For more than 20 years, PCD&F/CIRCUITS ASSEMBLY has been proud to be the exclusive publisher of the annual NTI - 100 list of the world’s largest board fabricators.
One of the striking changes over the years has been the reshaping of the industry geographical landscape.
In this year’s rankings, which begin on page 32 of the August 2022 issue, see how many Europe- and US-based companies are in the top 25. I'll save you the suspense. One each: AT&S and TTM Technologies, respectively. Long gone are the days when Photocircuits, Sanmina, Hadco, Viasystems and the like dominated the top of the chart.
In fact, only a combined 10 companies from the two continents (combined population: 1.2 billion) broke the $100 million threshold for making the rankings. South Korea alone (population 51 million) has 14. Taiwan (population: 23 million) has 27.
Every industry goes through a maturation period. Ours is no different. As the report’s esteemed author, Dr. Hayao Nakahara, points out, the 146 companies on this year’s list are just 6% of the estimated 2,400 fabricators in the world, but they produce 92% in revenue value of the boards.
Consolidation is inevitable, and with that comes lots of pain.
As we went to press, the US Senate was gearing up to vote on the CHIPS Act, which would allocate billions in incentives to semiconductor manufacturers to build new plants in the US. Likewise, the Printed Circuit Board Association of America, a partner organization of PCEA, is working its magic to help breathe life back into the US bare board marketplace.
These are important measures, and not just because they could level the playing field for the manufacturers of critical products themselves. In fact, the fabricators and assemblers are just the top of a very large food chain, and we must consider the effects of slowdowns and shutdowns on all those suppliers, not just the companies that press together laminate and copper plies or solder components to substrates.
Take the auto industry. It is characterized by a few big OEMs. We all know the names. Toyota. Volkswagen. Honda. Ford. Hyundai. Nissan. The top 10 make up about 55% of the world’s car sales.
But the supply and distribution channels are endless – and necessary. Countless companies make metals, plastics, components, and yes, electronics for Big Auto. And even more are involved in the sales channels.
That works especially well when a market is thriving. Have you ever heard of a large company being less than easy to deal with for smaller-volume buyers? I’m guessing you have. Sellers chase margin and they chase dollars, not necessarily in that order. More than one outside salesperson has related to me about winning a program and sending it to their company to produce, only to have it rejected because it was “only a $1 million” order, not the $5 million or greater programs the company desired.
We can debate whether those salespersons erred by chasing programs that they shouldn’t have, but the point is that one size doesn’t fit all. In a healthy, vibrant market there is room for all kinds of specialists. And while the extra layer means more inventory in the chain, the irony is that is just what we do during capacity crunches like this one. What smaller fab hasn't heard the dreaded A word – allocation – from a critical material vendor? An abundance of smaller regional distys can help mitigate that.
While we are building back our manufacturing base, let’s not forget the supply and distribution chain that undergirds it.
About that manufacturing base. A large range of suppliers of printed circuit boards, materials, software and services can be seen at PCB West in October. This will be the first time PCB West will take place under the auspices of PCEA, and the staff and board couldn’t be more excited. Visit pcbwest.com to see the exhibiting companies and peruse the more than 110 hours of technical training.
Finally, we welcome our first corporate members: EMA Design Automation, Quantic Ohmega, Polar Instruments, EIConnect, Ventec and American Standard Circuits. There are many benefits to membership; for details, visit https://pcea.net/pcea-membership.