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Current Issue

Mike Buetow

How many greenfield fabrication plants do you think have been built in the US in the past 10 years?

I can think of three, and two of them were designed and built by the same person and corporate parent. There’s Whelen Engineering, the OEM that opened a captive shop in 2015. The brains behind that, Alex Stępiński, then designed and built GreenSource Fabrication, which launched in 2018. And perhaps we can count TTM’s new plant in Chippewa Falls, built in a converted 20-year-old, 40,000-sq. ft. warehouse and officially opened last winter.
Now we can add one more to the list. More surprising, an EMS company built it.

Last month Benchmark Electronics opened the doors to its 122,000 sq. ft. state-of-the-art factory in Phoenix. The company, the fifth largest EMS in the US and 18th in the world according to the CIRCUITS ASSEMBLY Top 50, is known for putting components on boards, not making the substrates themselves. The new venture is a leap of faith, buoyed by the desire to control the product development from end to end.

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Read more: Bench Gets Vertical

Mike Buetow

We’ve spoken at length in these pages about the virtual factory. But what about the virtual factory tour?

By this, I don’t mean the flashy, MTV-style videos found on so many company websites today. Instead, a live plant tour, executed using cameras and PCs.

I have been studying manufacturers to determine whether, in the wake of the coronavirus surge, they are noticing changes in the way customers decide where to put production, and whether that’s a permanent change or a temporary fix. According to my unscientific sample, the answers are “yes” and “we’re not sure.”

Count Teresa Huber, president and chief executive of Intervala, among those seeing changes. The EMS company, which has sites in Pennsylvania and New Hampshire, is substituting video conferencing for onsite meetings and in-person audits.

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Mike Buetow We left off last month commenting on the effects of Covid-19 on the supply chain and offering questions – and some opinions – on what might happen next. Interestingly, the real ugliness might not have hit yet. Anticipating the traditional supply drop-off during the Chinese New Year, most companies boosted inventories ahead of time. By the time China turned the lights back on, in late February/early March, the West was starting to slow, leaving stocks in a relatively decent position.

So far, so good.

Where China will feel it most, I think, is over the next two months, as Western demand lags and China’s domestic-based suppliers pull back so as not to overstuff the supply chain. Already, we are starting to see some layoffs in Southeast Asia. If that region has to sustain another wave of Covid-19, look out. The chain could be in for a wild ride.

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Mike Buetow

Remember 2010?

That year, a massive earthquake in the Pacific Ocean led to a tsunami of biblical proportions. Much of Japan’s semiconductor and electronics manufacturing industry was taken offline for nearly two months.

About 12 months later, it was Thailand’s turn in the wringer. The so-called 100-year floods swamped most of the country, causing nearly $50 billion in damage. In doing so, they took out major assembly operations at Fabrinet, Benchmark Electronics, Kimball and SVI, among others, upsetting a major link in the auto electronics and optical component supply chains.

Covid-19 has hit the electronics supply chain with all the force of those two natural disasters. The industry response will be fascinating.

This is the ultimate stress test. Coming on the heels of the Chinese New Year, where employees had not yet returned to work, the shutdown lasted four to six weeks in China. It’s a double whammy.

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