so we can pay even more.

Great chefs go out of their way to spend top dollar for the best produce and meats that money can buy. Have you priced a pound of truffles lately?

Cabinet makers search the world for the best and most expensive materials and woods that money can buy.

Artists spend small fortunes on the best paints and brushes that they can get their hands on.
Designers and architects look for the very best materials to build their products.
Carpenters (true artisans) go out and buy the very best equipment and tools that they can wrap their hands around.
How about athletes' They look for any, equipment that will give them an edge no matter what the price... that's simply not an issue.
The same for physicians and their medicines and medical equipment.

But what's the deal when it comes to printed circuit boards? What do our customer think? That we're supposed to be non-profit organizations?
One of my clients ran a promotion recently trying to bring in new business. His plan was to offer ten percent off an order from a new customer. He felt that the trade-off for getting a new customer would be worth it. Sure enough he got a call from one of his customers saying," I always suspected that you were making too much money and now you've proven it, I want that ten percent discount, too."
Really, you can't make this up. It goes right back to the fact that our industry commands absolutely no respect, and our products command no respect either.

...Why do our customers think we are making so much money?... Do we look like a thriving industry? There are only a couple of hundred board shops left in this country... Is it going to take all of them going out of business before someone gets the idea that it might be a good thing if his board shop vendors made a profit once in a while?

...Could it be that these customers who think they are paying too much for boards don't think that ... their end products are important enough to warrant the best that money can buy? Hmm maybe they're right; after all they are only building missiles, anti-missile systems, aerospace products, and security devices, and, oh yes, life supporting medical devices. Yes that must be it! They feel that the products they are producing are not important enough to use the best that money can buy. Ya think? ----- Dan B.
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