Where next for the UK PCB Sector?
18 August 2008
Henry Parker of Intellect provides an overview of the PCB market in the UK and Ireland.
We all know that the UK electronics sector as a whole has been through tough times of late. Electronics manufacturing, and in particular PCB Fabrication, has suffered from the huge expansion of competition from low cost economies in the Far East. Those fabricators that pulled through the steep downturn experienced in the early part of the decade did so because they recognised that that their businesses must be remodelled to reflect new market realities. While smaller, today’s UK sector is also leaner and more dynamic than has historically been the case.
Intellect administers what we believe is the only truly comprehensive market survey for the UK PCB market. We also retain an active community of fabricators as members through our PCB Fabricators and Suppliers group, which meets quarterly to discuss the state of the sector, and agree common approaches to the challenges it faces. These members account for a significant majority of the UK market by turnover. Against this backdrop, we’re of the view that, after tough times, the market has largely stabilised, with a continuing trends for growth in sales from the Military/Aerospace and Industrial sector. There is also a slow, but noticeably upward trend in the 12-month moving averages for UK Bookings vs. Billings. However, we must be careful not to paint too rosy a picture. There are still some worrying indicators. The communications market, traditionally a major source of revenue for the UK sector, has gone through a severe downturn with little sign of recovery. This has in turn increased the reliance of the UK sector on Military/Aerospace and Industrial.
As ever, the increasing tide of environmental regulation emanating from Brussels may force further changes in the production process thereby increasing costs. In particular, the RoHS Directive is under review, with a possible 46 substances planned to be added to its scope. Members have noted that many of these substances are key to PCB manufacture. In particular, cobalt is used as a co-deposit to give hardness to gold plated contacts on PCB’s. Nickel is used as an underplate (sometimes as final finish) for immersion in gold and electroplated gold, and is kept as nickel sulphate in the bath. Finally, glass fibre is the fundamental building block of laminate, and is present in chopped form from dust that occurs when cutting finished circuit boards. The European Commission has indicated that if industry does not provide concrete technical evidence that other substances cannot used instead of those they propose to ban, and that such substitutes would cause greater harm to the environment than those currently in use, it is likely that such a ban will go ahead in 2009. Unfortunately, the formal period of consultation for the reforms to RoHS is now complete, but fabricators need to be aware that such changes are in the pipe-line, and we remain ready to take additional action if our members ask.
All in all, the need for the UK sector to act collectively, and speak with one voice, in the light of these challenges has never been more acute. For that voice to be clearly heard, by both Government and by target markets, industry needs to work together. Intellect members use us to exchange views and monitor the market in way they perhaps wouldn’t be able to otherwise. We aim to do all we can to ensure the UK PCB sector has a positive future and we welcome any who would like to join us in pursuing this goal.
Henry Parker is Programme Manager for Technology Markets at Intellect, and runs its tailored programme for the UK electronics manufacture and design community. Intellect is the UK trade association for the IT, telecoms and electronics industries. Its members account for over 80% of these markets and include blue-chip multinationals as well as early stage technology companies. These industries together generate around 10% of UK GDP and 15% of UK trade.
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