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February 2020

 

The China Printed Circuit Association (CPCA) has announced a new date for the March event that was postponed due to the Coronavirus epidemic. It stated that after negotiations with the National Exhibition and Convention Center (Shanghai), the 2020 International Electronic Circuits Exhibition (Shanghai) will be held from June 22 to 24, 2020. The CPCA says that the original venues and the pre-selected booths will be unchanged.

 

"In accordance with government guidelines and to protect the health and safety of exhibitors and guests, we regret to inform you of the postponement of SEMICON/FPD China 2020 and related events originally scheduled for March 18-20, 2020. SEMI China is actively working on a contingency plan for rescheduling of the event and will keep you informed as soon as a confirmed plan is in place. We apologize for any inconvenience caused by this change, but your safety is our top concern.

....

SEMI is evaluating the health risks the Novel Coronavirus poses at other upcoming exhibitions and conferences and will make decisions whether to hold them as planned on a case-by-case basis.

....

We wish you all the best and good health!"

Richard Salsman                                           Lung Chu
CFO & Vice President Operations, SEMI      President, SEMI China

 

Thursday, February, 29, 2020

 

China states that 95% of state owned businesses have resumed operations after the Coronavirus outbreak - but they still face l;abior shortages due to the total disruption of internal travel in sime regions. However, the majority of "smaller businesses" are having diffculties restarting their operations. The cost of air freight for exports is reported to have been driven up as much as tenfold as Europe's automotive companies are said to have purchased the majority of available space to keep its production lines running. The IPC's prediction of 5-week delays in shipments from China may have to be revised upwards. This is partly due to the internal breaks of domestic supply chains caused by an effective lockdown of a large segment of the country with with the closure of a number of airports and railroad stations as well as highways.

 

The IPC Raymond E. Pritchard Hall of Fame Council will address lessons learned in addressing supply chain disruptions in a new Forum designed for emerging managers as well as senior industry leaders at IPC APEX EXPO 2021.

 

Gary Evans, Economist at the Custer Consulting Group showed some fascinating charts at IPC APEX EXPO 2020 displaying the effects of smartphone cameras on the 35mm and other camera markets at the Custer booth.

 

Chemplate Materials of Barcelona Spain exhibited unit #2 of its new InduBond® X-PRESS 100 lamination press.

lamination press in the GreenSource Fabrication booth. Unit #1 is at GreenSource where unit #2 is destined to be shipped. 

The new press produces heat on the laminated material, and only the laminated material, of each layer of a press pack at the same time, at the same temperature level, without any thermal conduction. The Indubond is reported to provide greater uniformity and reduce press time severalfold over conventional systems.

 

German Robotics's CEO Norman Weiss was seen meeting at IPC APEX EXO 2020 with a number of companies seeking U.S. distribution rights to the amazing 7-axis Panda robot by Franka Emika.

 

Guangxin Materials, part of Jiangsu Hongtai, stated its net profit for 2019 will be about $12 million.

The company’s main products are PCB inks, special coatings (including solder masks) and other electronic chemicals. The products are mainly used in printed circuit boards, precision processing of electronic products and consumer electronics. In 2018, the company acquired Hunan Sunshine to strengthen its development of new UV materials.

Traditional solder masks have a high Dk and Df, which cannot meet the high-frequency transmission performance and heating resistance in the 5G communication era. Therefore, low Dk and low Df materials are the key. The 5G base station PCB requires high-frequency special solder masks, and the company claims to have the first-mover advantage. In 2019 Guangxin Materials had an ink production capacity of 6,500 tons. It has invested in an additional investment of 8,000 tons of production capacity and is beginning to scale up manufacturing in the new equipment.

 

Thursday, February 13, 2020

Taiwan-based ODMs’ plants in Kunshan, China are facing serious labor shortages at the moment with a majority of their workers still unable to return to work, according to sources from the upstream supply chain.

At the moment, major Chinese cities including Hangzhou, Zhengzhou, Guiyang, Harbin, Linyi, Shanghai, and Beijing, have all shut down their transportation connections to the "outside," preventing ODMs from acquiring existing or new workers. ----- Source: DIGITIMES

 

Semiconductors at the Wuhan COVD-19 epicenter

 

South Korea's memory maker, SK Hynix, is the largest foreign investor in Wuxi. It set up a new 10nm DRAM plant there last year at a total cost of $8.6 billion. It has a capacity of 180,000 12-inch wafers per month. Prior to the Coronavirus outbreak it had planned to increase its market share of DRAMs in China to 45% from last year's 35%.

 

Chinese specialty foundry house Hua Hong Semiconductor has also built the country’s first 12-inch power components foundry fab in Wuxi at total investment of $10 billion. The company had started trial production of 55nm chips since the third quarter of 2019. Monthly capacity was set at 40,000 wafers.

 

Government measures to contain the spread of the coronavirus in China delay the rollout of next-generation 5G telecom networks, one of China's major technology goals.

 

March 2020

 

At the month's end China's vice minister of the Ministry of Industry and Information Technology Xin Guobin said that China is speeding up 5G and data center as well as industrial Internet construction to help the economy rebound after the COVID-19 pandemic. About 95% of China’s information technology firms were reported to be back at work. Guobin stated that China will speed up 5G, data center and industrial Internet construction to boost innovation and help the economy rebound.

Industry giants including LCD panel makers BOE and CSOT, SMIC and Foxconn have all resumed production.

 

How has your supply chain performed/changed during the Pandemic? How are you managing your business during the Covid-19 crisis? Have you had to shut down part or all of your operations? Do you have a recovery/restart plan? Have you been the victim of rising air freight costs from Asia? Is your company part of the critical infrastructure needed to support medical activities, relief activities or the military? Have you been able to provide adequate spacing and protective gear for those employees that are needed on site? Are you checking employee temperatures on the way in to work? Have you sought or offered to share excess capacity or services? Does your state's or town's policies and conflict with federal guidelines? Learn how others have dealt with the challenges. Attend the IPC's Hall of Fame Council Forum designed for new as well as existing managers on January 25, 2021 at IPC APEX EXPO 2021!

 

The bans, cancellations, postponements and alternative measures due to the Covid-19 virus are increasing exponentially.

 

Due to the current guidelines and restrictions, iMAPS New England has decided to postpone our upcoming 47th Symposium & Expo until, at least, October 2020, and, in addition, suspend planning of all other "in-person" meetings or events, until the situation improves. 

 

The March Productronica China and Electronica China trade shows which were postponed due to the Covid-19 outbreak have been rescheduled for July 3-5 in Shanghai.

 

In light of the rapid outbreak of the Coronavirus (COVID-19), SMTA Europe is taking precautionary measures for our conference participants and delegates and has decided to reschedule the 2020 Electronics in Harsh Environments Conference to December 1-3, 2020 at the Park Plaza Amsterdam Airport.

 

Dateline March 17, 2020: The Electronics Representatives Association 2020 has been canceled. In the wake of rapidly changing and unprecedented circumstances surrounding the 2019 Novel Coronavirus (COVID-19), the EDS Board of Directors, along with sponsor associations — ECIA, ERA and GEDA — have made the decision to cancel the EDS Summit this year.

 

SEMI announced that it is postponing SEMICON Southeast Asia 2020 from May 12-14, 2020 to August 11-13, 2020. The postponement is due to concern surrounding the ongoing international coronavirus (COVID-19) outbreak. The venue for SEMICON Southeast Asia 2020 will remain the Malaysia International Trade and Exhibition Centre (MITEC).

 

Due to the increasing spread of covid-19 in Europe, Mesago Messe Frankfurt GmbH has decided to postpone the SMTconnect from May 5-7, 2020 to July 28-30, 2020. The venue remains the Nuremberg Exhibition Centre.

 

The HDP/EIPC Automotive Workshop to be hosted by Ventec in Germany this May has been postponed. In the interim, the HDP (High Density Packaging Users Group) consortia plans to schedule a webinar to address key issues facing automotive electronics, unique reliability issues and materials challenges. IBM, Rochester, MN will host the HDP fall meeting On October 7-8.

 

The Oregon SMTA Chapter Tutorial Program Event "DFM to DFX: The World of Shrinking Electronics" presented by Dale Lee of Plexus will now be held by Webinar due to virus concerns.

 

The China Printed Circuit Association (CPCA) has announced a new date for the March event that was postponed due to the Coronavirus epidemic. It stated that after negotiations with the National Exhibition and Convention Center (Shanghai), the 2020 International Electronic Circuits Exhibition (Shanghai) will be held from June 22 to 24, 2020. The CPCA says that the original venues and the pre-selected booths will be unchanged.

 

Meanwhile, business events ranging from exhibitions, property sales and financial product launches to spring receptions have either been cancelled or delayed in Hong Kong as a result of the Wuhan coronavirus outbreak.

 

Will small and medium sized companies need to partner with others, including competitors, in order to recover from the COVID-19 caused supply chain disruptions, meeting and conference cancellation and delays, as well as resulting shortages? Explore this and other management issues,solved or as yet unresolved at the January 25, 2021 Raymond E. Pritchard Hall of Fame Council's Forum. Contact me if you wish to be a speaker at this timely event which will explore actions and strategies.

 

Reuters reported that India is planning emergenct airlifts of electronic components from China, three government officials said, as India tries to contain the fallout from the coronavirus crisis in China. India’s federal technology ministry has asked electronics and smartphone industry lobby groups to draw up a list of components made in China, which then can be airlifted, two officials said. China is still grappling with a range of production and logistics delays. Electronics manufacturing, especially the assembly of smartphones, is a bright spot for India’s otherwise flagging economy, but the country is still highly dependent on China for components.

 

An exception?

 

Despite the difficult global situation, as of the 6th of March, we are pleased to announce that Multek is running at full capacity with continuous on-time shipments to our customers. We are maintaining a close watch on the Coronavirus situation and will take appropriate actions to mitigate any adverse changes.

 

Beijing will likely replace as many as 20 million computers at government agencies with domestic products over the next three years, according to research from China Securities. More than 100 trial projects for domestic products were completed in 2019. The Financial Times newspaper said the Communist Party's Central Office earlier this year ordered state offices and public institutions to shift away from foreign hardware and software. Source: Bloomberg

 

We have reports of concern by attendees around the world of putting a hold on plans to attend major shows such as SEMICON China in Shanghai during the next few months. China's new travel restrictions as it tries to contain the outbreak could also adversely affect the domestic attendees or the shows themselves if containment is not rapid. Export shipments could also be adversely affected during this period as airlines weigh cancellations or re-routing of flights during the emergency activities.

India

Some Indian factories are running at half their capacities since manufacturers, overall, are heavily reliant on China for components.

India’s cabinet has approved a $6.37 billion plan to boost electronics manufacturing and woo large investment to a country. India is now the world’s second-biggest mobile phone manufacturer and is moving to decouple its dependence upon Chinese comonet and material sources.

New Delhi will provide companies a production-linked incentive of 4% to 6% on incremental sales - over base year 2019-20 - of goods made locally for five years.

 

InterNepcon Japan 2020

 

Dominique Numakura of DKN Research reported the following.

 

Fine pattern generation is an on-going project for printed circuit manufacturers. Chemical’s suppliers JCU and Okuno demonstrated smaller line pitches than 5 microns produced through a semi additive process. These processes can generate one micron traces, but circuit manufacturers are not ready to use the ultra fine circuits. Current assembling processes and connection technologies that use soldering and wire bonding are not capable to use the ultra-fine traces. Compass, a tape shape flex circuit manufacturer in Hong Kong displayed finer traces than 15 microns designed for driver modules for display devices, and double side COF (Chip on Film) with micro via holes produced reel-to-reel manufacturing process.

 

Low loss materials for high frequency circuits are an ongoing design project. American laminate suppliers Rogers and Nelco dominate the market for rigid circuit boards. 

 

Liquid Crystal Polymer (LCP) film is leading the flex circuit industry. New low loss materials such as low loss polyimide film, fluoro polymer resins and PEEK.

 

P-ban.com, an online printed circuit supplier displayed various new products including multi-layer rigid boards, flexible circuits and rigid/flex.  One of their main features is a series of flexible thick film circuits produced by screen-printing process, with fine line circuits down to 30 micron line/space. The company also displayed Monocoque Circuits, a unique hybrid 3D circuit produced by thick film technology.

 

Chinese circuit manufacturers and distributors continue to increase their presence at these trade shows. Most of them claimed they are capable to supply a broad range of circuit products including rigid, flex and rigid/flex.  They provided snapshots of their manufacturing plants in China.  I was impressed with their buildings and manufacturing equipment; most of their facilities looked better than circuit manufacturers in the U.S. and Japan.

 

The M&A game

 

It seems that mega-mergers always cause "rationalization", spin-offs, and realignments - some post merger, others pre-merger.

 

DuPont is reported to be evaluating the sale or spin off of its electronics unit which accounts for more than  15% of the organization's current revenue.

A divestiture of the unit would effectively complete a full breakup of the chemicals maker. DuPont, which had four primary business lines following the split of DowDuPont Inc. It was less than 3 years ago that DuPont and Dow Chemical compketed the largest chemicals industry merger evernwhich was quickly followed by a breakup that formed a standalone DuPont, Dow Inc. and Corteva Inc.

 

BAE Systems will acquire business units from both Raytheon and United Technologies  (UTC) as a way to help the latter two meet the antitrust requirements of their impending merger

BAE reached agreements to acquire the GPS business of UTC subsidiary Collins Aerospace as well as Raytheon’s Airborne Tactical Radios business, according to a press release. 

The buyer will pay $1.925 billion for Collins’ military GPS business, and $275 million for Raytheon’s radio business. The deals will be asset transactions that come with more than $400 million in tax benefits, according to BAE. 

 

Testing

 

Highly Accelerated Thermal Shock (HATS™) High Speed Via Reliability test systems have now been updated with HATS²™ Technology. These updates provide HATS™ test systems with a wider temperature range (-55°C to 265°C), an improved measurement subsystem capable of high-current, micro-ohm precision, 4-wire resistance measurements and the ability to perform Multiple Cycle Convection Oven Reflow Simulation with in-situ resistance measurements in accordance with IPC-TM-650 Method 2.6.27B. This update also allows HATS™ test systems to test up to 72 IPC-2221B Type "D" coupons and 36 Traditional HATS™ or new HATS²™ Single Via coupons for both Multiple Cycle Convection Oven Reflow Simulation and Thermal Shock/Cycling.

 

According to Bob Neves, Microtek Laboratories China CTO/chairman, “Designers can include 1 or 2 daisy-chain nets along with 5-6 single via nets on the same HATS²™ Single Via Test Coupon. This should provide a bridge between traditional daisy-chain and single via net test results.”

 

 

Britain's Institute of Circuit Tecnology (ICT) which provides an annual Foundation Course in PCB manufacture and design just held its Spring program. The ICT continues to grow with its membership now surpassing 400.

 

April 2020

 

Still scheduled as of April 30

 

The International Electronics Circuit Exhibit (Shanghai) sponsored by the HKPCA and the CPCA, June 22-24.

 

SEMICON West July 21 in San Francisco.

 

Tit for tat?

 

China has adopted tough new cybersecurity rules for buyers of technology equipment. This could place foreign tech products at a disadvantage in the Chinese market.

 

The new procurement rules announced by the Cyberspace Administration of China (CAC) red set to take effect June 1. They require operators of “critical information infrastructure” to go through a cybersecurity review process when ordering goods and services that may affect national security.

 

Under the new rules, before signing a contract, companies must submit procurement documents, purchase agreements and an analysis of the deal’s potential national-security impact for government review. The procedure normally will wind up within 45 working days but may take three months or more in complicated cases, said the CAC, which will lead the interagency scrutiny. The Ministry of Public Security is among the other agencies involved.

 

China has broadly included businesses with computer-network operations in telecommunications, energy, transportation, information services and finance in the classification of operators of critical infrastructure.

 

Worrisome for American businesses is the wording—retained from the draft published last year—that companies must assess risks of supply-chain disruption due to “politics, diplomacy and trade.” The wording was seen as a direct response to the U.S. move last year to add Huawei Technologies and several other Chinese tech firms to its trade blacklist that effectively banned suppliers from selling parts and technologies with a U.S. origin to those firms. Source: WSJ

 

Rebooting

 

Are you preparing to initiate the new normal? What are your customers and prospects doing? Are you coordinating their ramp-ups with yours? Have any of your customers gone out of business? How will you replace them? Do you wish to replace them or focus on something else? This may be a good time to eliminate previously unprofitable lines.

 

How will your operations be changed? You must check the status of your idled equipment. How will you modify and protect your supply lines? Will you create and offer new incentives?  Will you demand consigned inventories of critical items?

 

It's time to begin initiating your plans to restart if your operations have been closed. Will all of your workers return or be "hi-jacked" by others? You have to re-assess your manpower needs. Will you have new operational protocols in place?  Hopefully, your staff has used the "work from home period" to further train, update, or to certify your employees on needed work skills.

 

Virtual meetings, classes and training have reached new heights during the pandemic. This is a good time to consider LEAN manufacturing principles if you have not done so in the past.

 

Here's one way to stimulate reshoring

 

Japan will pay firms to leave China and relocate production elsewhere as part of a new plan to restart its economy. The country has earmarked $2.2 billion of its record corinavirus economic stimulus package to help its manufacturers shift production out of China and back to Japan as the pandemic disrupts supply chains between the major trading partners.

The extra budget, compiled to try to offset the devastating effects of the pandemic, includes $2 billion for companies shifting production back to Japan and nearly $220 million for those seeking to move production to other countries, according to details of the plan posted online. Source: South China Morning Post

 

5G and flex

 

High-frequency and high-speed flexible PCBs are emerging as indispensable components for antenna transmission modules for hand-held devices, IoT networking equipment and automotive electronics, and many Taiwan-based FPCB makers are gearing up to grab the ensuing business opportunities with new offerings.

 

This has driven the upstream flexible copper clad laminate (FCCL) segment to enter a technology-intensive era while playing a crucial role in the high-end FPCB market, Zhi-ming Yen, president of Taiwan’s leading FCCL maker Taiflex Scientific, told Digitimes in a recent interview.

 

Telecom equipment providers Huawei and ZTE have increased their rates of component orders for 5G infrastructure after being awarded contracts from China's 3 major telecom providers according to sources in their supply chains.

 

May 2020

 

The rapid rate of change due to Covid-19 is increasing resulting in making intermediate range planning for many in the electronics supply chain increasingly difficult. One of the not unexpected consequences has begun - that of strong organizations acquiring about to fail or financially weakened businesses in the electronics industry supply chain to broaden bases, secure supplies, or strengthen product lines.

 

July's Semicon West will be a virtual event with pre-recorded as well as on demand content with a simulated on-line Moscone Center. Registration opens May 18.

 

Shanghai's SEMICON China rescheduled to June 27-29 will most likely be a "regional" event.

 

Taiwan Semiconductor Manufacturing (TSMC) is reported to be set to announce plans to build an advanced chip factory in Arizona as U.S. concerns grow about dependence on Asia for the critical technology. The plans for the multi-billion dollar facility come as the Trump administration has sought to jump-start development of new chip factories in the U.S.

 

 

Huawei has revealed they have spent over $23 billion on stockpiles of “essential components” (semiconductor chips) as a countermeasure to U.S. trade sanctions. 

 

NEPCON Asia scheduled for Shenzhen, China August 26-28 is now reported to be canceled.

 

Given the current political environment do you wonder why?

 

On May. 15th  the U.S. Department of Commerce (DOC) announced that it was extending the Temporary General License that allows certain transactions with Huawei Technologies for another 90 days. The license allows certain transactions despite Huawei’s placement on a blacklist that restricts U.S. suppliers from doing business with the Chinese company. The DOC said foreign foundries would be granted a 120-day grace period for chips already in production.

 

Under the new rules, foreign semiconductor makers who use American technology must obtain a U.S. license to ship Huawei-designed semiconductors to the Chinese company. 

Chip design and manufacturing equipment used in the world’s semiconductor plants is mostly U.S.-made, so the new rule affects foreign producers that sell to Huawei and affiliates including HiSilicon, which makes chips for supercomputers with scientific and military uses. 

In response China’s commerce ministry says it will take “all necessary measures” in response to new U.S. restrictions on Chinese tech giant Huawei’s ability to use American technology, calling the measures an abuse of state power and a violation of market principlesSources: Reuters & AP

 

Relocation plans

 

Apple has stepped up moving more of its iPhone production to India and Vietnam looking to better diversify manufacturing risks amid the escalating trade US-China tensions, according to supply chain sources.

 

Both Foxconn and Wistron now operate assembly lines in India to turn out iPhones for sales in the Indian market, the sources said. Wistron, already running three plants there, has recently increased the capex for its India subsidiary, Wistron InfoComm Manufacturing, to $165.3 million to support further capacity expansion in the South Asian country.

.

Apple is also planning iPhone production in Vietnam, the sources said. Foxconn has operated assembly plants in Vietnam for years, and is ready to churn out iPhones whenever required by the vendor.

Another assembly partner Pegaton is also moving to set up a plant in Vietnam, with the new facility likely to start volume production of Apple devices including iPhones in the first half of 2021.

AirPods is another major Apple device with increasing production ratio in Vietnam. Its China-based assemblers Luxshare Precision Industry and Goertek have relocated production lines to the Southeast Asian country, and Taiwan-based Inventec reportedly has also disclosed plans to set up assembly lines there for smart wearable devices.  Source:Digitimes

 

Taiwan

 

The TPCA reported that circuit shipments in March rebounded 45% from February to $1.7 billion. Flexible circuits bounced back 162% with ZD Technology rebounding 222%. 

 

Taiwan Flex has developed transparent flexible circuits with transparent conductors by screen printing transparent conductive inks onto transparent polyimide film.

 

United Microelectronics (UMC) has reported revenues climbed to a record high of $504.6 million in April 2020, while Vanguard International Semiconductor’s (VIS) revenue slid to a three-month low of $86.3 million.

UMC’s April revenues represented a 3.4% sequential increase and a 24.6% surge compared to April 2019. The company credited its positive performance to strong demand for computer peripherals and consumer electronics products.*

 

Flexible PCB specialist Zhen Ding Technology saw its net profit surge nearly 100% on year to $42.2 million in the first quarter of 2020.*

 

The coronavirus pandemic may force many Taiwan-based PCB makers to slow down their capacity expansion plans in the short term due to uncertain market prospects, but Zhen Ding Technology and Unimicron seem unaffected and will see their capital expenses hit new highs again in 2020 seeking to further strengthen their market and technology leaderships over peers in the longer term, according to industry sources.

The sources said Zhen Ding’s capex for 2020 is likely to double from 2019 to $670.15 million to strengthen deployments in more technology-intensive PCB offerings after having become the world’s top vendor of flexible boards, aiming to provide one-stop shopping services for global clients in the long term.*

 

Flexible boards now contribute around 80% of Zhen Ding’s annual revenues. In this segment, the company has played an increasingly important role in the supply chain for Apple devices, especially after Japanese peers gradually cutting handset applications, the sources said.*

 

Company chairman Charles Shen has said Zhen Ding will be more aggressive in 2020 developing applications for rigid boards, a segment with great growth room for the company. It has developed good manufacturing capability for SLP (substrate-like PCB), rigid-flex boards, HDI boards and traditional multi-layer boards, but their business scales remain smaller than flexible boards.*

 

Besides the handset segment, Zhen Ding is particularly concerned about automotive applications, zeroing in on high-end automotive modules and seeking to gain from the growing trend for flexible boards to replace traditional auto-use flat flexible cables.*

 

Zhen Ding has acquired Taiwan-based niche PCB maker BoardTek Electronics, now a leading automotive radar PCB supplier in the world and capable of manufacturing high-frequency multi-layer boards. The acquisition will enable Zhen Ding to venture into high-end automotive modules segments and join 5G infrastructure supply chains while fast entering volume production of high-frequency rigid boards.*

 

Zhen Ding has also stepped up development of IC substrates. The firm has established IC substrate production lines at its affiliated Leading Interconnect Semiconductor in China’s Shenzhen, initially focusing on production of slim BT substrates for WBCSP and FCCSP packaging processes. *Source: Digitimes

 

Apple will expand its investment in Taiwan by building a new plant in the Longtan section of Hsinchu Science Park (HSP), northern where it currently has operations.

Taiwan’s Chinese language Economic Daily News reported that the investment is expected to be about $334 million.

Apple is said to be planning to team up with Taiwan-based LED lighting maker Epistar and flat panel maker AU Optornics in monitor development in a bid to reduce the company's dependence on Japanese and South Korean suppliers.

 

Japan

 

Oki Cable, an FPC maker in Japan has developed a new expandable flexible circuit,with copper traces built on urethane sheet. 

 

Mitsui Metal Smelting has started supplying in volume ultra thin copper foil (1.5 ~ 6 micron thick) on a carrier foil (designated “MT-GN”) for sub-6GHz band printed circuits.

 

Ibiden has invested $1.2 billion in its Ogaki Plant to increase its manufacturing capacity of semiconductor substrates.

 

China

 

The International Electronics Circuit Exhibit (Shanghai) co-sponsored by the HKPCA (Hong Kong Printed Circuit Association) and the CPCA (China Printed Circuit Association) scheduled to be held June 22-24 has been postponed and will now be held August 25-27.

 

5G

 

Huawei has built 200,000 5G base stations so far in China and the number is set to hit 800,000 by 2020 covering over 340 cities, according to company’s wireless network vice president Gan Bin.

 

Some industry observers indicated that Huawei’s 2020 5G base station roadmap was basically finalized in the second half of 2019, allowing it to stockpile needed materials in advance, while the new rules still offers a grace period before its implementation. Related data shows that the inventory on hand at Huawei will be sufficient for it to deliver up to 1.5 million 5G base stations in 2020.

 

The company has been placing orders for its 5G base station chips, the Huawei Tiangang, with TSMC, built using a 7nm process.

 

So far, Huawei has spearheaded in 5G technology development in terms of the number of patents it has. According to data from IPlytics, as of January 1, 2020, the number of patent claims worldwide for 5G standard totaled 21,571, including Huawei’s 3,147, Samsung Electronics’ 2,795, ZTE’s 2,561, LG Electronics’ 2,300, Nokia’s 2,149 and Ericsson’s 1,494.

 

June 2020

 

Don't get caught flat-footed again! Plan to attend the IPC Raymond E. Pritchard Hall of Fame's Management Forum January 25, 2021 and learn how suppliers, fabricators, EMS, and Contract Manufacturers responded to the unespected corona virus economic  disruption, the actions they took to survive, and their plans to meet future business impediments caused by unexpected events.

 

Click on the following link for a preview.

 

https://blog.ipc.org/2020/06/18/new-opportunity-for-managers-announced-special-attention-to-emerging-managers/ 

 

Atotech will participate in this year’s SEMICON China, held at the Shanghai New International Expo Center from June 27 – 29. 

Atotech's booth will feature:

  • Spherolyte® Cu UF3 – high-purity ECD Copper process that enables high-speed plating of pure Copper for pillar applications.
  • Xenolyte® Zincate CFA2 – universal pretreatment process for all types of Aluminum and Aluminum alloy wafers.
  • Xenolyte® Pd HS – pure Palladium deposits for high-reliability pad metallization and RDL housing.
  • MultiPlate® ECD system for power IC – simultaneous Copper deposition for embedding power chips.
  • NEAP X.1 / X.2 – next generation through-hole and blind micro via filling process for use in VCP systems with insoluble anodes.

 

NextFlex has secured seven years of government funding worth up to $154M in a cost-sharing agreement with the Air Force Research Laboratory (AFRL). The seven-year agreement also includes funding from the Office of the Secretary of Defense’s (OSD) Manufacturing Technology program, which focuses on cross-cutting defense manufacturing needs.

 

The Surface Mount Technology Association (SMTA) announced that its annual conference and exhibition, SMTA International, will proceed for 2020 as a completely virtual event September 28-30, 2020.

 

Taiwan Semiconductor Manufacturing (TSMC), which announced that it will build a $12 billion plant in AZ is seeking state and federal aid to cover the differential in manufacturing costs between Taiwan and the U.S. Construction is slated to start in 2021. The facility will create 1,600 new jobs.

 

 

TSMC reported that the U.S. approved 99% of its patent applications last year.  The company said that it secured about 3,600 patents worldwide, including more than 2,300 in the U.S. last year. As of the end year-year, TSMC had filed more than 55,000 patent applications worldwide.

The chipmaker, which has a more than 50% share of the world’s pure wafer foundry business, spent $2.96 billion on R&D, a new high. The expenses amounted to about 8.5% of TSMC’s total sales last year. The company stated that it expects its R&D spending would equal 8.5% of its annual revenue until 2030.

TSMC reported record-high sales last year of $36.3 billion, and forecast that sales this year would grow 14 to 19%.

 

The Wall Street Journal reported early this month that the Semiconductor Industry Association, the trade group that represents Intel and other U.S. chip companies plans to ask the federal government for $37 billion to build chip plants in the U.S.

 

Europe

 

The German government will commit millions of euros in funding to electronics research and development as part of a wider effort to reduce reliance on imports of equipment used in its critical infrastructure.
Berlin has resisted U.S. calls to exclude Chinese vendor
 Huawei from its telecoms networks on national security grounds, but the ensuing debate has raised awareness that its technology shortcomings pose a threat in their own right.  “It’s important for us to maintain our international competitiveness and our sovereignty in these key technologies,” said Research Minister Anja KarliczekSource: Reuters

 

Dateline June 20, Nikkei: Japan material makers are scrambling to tap the 5G bonanza

 

Japan’s materials makers are pouring money into development and output of cutting-edge products essential to the expanded use of 5G including substances that reduce signal loss and devices to facilitate data transmission in high-frequency bands.

 

5G uses millimeter wave, which falls in the 28-gigahertz spectrum. Many carriers, however, have started 5G services in the so-called sub-6 spectrum, or below 6 gigahertz, frequencies, and plan to expand into millimeter wave in the next few years.

Millimeter wave 5G can achieve transmission speeds 100 times faster than 4G, but requires special devices created with advanced electronic materials.

 

One such substance is copper-clad laminates, or CCL. Japan’s AGC*, a major producer of the laminate of copper and nonconducting resin, says that when used with the company’s fluororesin in printed circuit boards, the laminate can reduce signal loss in 5G networks by more than 30%. AGC plans to expand production of CCLs, aiming to triple sales of overall 5G-related materials to about $559 million by 2025. Demand for window-mounted antennas and heat dissipation powder is also seen as growing markets. 

 

AGC has also developed a small, lightweight glass antenna for 5G networks. Pasted on a windshield, it establishes communication with nearby base stations and electronic devices in the car.

 

AGC has also teamed up with NTT Docomo to develop another glass antenna that can work as a base station when attached to window panes in office buildings. The company has already built a plant to mass produce those products and plans to promote them across Japan by the end of the year.

 

Semiconductors used in base stations and other 5G equipment also discharge more heat due to their dense wiring and high-speed transmission, increasing demand for heat-dissipation powder. Tokyo’s Tokuyama has invested some $28 million to boost its annual capacity to produce high-purity aluminum nitride powder by 40% to some 840 tons. 

 

*AGC (formerly Asahi Glass) purchased the business of America's NELCO brand of CCL's last year.

 

Other Asian high-end CCL makers are also expanding to meet surging demand due to surging 5g needs

 

Panasonic will invest $75 million to boost the capacity by 50% at its Guangong China facility by the 2nd half of 2021 to expand its high-frequency and high-speed CCL production capacity.  Huawei is one of its major customers.

 

Taiwan’s three leading CCL makers are also aggressively moving to expand their capacity. Elite Material is also expected to roll out new capacity in the second half of 2020 to fulfill orders in hands that have outstripped its current production capacity. Iteq’s new plant in China’s Jiangxi province will become operational in the third quarter, One-quarter late due to the coronavirus outbreak. Taiwan Union Technology will also have added capacity next year. Source: Digitimes

 

The TPCA (Taiwan Circuit Board Association) released production and sales data for the first quarter of 2020. Statistics show that the Taiwanese businessmen’s PCB industry output in the first quarter reached approximately $4.541 billion, a slight increase from the same period last year. With a growth of 0.5%, Taiwanese businessmen account for about 60.7% of the mainland’s production.

 

TPCA said that the total output value of the Taiwanese cross-strait circuit board industry in the first quarter did not seem to be affected by the global epidemic situation, mainly due to the mastery of high-end products. Judging from the product structure in the first quarter, infrastructure such as 5G base stations and large data centers are not affected by the epidemic, and will continue to build in the second half of 2019. The demand for high-end computing chips and high-speed memory continues to be expected, driving ABF carrier boards. Maintaining strong shipment momentum, the annual growth rate of IC carrier boards ranks first among all types of products at 18.6%.

 

Fuji Chimera Research Institute sees the market for 5G-related electronics devices to increase 7.4-fold to $244 billion.

 

Breaking up is hard to do

 

Spooked by coronavirus-induced supply chain factory shutdowns in China, Japan's Economy Minister Yasutoshi Nishimura said, “We have become dependent on China. We need to make supply chains more robust and diverse, broadening our supply sources and increasing domestic production.”

 

However, many Japanese firms say shifting output back home is simply impractical and uneconomical. They need to be physically present in China because much of what they are making is ultimately for the Chinese consumer, and to meet the demands of ‘just-in-time’ production which prioritizes short delivery times for efficient manufacturing.

 

“Where the software is developed dictates where the hardware is developed and made,” said an official at a Japanese parts supplier, speaking on condition of anonymity. “The new government incentive is misguided if it only focuses on bringing manufacturing back, while overlooking R&D functions.”

 

The near total shutdown of China’s factories in February as the world’s No. 2 economy rammed Japan’s China dependence home. In addition to the government’s $2 billion offered subsidies to bring back manufacturing, Japan is also offering $220 million to Japanese firms to strengthen and diversify supply chains in Southeast Asia.

 

July 2020

 

Don't think outside the box, design and build a new box - or a sphere! The new digital world demands it!

 

Are American fabricators really ready to accept and process large volume orders? Should they? We have heard some new horror stories about attempts to move volume orders from China to smaller" U.S. operations. The reports include no response to inquiries, late deliveries, quotations with errors and more.

 

The questions now are:

 

  • Has the U.S. PCB industry been too badly gutted for too long in order to recover?
  • Are there enough investors willing to rebuild the industry in North America?
  • What is the best path for North America's smaller EMS companies to enter the digital world of AI, XR, security demands, digital data collection, analytics, and automation leading to factory 4.0?
  • Will they be able to raise the requisite funding?
  • Do there investors have a long range vision?
  • How will supply chains be modified and managed?
  • How will they locate skilled and semiskilled labor, or retrain and upgrade existing employees?
  • Will the industry be totally dominated by a few larger operations?
  • What new business models rise to meet the challenge?
  • Will the new business models be regional rather than global?
  • Will new special services rise to meet the needs?
  • Shall we look to Europe for cooperative innovation to replace the cheap prices (and manufacturing technology) of the Far East??

 

Covid-19 has forever changed how we run our businesses. It seems that EVERYBODY now has a new Webinar or Zoom presentation That I MUST SEE in order to survive! There are so many of these offers on a daily basis that they have become a nuisance!

 

The ever changing political climate and new regulations will create losses as well as gains. I am assessing these and their potential effect as I Zoom around the world from my home office. Negotiating face-to-face via the internet certainly has its challenges. Having established personal relationships in the past certainly helps. But, I still wonder what nuances I am missing by remote negotiations and discussions.

 

We are going to address many of the aforementioned issues in January - hopefully in the "real world"! Watch for announcements for the January 25, 2021 IPC Hall of Fame Management Forum at IPC APEX EXPO 2021.

 

Taiwan

 

Taiwan’s Ministry of Economic Affairs (MOEA) is implementing a 3-year (January 2019 to December 2021) incentive program to encourage Taiwanese enterprises that have invested in China for over two years to return and make investment domestically amid US-China trade tensions. As of July 24, 2020, the ministry has approved applications of 195 companies with a total investment amount of $893 million and a creation of 64,232 jobs, according to minister Mei-hua Wang.

 

For Taiwanese enterprises not qualified to the program aforementioned or having not invested in China, MOEA is implanting a 2.5-year (July 2019 to December 2021) program to encourage large members of the group to invest in Taiwan and another 2.5-year program of the same kind to small- to medium-size members.

 

As of July 24, 78 large enterprises have been approved with total proposed investments of $5.3 billion and 12,127 jobs created; and 304 small- to medium-size enterprises with total proposed investment of $4.3 billion and 12,067 jobs created.

 

Taiwan-based IC substrate suppliers including Unimicron Technology and Nan Ya PCB are expected to continue experiencing tight supply of ABS substrates throughout 2020 despite losses of orders from Huawei, but their profitability may fall slightly.

 

Unimicron Technology will spend $594.2 million in capex for 2021, with over 90% of the sum and the majority of its 2020 budget on IC substrate business.

Unimicron is slated to complete construction of a new plant in Yangmei, northern Taiwan by the end of this year in preparation of starting commercial production of IC substrates in early 2022 for Intel.

The new plant will be dedicated to production of ABF substrates to support the Intel’s advanced EMIB (embedded multi-die interconnect bridge) packaging process for its chips.

A recent fire that broke out at one of Nittobo's plants in Fukushima, Japan is expected to impact the already-tight supply of ABF substrates worldwide and push up quotes for them.

Schmid’s main factory in China will move out 40km out of the free trade zone in Zhuhai into newly built factory in Zhongshan. The new site will be 100% operational by November 2020.  SCHMID said that it made this strategic move to increase its commitment to China with a dedicated equipment fab in China for China.

 

Japan’s materials makers are pouring money into development and output of cutting-edge products essential to the expanded use of 5G including substances that cut signal loss and devices to facilitate data transmission in high-frequency bands.

 

Millimeter wave 5G can achieve transmission speeds 100 times faster than 4G, but requires special devices created with advanced electronic materials. One such substance is copper-clad laminates, or CCL.

 

Japan’s AGC, a major producer of the laminate of copper and nonconducting resin, says that when used with the company’s fluororesin in printed circuit boards, the laminate can reduce signal loss in 5G networks by more than 30%. AGC plans to expand production of CCLs, with a goal of  overall 5G-related materials sales of about $559 million by 2025.

 

Japan's Fuji Chimera Research Institute sees the market for 5G-related electronics devices to increase 7.4-fold to 26.14 trillion yen.

 

From the PRC

 

The three-day productronica China 2020 event held early this month in conjunction with electronica China 2020, had 1,373 exhibitors which drew 81,126 visitors signaling the start of a recovery of the electronics manufacturing industry from the impact of the Covid-19 pandemic earlier this year.

 

Leading SMT exhibitors, included Panasonic, Yamaha, REHM, Zestron, Eternal, Takaya, Scienscope, Electrolube, and MacDermid Alpha.

 

Companies offering new smart factory solutions for electronic manufacturing included robot companies from China and abroad, such as Universal Robots, HIWIN, JAKA, Elite, Aubo, IPLUS Mobot, Standard Robots, and Youibot.

productronica China 2020 included a platform for dispensing and adhesive technology which included: Henkel, H.B.Fuller, Wanhua Chemical, Wevo-Chemi, Scheugenpflug, Hoenle, Plasmatreat, Marco, DOPAG , Nordson, and PVA.

 

The show even included a copy of the IPC’s hand soldering competitions!

 

Chinese homegrown assembly and box building companies are posing a growing challenge

 

Local electronics titan Luxshare Precision Industry Co. is poised to become the first Chinese homegrown iPhone assembler after sealing a deal in July to buy an Apple handset production plant from Wistron Corporation. While Hon Hai (Foxconn) will keep assembly orders for premium iPhones, Luxshare will eat into the business for mid-to-entry-level Apple handsets according to Fubon Securities analyst Arthur Liao.

 

On the home front

 

Summit Interconnect has acquired Integrated Technology Ltd. (ITL Circuits) the oldest and largest privately held PCB manufacturer in Canada, ITL Circuits provides a significant expansion of Summit’s operations in North America.

 

ITL Circuits is AS9100, NADCAP and MIL-PRF 31032 certified and has a long history of servicing military programs for the Canadian Department of National Defense (DND) prime contractors and Australian Defense Force (ADF) primes.  ITL Circuits is also a long time supplier to the United States DOD prime contractors under U.S. ITAR 126.5 under the Canadian Controlled Goods (CGP) exemption.

 

Shane Whiteside, President and CEO of Summit Interconnect, Inc. stated, “ITL’s capabilities complement Summit’s and will provide additional volume manufacturing capacity across a broad range of technology.” 

 

August 2020

 

Are domains national or corporate or industry? Semi, like the IPC, has expanded the description of its sphere of influence.

SEMI, the industry association serving the global electronics design and manufacturing supply chain, released the following statement in response to the new export control rule changes announced by the United States Commerce Department.

 

"SEMI recognizes the role of export control measures to address threats to U.S. national security. However, we are very concerned the new export control regulations issued on August 17, 2020, by the U.S. Department of Commerce will ultimately undermine U.S. national security interests by harming the semiconductor industry in the U.S. and creating substantial uncertainty and disruption in the semiconductor supply chain. On July 14, in public comments on the May 15 regulations, SEMI cautioned that those relatively narrow actions created unique disincentives to purchase U.S.-origin semiconductor equipment and design software and had already resulted in $17 million lost sales of U.S-origin items to firms unrelated to Huawei.

 

Commerce’s decision to significantly expand these unilateral restrictions will likely lead to more lost sales, eroding the customer base for U.S-origin items. The new restrictions will also fuel a perception that the supply of U.S. technology is unreliable and lead non-U.S. customers to call for the design-out of U.S. technology. Meanwhile, these actions further incentivize efforts to supplant these U.S. technologies.

 

SEMI respectfully requests Commerce immediately extend to 120 days the savings clause for items in production before August 17, ensure predictable and timely license decisions for all items and significant flexibility for licenses unrelated to 5G items. We also urge the administration to pursue policies with fewer unintended consequences and damage to U.S. technology leadership. Revenue from global sales is a major source of U.S. research and development (R&D) funding in these technologies; lost global revenue will lead to a decrease in R&D, undermining U.S. semiconductor innovation and thereby harming national security."

 

Going forward

 

There are bumps in the road to recovery. They include scheduling labor and support engineering for production lines, budgeting for changes in Covid-19 era operations, adjusting production schedules and procedures, avoiding/reducing the flow of red ink, and rationalizing direct and contract staff - all this as we attempt to determine what the new buzzword "upskilling" means to us. Where is it needed? How do we identify the staff that needs training as we limp into this digital world? Who can we provide what we need? How do we verify it? That resurrects and heightens the need for trust. Where do we go and how do we determine trusted partners for future collaboration and upskilling?

 

SOS?

 

Sanmina Corporation has announced that Jure Sola, the company's co-founder and Executive Chairman, will reassume the Chairman and CEO position to lead Sanmina through its next strategic phase during the ongoing pandemic and uncertainty in the macroeconomic environment. Chief Executive Officer (CEO)  Hartmut Liebelleft after less than 11 months on the job.

 

To align with Sanmina's new vision of maximizing shareholder value, the company plans to organize into three segments – Integrated Manufacturing Solutions (IMS), SCI (defense products and system builds) and Components Technology (advanced interconnect technology and mechanical systems). Sanmina will provide further details on its fourth quarter earnings call.

 

Continued moves  from China by Taiwan flexible circuit makers

 

Zhen Ding Technology plans to set up a new plant in Southern Taiwan Science Park at a cost of more than $680 million pending government approval. It will be dedicated to production for high-end applications with capacity equal to that of its major production plants in China. The company has also set up a new plant in India to handle backend module assembly.

 

Flexium Interconnect is stepping up construction of a new plant in Kaohsiung, southern Taiwan for production of LCP (liquid crystal polymer)-based flexible antenna boards for 5G iPhones.

 

Makers of PCBs for networking and server applications have also moved to set up production plants in Southeast Asia to mitigate possible impacts of US-China trade tensions  according to the Digitimes.

 

3nm and 2 nm nodes? That is almost beyond my imagination

 

Taipei's August 21 Digitimes had a news item by Jesse Shen that boggles the mind. It reported that TSMC's online technology symposium on August 25 will provide updates about ite advanced process technology including 3nm and 2nm process nodes, as well as its extended 5nm process family.

 

TSMC will also demonstrate its advanced packaging technology, particularly its latest 3D SoIC packaging technology that will be ready for volume production in 2021. The contract chipmaker has already moved its EUV-based 5nm process technology to volume production.

 

In addition, the company continues to advance its wafer-level packaging technology with new-generation CoWoS and InFO, while also pursuing more advanced and multi-function packaging technologies for heterogeneous chips. In particular, the foundry has made progress in the development of 3D heterogeneous integration technology to support proliferating 5G, AI, IoT, and automotive electronics applications.

 

Dateline: Aug. 11th, 2020

 

Goods made in Hong Kong for export to the United States will need to be labelled as made in China after Sept. 25, according to a U.S. government notice. The move follows China’s imposition of a national security law on Hong Kong and a U.S. decision to end the former British colony’s special status under U.S. law.

 

The latest step will see Hong Kong companies subject to the same trade war tariffs levied on mainland Chinese exporters, should they make products subject to these duties, said the U.S. Customs and Border Protection notice. It said that 45 days after its publication, goods “must be marked to indicate that their origin is ‘China’”. Source: Reuters

 

Taiwan

 

Nan Ya PCB saw its net profits soar nearly 80% sequentially to $28.36 million in the second quarter of 2020, a sharp improvement from operating losses seen last year. earlier, according to industry sources. The gains were the result of strong shipments of both ABF and BT substrates.

 

ABF substrates contributed over 40% of Na Ya’s revenues, compared with 30% for BT substrates and the remainder for other PCB products. Nan Ya PCB maintained full capacity utilization for ABF substrates in the second quarter and expects to do so in the third quarter on applications for new HPC chips.

Its capacity utilization for BT substrates will ramp up to 95% in the third quarter from 80% due primarioly to increasing shipments of BT-based SiP substrates for handset camera modules and Apple WatchSource: Digitimes

 

The U.S. Department of Commerce announced new sanctions on August 17 eliminate Huawei's access to advanced computer chipsThese restrict any foreign semiconductor company from selling chips developed or produced using U.S. software or technology to Huawei, without first obtaining a license to do so.

 

Earlier restrictions limits companies such as Taiwan Semiconductor (TSMC) from providing Huawei with chips designed by HiSilicon. The new restriction extends the ban to all chip designers incuding Taiwan's MediaTek.
 
The pirating solution?
 

Quanxin Integrated Circuit Manufacturing (Jinan), better known as QXIC, and Wuhan Hongxin Semiconductor Manufacting, or HSMC, have each employed more than 50 former Taiwan Semiconductor Manufacturing (TSMC} veteran engineers and managers since last year. Both are also led by ex-TSMC executives with established reputations in the chip world. They aim to develop 14-nanometer and 12-nanometer chip process technologies, which are two to three generations behind TSMC but still the most cutting-edge in China. Both companies are backed by China's government.

 

Hongxin and QXIC, founded in 2017 and 2019 respectively and government backed,  are part of a recent boom in China’s semiconductor industry as Beijing prioritizes self-sufficiency in key tech areas impacted by tensions with Washington. Source: Nikkei Asian Review

 

Not so rare a move these days

 

In the wake of supply disruptions of certain metals caused by the covid-19 pandemic, Japan has decided to ramp up government control over strategic reserves of 34 rare metals and increasing inventories of some strategically important metals such as cobalt.

 

The Ministry of Economy, Trade and Industry urged more flexibility in determining inventory levels for each rare metal, after taking into account their strategic importance, geopolitical risks and domestic demand. For national security considerations, the department asked the Shinzo Abe cabinet to keep inventory targets and actual stockpile levels secret.

 

“Japan has designated 34 ‘rare metals’ – including rare earths – as having the potential for stockpiling and currently holds reserves of seven — nickel, chrome, tungsten, cobalt, molybdenum, manganese and vanadium,”  according to an Argus report.

 

Japan has also been securing its external supply of rare earths. Back in June 2019, Japan Australia Rare Earths BV (JARE), a joint venture between state-owned Japan Oil, Gas and Metals National Corporation (JOGMEC) and Sojitz Corporation, approved a generous financing package for Australia’s Lynas Corporation, expanding the country’s control over the company’s rare earths output.

 

The deal was signed amid China’s threats to use its market supply dominance as a weapon in the trade war with the United States.

 

September 2020

 

Think! - Nothing is forever

 

109 year old IBM will split into 2 separate public companies by the end of next year to focus on high margin cloud computing. Last year the comopany spent $34 billion to buy the cloud company Red Hat.

 

France first?

 

France has announced a €100 billion Recovery Plan to encourage the reshoring and strengthening of key sectors including electronics manufacturing. A call for specific investment proposals trecently announced will be open through November 17. Projects targeting the strengthening of electronic manufacturing companies' capacity to respond to crisis situations will be given priority. There are 13 criteria that businesses must meet to qualify for financial support. The list of qualifying activities includes:

  • The creation of new production units;
  • Investments in existing production units to make them more productive and flexible;
  • The development and implementation of new technologies on an industrial scale; and
  • Manufacturing of printed circuit boards, as well as assembly services

Where are the trusted suppliers? - shocking news

 

Did you know that there are currently only 3 CCL (copper clad laminate) and porepreg suppliers in the world that have been passed IPC Validation Services QPL (https://ipcvalidation.org) to meet IPC-1401C and be listed as a trusted supplier?

 

How does one put together a long range plan to cover not just survivability but also growth while assuring commensurate appropriate cash flow? Doing nothing is NOT an option. Random business fluctuations during COVID-19 surges coupled with political uncertainties and unrest require flexibility while staying the course. I consider the strengthening of the most valuable resource, your organization's employees, to be of paramount importance. Enhanced training and upskilling to bring businesses solidly into the digital world. This should be coupled with the use of AI and analytics to aid in decision making, monitor operations, balance inventories, review and control supply chains, and increase your digital presence and capabilities.

 

Taiwan’s government will invest up to $ 1.709 billion in 5G infrastructure construction in the next five years, according to vice president William Lai. For the next few years much of the interconnect world will be engaged in developing systems that utilize advanced packaging to take advantage of chips with <10nm nodes. We’ll see the greater use of SoICs, 1 1/2/3D packages, as well as new fan out substrate processes.

 

MOEA Department of Statistics Deputy Chief Huang Wei-chieh said the strong showing in the industrial production came about as electronic component exporters, in particular in the semiconductor industry, saw their shipments rising to meet demand for emerging technologies such as 5G applications and high-performance computing (HPC) devices.

 

Moreover, Huang said, rising popularity in online work and remote learning gave an additional boost to global demand for notebook and tablet computers, as well as servers.

 

In August, production of electronic component suppliers in Taiwan rose 17.9% from a year earlier, marking the ninth straight month of double-digit increase, with production generated by semiconductor makers up 22.9%, the MOEA went on.

 

From the TPCA

 

Affected by the sharp drop in orders from Huawei, Xinggui PCB Plants announced that all production lines at its Taiwan plant will cease production This will affect approximately 50% of consolidated revenue. The closure was attributed to the U.S.-China trade war coupled with the ban on doing business with Huawei. A $6.1 million impairment loss is expected from the closure.

 

The ABF substrate capacitiess of Taiwan-based Unimicron, Nan Ya PCB, and Kinsus Interconnect Technology are fully booked through the first half of 2021 due to strong demand for processing high-performance CPU, GPU, AI and networking chips.

 

U.S. chipmakers AMD and Nvidia have advanced big orders for ABF substrates with Taiwanese suppliers as part of their efforts to expand market shares in the CPU and GPU segments amid the lingering shortages of Intel processors. Chinese vendors of processors have also significantly strengthened their partnerships with Taiwanese IC substrate makers in line with the country’s de-Americanization campaign concerning semiconductor supply.

 

Suppliers of 5G base station and networking chipsets have also rushed to place additional orders for ABF substrates with their Taiwanese partners looking to gain more market shares in the wake of Huawei/HiSilicon losing ground amid tough U.S. trade sanctions. FPGA chips vendor Xilinx, for instance, is seeking more capacity support from its existing partners Unimicron and Kinsus, with Na Ya also to become its new ABF substrate supplier.

 

Unimicron is building a new plant which will focus on production of substrates to support advanced packaging of Intel’s chips solutions. 

 

Na Ya has signed six-month supply orders with most of its ABF substrate clients, and will give priority to orders with higher gross margins before new capacity becomes available in 2021. Nan Ya estimates that demand for ABF substrates with 12+ layers will surpass 30% ofthese substrates next year.

 

Kinsus is reported to be ready to install ABF substrate equipment at its new plant in Taiwan to meet its increasingly strong demand from Xilinx and Nvidia.

 

Meanwhile, U.S. August 2020 PCB book-to-bill ratios declined to 0.94 as shipments declined 2.5% from last August.

 

Almost beyond imagination

 

TSMC’s development of 2nm process technology is ahead of schedule. The process will adopt GAA (gate-all-around) transistors in place of FinFET. The foundry is expected to move its 2nm GAA process to volume production in the second half of 2023.

 

TSMC had previously said that it will continue using FinFET transistor structure for its N3 (namely 3nm process) technology, but has not disclosed details about its 2nm process. The foundry is scheduled to move N3 to mass production in the second half of 2022. Source: Digitimes

 

Electronic packaging

 

The semiconductor industry is stepping up its efforts in advanced packaging, an approach that is becoming more widespread with new and complex chip designs.

 

Foundries, OSATs and others are rolling out the next wave of advanced packaging technologies, such as 2.5D/3D, chiplets and fan-out, and they are developing more exotic packaging technologies that promise to improve performance, reduce power, and improve time to market. Each package type is different, with various tradeoffs. As before, the idea behind advanced packaging is to assemble complex dies in a package, creating a system-level design. But advanced packaging faces some technical and cost challenges.

 

Today, though, advanced packaging is becoming a more viable option to develop a complex chip design for several reasons. Typically, to advance a design, the industry develops a system-on-a-chip (SoC) using chip scaling to fit different functions onto a single monolithic die. But scaling is becoming more difficult and expensive at each node, and not everything benefits from scaling.

 

Samsung and TSMC, the two other leading-edge chipmakers, are moving ahead with chip scaling at 5nm and beyond. But Samsung and TSMC, as well as other foundries, also are expanding their packaging efforts. And the OSATs, which provide third-party packaging services, continue to develop new advanced packages.

 

Advanced packaging won’t solve every problem in chip design. Chip scaling still remains an option. What’s changing, though, is that new package technologies are more competitive.

 

No one package type can meet all needs. So, vendors are developing several types. Here are some of the latest technologies:

  • ASE and TSMC are developing fan-out with silicon bridges. Fan-out is used to integrate dies in a package, and bridges provide the connections from one die to another.
  • TSMC is developing silicon bridges for 2.5D, a high-end die stacking technology.
  • Several companies are developing chiplets, a way to integrate dies and connect them in a package. Intel and others are developing new die-to-die interconnect specs for chiplets.
  • The Optical Internetworking Forum (OIF) is developing new die-to-die specs for chiplets, enabling new communications designs.

Scaling remains an option for new designs, although many are searching for alternatives like advanced packaging. “The momentum is driving more customers in more applications to explore alternative solutions than large, single-die solutions on expensive bleeding-edge silicon,” said Walter Ng, vice president of business development at UMC. “We always will be moving in a direction of needing more complex functionality. That typically means larger chips. We’ve always managed that with the ability to migrate to the next technology node, which has come with the same challenges of cost and power. We are at the point now where that ability begins to no longer be feasible and alternative solutions are becoming a must. Advanced packaging solutions, coupled with innovative interconnect approaches, are providing some of those attractive alternatives. But we need to keep in mind that the chip economics involved will determine the ultimate implementation.”

 

For decades, packaging was an afterthought. It simply encapsulated a die. And in the manufacturing flow, chipmakers process chips on a wafer in the fab. Then, the chips are diced and assembled in simple conventional packages. Conventional packages are mature and inexpensive, but they are limited in electrical performance and interconnect density. That’s where advanced packaging fits in. It enables higher performance with more I/Os in systems. Source: Excerpted from aricle by Mark Lapedus in Semiconductor Engineering

 

 

Apple says that it will be the first to use TSMC’s  five nanometer process technology, with 11.8 billion transistors packed into the chip, up 40% on its previous generation seven nanometer chips. It will provife to 11 trillion operations per second!

 

The new more efficient chip will provide more power with less battery consumption, run more processes in parallel across a six-core design. The compoany says that the new chip will provide speeds three times faster than the fastest Android tablet.

 

Even with a trade war and a global pandemic

 

China posted a trade surplus of $58.93 billion in August. China’s exports in August increased by 9.5% from a year earlier while total imports dropped 2.3%  to  $1.3 trillion.

 

Imports of integrated circuits rose rapidly during the first eight months of the year, buoyed by a rebound in market demand, said Gao Feng, spokesperson for the Ministry of Commerce (MoC). They jumped 15.3% year on year to $219.52 billion between January and August. 

 

Epidemic-induced lifestyle changes, such as the increasing popularity of working from home, distance education and online health care, spurred demand for integrated circuits, Gao said. China’s 5G network construction and some companies’ rush to stock up on integrated circuits also contributed to the increase in imports, he added. Source: ATimesCN.com.

 

Messe München announced that November's  electronica 2020 will be held digitally due to increasingly stringent travel restrictions in Europe.

 

October 2020

 

While Nero Fiddles (Congress squabbles) ...

 

China has achieved its goal of building 500,000 new 5G wireless base stations in 2020 well ahead of schedule according to the Ministry of Industry and Information Technology.

The country had a total of 690,000 base stations at the end of September, up 70% from June, with more than half a million deployed this year alone. Shipments of smartphones and other devices compatible with ultrafast 5G service topped 100 million in the first nine months of 2020.

 

The city of Shenzhen,,home of Huawei' enormous research center, had achieved “full coverage” of 5G service late this past summer. The local government has partnered with Huawei and Tencent Holdings, to test industrial 5G applications. Source: Nikkei

 

Samsung Electronics's record 3rd quarter revenues of $59 billion brought a net profit of $8.3 billion up 49% over the same period in 2019. Smart phone sales increased 50%, while profits from microchips rocketed 82%. 

Samsung's increase is said to be a result of displacing Huawei's market shares as the U.S. sanctions against the Chinese telecommunications company take effect.

 

Rapid recovery?

 

Foreign direct investment (FDI) inflows into China surged 23.7% to $14.25 billion in September compared to a year ago, underlining the confidence international investors have in the world’s second biggest economy long-term prospects, despite threats of decoupling from the United States according to the South China Morning Post.

 

Total FDI inflows into China in the first nine months amounted to $103 billion. In comparison, Vietnam, which is widely seen as an alternative investment destination, attracted $21.2 billion in FDI in the first nine months of 2020, a drop of 18.9% from a year earlier.

 

China’s commerce ministry has issued a new regulation to ensure authorities are more responsive to foreign companies. As part of this effort, the ministry has asked every province to set up a hotline and a complaint processing centre for foreign businesses.

 
President Xi Jinping said that China’s new dual circulation economic strategy, which will rely more on domestic demand to power growth, does not mean it will close its market to foreign firms.  Xi Jinping vows to promote Shenzhen as global trade hub.

 

Xi also chaired a Politburo meeting which approved a regional development plan to integrate Chengdu and Chongqing into an economic hub in the southwest to optimize and stabilize value and supply chains”, according to the Xinhua news agency.

 

Meanwhile, China’s outbound investment dropped 0.6% in the first nine months from a year earlier to $78.9 billion.

 

Technology advance - new substrate material

 

Corning has introduced a new ribbon alumina laminate that is the first ceramic product that allows for conventional PCB processing — even mechanical drilling. The homogeneous laminate eliminates differential signal skew and supports very high speed signals, e.g., 5G, with very low loss tangent and dielectric constant. Applications include both PCB and package substrates. In PCBs it reduces overall CTE mismatch. As a package substrate distributes stress better.

 

Taiwan

 

Japan's Mitsubishi Gas Chemical (MGC) will form a JV with Taiwan's Iteq to make ansd sell new jointly developed copper clad laminates and prepregs for IC substrates for 5G and automotive applications. MGC will have 51% of the JV.

 

From the world's leading IC foundry

 

TSMC expects the main driver of its growth in the next several years to be high-performance computing (HPC).  New 5G and HPC orders in the 3rd quarter will increase growth by about 30% ithis year in spite of losing sales to China’s Huawei.

 

TSMC said its sales to Huawei, in 2020 its second-largest customer after Apple, will drop to zero in the fourth quarter this year in compliance with US regulations.

 

The company said the 5nm process that’s ramping up in competition with Samsung will account for about 8% of its 2020 revenue,increasing to about 20% next year. In the 7nm node, TSMC has a market share of about 88%, according to Gokul Hariharan, an analyst with JPMorgan Chase.

The company is entering a healthy growth period, setting up for a multi-year tight capacity environment particularly at the leading-edge, according to Brett Simpson with Arete Research.

 

AMD’s shifting orders from GlobalFoundries to TSMC is leading HPC demand, which is also boosted by strong gaming, AI accelerator and PC peripheral orders, according to Credit Suisse analyst Randy Abrams. IoT has also rebounded on wearable and smart home strength, with only automotive customers lagging, he said. Source: Custer Consulting Group

 

 

 

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