Solid base for British optimism
01 September 2009
2008/9 is proving to be a challenging time for most manufacturers and the PCB bare board fabricators are not immune. There have been reports in China and USA of plant closures and in Germany the market is down 40%. Mike Bannard looks at the UK's prospects.
As a result of the migration of high volume to the Far East, the UK over recent years has restructured itself into a market much more focused on niche products and services. The reduced number of “survivors” have come through a number of recessionary periods and invested in continuously increasing technology and strong customer service developing an ability to meet very demanding short lead times.
The result of this is that the latest UK industry statistics show an overall year on year billings drop of 9% with exports holding up well at the same level as last year. Whilst tough it does compare very favourably with the c.50% figures coming from other industries such as automotive and capital plant and the 40% from German PCBs.
So the UK’s PCB strategy has given it a much better chance of survival. It is true that many fabricators have had to reduce staff and working hours. More than 10 of the smaller companies have closed their doors in the last year but the majority are still focussed on exiting the recession in a position to carry on supporting the UK electronics industry with the service it deserves.
It is apparent that the most professional buyers have recognised that the number of PCB fabricators with the critical mass and technical capability to meet their increasingly demanding requirements has reduced over recent years to a relatively small number and they are taking a much more strategic approach to long term supplier selection. They have recognised that it is in their interests to develop partnerships that will endure and allow the continuous investment that is essential to support them.
So what are the current concerns and challenges for PCB fabricators and their customers?
Cash has to be king and it is disappointing that a number of customers are attempting to put the squeeze on the industry with late payments and demand for extended terms.
Material suppliers are drastically cutting their technical support and are also rationalising world manufacturing facilities. This is causing concern as PCB Fabricators are finding that materials such as laminate are exhibiting inconsistencies in properties like dimensional stability and many chemical suppliers now have only 2 or 3 technical representatives to support all the installed process lines throughout the UK.
PCB Fabricators have concern at the damage brokers are doing to UK industry.They do not use any of the UK material suppliers so they are not supporting the future of the supply chain mentioned above. They are not supporting R & D and new developments in the UK PCB industry and they are putting pressure on all the UK manufactures to reduce prices to match their imported prices which often amount to “dumping”.
There is considerable empirical evidence that as the Far East cut back dramatically and faced the challenge of selling in a much strengthened US dollar that short cuts in manufacturing have caused some suppliers to provide product which does not meet specification. Of course it is often very difficult for the customer to identify this in a PCB until it becomes apparent in assembled product failure or performance.
In summary then we are in a challenging market, the strategy of the last few years has put our industry in a stronger position than many others to survive recession and the UK and European Electronics Industry needs the survivors to continue meeting the demands of the future. Your UK PCB Fabricators intend to be there, please support them!
Mike Bannard is chairman of the PCB Fabricators group (formerly PCIF) currently residing in Intellect. This group meets 4 times per annum. and has a regular attendance of over 20. The group is keen to continue to provide a forum for PCB Fabricators to share problems of common interest and work together to solve them. It encourages as many UK Fabricators as possible to join and support it.
(www.intellectuk.org)
Mike Bannard is also Managing Director of Kelan Circuits
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