Tag Archives: electronics

A Look at the Past, A Glimpse at the Future

Posted on by

I had the pleasure of I speaking to about 20 8th graders this month about careers in electronics.

It took me back to my first real introduction to the industry: the Summer Consumer Electronics Show in 1992. There I saw the prototypes for HDTV and widescreen TVs, and more interesting, the first foldable screens.

I was enthralled with some of the devices and innovations I saw there, some of which have yet to come to mass production. They were a far cry from what I was used to at that point: floor TV models as large as a desk and computer terminals the size of small ovens.

1970s Magnavox floor model. The Buetows didn’t have this exact model, but it was close. Color, too!
The PLATO mainframe system, circa late 1970s. These terminals were linked via phone dial-up to mainframes on university campuses around the world. It also where the forerunners to features like instant messaging, email, touchscreen displays, online learning, and massive role-playing games were first rolled out.

I like to remind folks that it takes a generation or more for most ideas to become mainstream. At this year’s CES, there were transparent TVs (thanks to LG and Samsung), foldable OLED PC monitors (Asus), and a portable rolling robot projector (Samsung again) that, well, you really to see to understand what it is capable of.

ASUS foldable PC
LG transparent TV
Samsung transparent TV

Of my cohort that January morning, two of them are already thinking in terms of engineering careers, but in my opinion what’s more important is that none of them rules out this path.

Mentoring peers is great and important, but I’m a big proponent of talking to youth and helping them connect the dots. After all, we are often reminded that if you want to see the future, take a look at your kids.

And if you agree that we need the next generation to consider careers in electronics design and manufacturing, are you doing what you can to encourage them?

Grounded! What The Electronics Industry Can Learn from Airlines

Posted on by

Anyone who has boarded a plane in the past several months knows this all too well: the near-term future of airlines is up in the air.

From smallest to largest, all the carriers have been dramatically affected by the post-Covid rebound in passenger air travel. Delta and United Airlines each cut 30% of their respective staff in 2020.

And while many observers point to the attractive buyouts the carriers dangled before critical employees (read: pilots) as means to cut costs amid the mass groundings during the pandemic, employment has shot up over the past 18 months.

Take Delta, for instance. The second-largest airline in the world has hired 18,000 new employees since January 2021. But even with its staffing back to 95% of what it was pre-Covid, capacity reportedly is some 10 percentage points lower. Reason: it takes time to train the newbies.

“The chief issue we’re working through is not hiring but a training and experience bubble,” said Ed Bastian, CEO, Delta.

And the more complicated the job, the longer the training period. Which reveals yet another crack in the fuselage: a lack of trainers. To wit: American says its pilots are basically stuck waiting for training classes to open up, as the number of new hires far outpaces the available slots. The backlog is said to be six months or more.

The issue runs so deep, it has its own name: the Juniority problem.

United has gone on the offensive, blaming — who else? — the government. United chief operating officer Jon Roitman estimates “over 50% of our delay minutes and 75% of our cancels in the past four months were because of FAA traffic management initiatives.”

But all this comes back to the industry’s lack of foresight — or unwillingness — to continue to invest in its workers during the inevitable economic cycles.

You know where I’m going with this.

The PCB industry is historically boom/bust. We are coming off a run of very strong years, and the forecast, according to Dr. Hayao Nakahara, the preeminent researcher in the industry, continues to look bright.

But the graying of the industry is very real, and its long past time OEMs invested in recruiting and training the next generation of designers, design engineers and manufacturing engineers. (And yes, I am pointing at OEMs, since they are top the of the pyramid and ultimately their needs are the driver for the rest of the supply chain’s decision-making.

Let’s learn from the airlines, or, more precisely, their mistakes. It’s time for the push to onboard the next generation of engineers to take flight.

Trouble in India

Posted on by

The riots at a Wistron plant in Narasapura could have lingering effects long after the damage is cleaned up.

India has been touted as the “next China,” a label local trade groups and business executives have relentlessly promoted. Besides being the only countries with a population exceeding 1 billion, however, the similarities are perhaps too many for today’s climate.

Even so, despite Prime Minister Modi’s best efforts to convert the nation into an autocracy driven by a Hindu ruling class, India is fighting a current that China avoided during its rise to manufacturing power, and that flow is getting stronger.

Yes, Nokia and Apple suppliers like Foxconn continue to make plans to expand in the country. But the broader supply base still isn’t there, and, perhaps burnt out from their China experience, expats aren’t relocating by the thousands to help the locals set up and manage companies. The semiconductor industry has changed over the past 20 years. New foundry costs are still rising, and the number of players has shrunk. Putting multi-billion dollar plants in India that replicate older technologies while still finding the resources to compete on the leading-edge might be a longshot, at best.

Nor has India provided the incentives China did to relocate. Instead, it has taken a tack similar to Brazil’s: Steep import taxes that while aimed at China, might actually discourage others from migrating there. Already, India and the US have taken economic swipes at each other, with the US dumping India from its preferred buyer program that allowed zero tariffs exports to the US, and India hiking tariffs on product coming from the US. The EU Parliament is taking an equally dim view of the former British colony’s trade and humanitarian approaches.

Indeed, Modi’s approach to alienating and, some argue, encouraging violence toward India’s religious and ethnic minorities puts Western OEMs in a difficult spot. Already under the gun for their massive investments in China, which have helped prop up that country’s autocratic leadership and create an international powerhouse that is now flexing its economic and military muscle all over Southeast Asia, business leaders might be loathe to plow more assets into yet another unpredictable regime. With governments, including the United States, slapping restrictions on Chinese companies for their alleged treatment of Muslim minorities, it won’t be easy to win any PR battles over why India is somehow an exception.

And the pollution coming out of India might be on a par with China’s — or even worse — hardly an attraction for today’s green marketing campaigns.

It remains to be seen, but I think episodes like Wistron’s will delay the push to the “next China.”

Tariffs are Taxing the Supply Chain

Posted on by

The breaking tariff situation in the electronics industry is equal parts fascinating and chilling because of its lack of near-term precedence and unpredictability. We’ve spoken with several EMS companies (read the article here) to gauge the extent of the disarray and get a sense of how they are (attempting to) resolve the issue.

Our reporting is ongoing, so be sure to check back occasionally for updates.

 

 

‘Fake Parts’ Data as Perplexing as the Issue

Posted on by

Interesting report on counterfeit component trends, prepared by ERAI.  PLICs and microprocessors are the most commonly reported counterfeited parts.

One big takeaway: “Suspect/counterfeit parts that have not been previously reported are constantly entering the electronic supply chain and the threat of encountering one of these parts remains very high.”

All that said, the number of fake parts reported is minuscule — just 774 were reported to ERAI. As epidemiologists know, the best way to reduce risk and occurrence of negative outcomes is through research and communication.

Where the Jobs Are

Posted on by

This news item from the Associated Press cuts to the heart of the matter when it comes to reshoring of manufacturing and why skeptics (including this humble writer) abound over whether Foxconn, among others, truly intend to set up large manufacturing plants in the US:

WASHINGTON (AP) — President Donald Trump brought two dozen manufacturing CEOs to the White House on Thursday and declared their collective commitment to restoring factory jobs lost to foreign competition.

Yet some of the CEOs suggested that there were still plenty of openings for U.S. factory jobs but too few qualified people to fill them. They urged the White House to support vocational training for the high-tech skills that today’s manufacturers increasingly require — a topic Trump has seldom addressed.

“The jobs are there, but the skills are not,” one executive said during meetings with White House officials that preceded a session with the president.

The truth is there are hundreds of thousands of manufacturing jobs available in the US today. The US Census Bureau puts the figure at just shy of one million. In talking with circuit board fabricators and assemblers over the years, the biggest impediment to hiring is not lack of work but rather lack of qualified workers.

My belief is that the demographics of electronics design and manufacturing resemble a bimodal distribution (two humps), whereby workers over 50 years old represent the largest group by age and workers aged 20 to 30 the second largest. Those aged 30 to 50 are the smallest group (the valley in the graph, see below). My thesis is that workers in that segment were coming online right about the time the North American electronics industry cratered — late 2001 to early 2004, leaving them either out of jobs or unable to crack the then much-smaller workforce that was left after the tech recession.

(The graph below illustrates the basic concept, although in reality the right hump would be higher than the left as there likely are more workers over 50 than under 30 in electronics design and manufacturing today. But you get the idea.)

With the older wave starting to retire, coupled with an upturn in the industry’s fortunes starting around 2008, a new wave of workers has entered the industry. And while we often speak of the lack of millennials in manufacturing, a tour of Silicon Valley area shops takes the air out of that conversation. There, workers don’t ask where the young people are; they just look around — they are everywhere. And manufacturers are catering to them, setting up coffee (and more) bars inside their plants, creating workspaces that resemble outdoor atria that offset the traditionally sterile assembly lines.

Moreover, there is some concern that widespread move of manufacturing back to the US will only accelerate the implementation of robots, leaving thousands of operators on the sidelines. In anticipation, robot makers are ramping capacity, in some cases by as much as two times. This is not without precedent. Those of us who were around when PCB fabrication and assembly migrated to China en masse in the late 1990s/early 2000s recall how common semiautomatic machines were then. It was a nod to the Chinese government, which was adamant about protecting employment.

What’s your experience? Is your company weighing a return to the US? If so, will it come with an increase in automation?

(Please, no political comments.)

Auto Electronics: Gearing Up or Headed for the Cliff?

Posted on by

What would the electronics industry do if automotive demand were to pull a Thelma and Louise and head off the proverbial cliff?

The auto recovery has been the axle of the Western supply chain since 2008. The drivetrain is starting to show some wear, however, with market followers forecasting nominal growth at best for 2016.

The good news is that electronics content in vehicles continues to increase, rising to 8.9% of the $1.42 trillion worldwide electronic systems market last year, up slightly from 8.6% in 2014. Moreover, forecasts call for the share to continue to rise over the next several years.

Less clear is the extent, if any, the seers account for the potential for widespread ride-sharing trends or — worse for some — outright banning of vehicles.

To wit: Some 27 million Americans alone will use some form of ride-sharing at least once this year, a figure that doesn’t include traditional car-pooling. Urban millennials are growing up without the preconception that vehicle ownership equates to status, an important cultural shift.

A drop in demand for hybrid/electric vehicles (HEV) could also decelerate electronics growth. Hybrid sales alone dropped 15% year-over-year in 2015 — reversing a big gain in 2014 — and bottoming oil prices have kept the market for electric sluggish. Hybrids carry almost twice the electronics content of conventional gas autos, making HEVs a key growth engine for electronics makers.

More disconcerting to the auto supply chain is the prospect of a carless environment. This is actually happening, and in places you wouldn’t necessarily associate with technological backlash. For example:

  • Bogota, Colombia, has been car-free on Sundays since 1976, a move that sidelines an estimated 1.5 million vehicles.
  • Likewise, Jakarta has sponsored Car Free Day every Sunday since 2007.
  • San Francisco shuts certain streets to vehicle traffic on various Sundays throughout the year.
  • Oslo plans to ban cars from the city center by 2019.

Car-free days are becoming so widespread, the phenomenon has its own Wikipedia entry. In fact, now there’s even a World Car Free Day (Sept. 22).

The electronics supply chain has gotten plenty of mileage from the automotive industry for nearly a decade. It might be time to find a backup plan, however, if the sector wants to keep trucking on.

How Far Should Sustainability ‘Standardization’ Go?

Posted on by

My longtime friend and industry colleague Pam Gordon blogged today about the role trade associations should play in driving the industry toward sustainability practices. In it, she writes

Associations will not necessarily push members to the next level of sustainability practices. But members can raise the baseline through their involvement and commitment — emphasizing that the industry’s continued profitability and continuity rests in good part on meeting customers’ increasing efficiency requirements, avoiding dependence on dwindling materials, and reducing costs through design-for-environment principles.

I agree with all that. But Gordon also mentions a colleague’s discussion of the possibility of trade groups offering certification in supply-chain sustainability, suggesting that those that do not are behind the curve. There, I’m very reluctant to concur.

I am a huge fan of standards, but I also recognize their limits. I view sustainability as an extension of innovation. And innovation is not something that can be standardized. Those companies that consistently adapt fastest to market demands are always the winners in the long run. I think the same will be true with design for recycling and reuse and other such initiatives. Companies will either pursue that course or not, but to add a layer of bureaucracy in the form of yet another pursuit of paper isn’t the way to go.

Pam writes that some associations help members raise their own sustainability goals above the level of current regulations by giving them workable frameworks, such as the codes of conduct from the Electronics Industry Citizenship Coalition. I have long felt the EICC’s code of conduct is a sham. Under Labor, for instance, the first rule is, “Participants are committed to uphold the human rights of workers, and to treat them with dignity and respect as understood by the international community.” Yet EICC members include Foxconn and Pegatron, which are routinely cited by watchdog groups for worker abuse. It may be a code, but its toothless.

Pam is tuned in to the industry and always makes her readers think. Her note that the industry lacks roadmaps for best practices in sustainability is dead on. A roadmap isn’t a certification, however, and that’s where I call on trade associations to draw the line.

Do Fakes Count?

Posted on by

The news today regarding the seizure by US Customs of nearly a quarter-million counterfeit electronics devices makes me wonder: Do the various industry market research data include all those faked goods?

Consider: Some reports claim as much as $100 billion a year worth of fake electronics products is trafficked. Given that the entire consumer electronics supply chain produces about $1.2 trillion worth of products per year, and most fakes are consumer goods, that’s a pretty good chunk to add to it.

Not all fakes work, of course. For years, “salesmen” would hawk counterfeit PCs outside the doors at Nepcon China. But they were missing most of the important parts — motherboard, CPU, memory, etc. Caveat emptor to those who fell for the scam.

But what’s changing is that in many instances, the knockoffs so closely resemble the look and functionality of the originals, it’s hard even for company officials to discern. And you don’t get there without using real parts, even if they are of lesser quality.

The wildest example I know of concerned NEC. A few years back, the Japanese computer and chip company learned of a massive multinational counterfeit ring which attempted to essentially recreate the entire company! More than 50 factories in China and Taiwan were producing faked NEC PCs and consumer handhelds.

Fifty factories is a scale that’s hard to hide. That’s a lot of production lines to buy, too. It makes you wonder if they were building them on knockoff SMT equipment.

Reasons for Enthusiasm Real

Posted on by

Even the most pessimistic industry-watchers should be curious at least over the shifting attitudes toward bringing production back to the US.

The New York Times today published an extensive piece looking at the top-down change — from President Obama on down — in the nation’s outlook toward manufacturing. Researchers at MIT and elsewhere are promoting the benefits of keeping makers and thinkers together. “The manufacturing process itself is going through an innovation revolution,” said Stephen Hoover, chief executive of Xerox PARC, noting the emphasis on smaller numbers of highly skilled techs who run sophisticated and heavily automated lines.

Earlier this week, Mike McNamara told listeners at an investment conference that higher (and unabating) labor costs in Southeast Asia is making the decision process over where to put its plants “more interesting.” The Flextronics chief executive said he could see production coming back to the US. “[O]ver time, as [labor]  costs continue to go up, you’ll probably see more things get pushed back in the USA,” McNamara said.

Even Foxconn is showing some appeal (for a change) for its push toward automating its factories. Maybe Jim Raby’s vision for true lights-out manufacturing will finally be realized?

A decade ago, at Wall Street’s urging, companies followed the herd to China. Not enough thought was given to the ramifications of chasing lower labor costs, and my guess is that we will be feeling the pain of these short-sighted decisions for some time to come.

But given the prospects for higher levels of automation and a more balanced approach to regionalization, it’s been years since the industry was so exciting.