Laminate Consolidations Continue to Stack Up

AGC continued its consolidation of the laminates market this week, reeling in Taconic for an undisclosed amount. The Japanese company also acquired Nelco last winter, giving it two of the remaining US-based PCB materials manufacturers.

That leaves Isola and Rogers as the last two major players of a once formidable domestic laminate industry to call the US home. And neither company produces the majority of its product in onshore. (Sound familiar?)

With Rogers’ capacity consumed by the 5G rollout, some OEMs and fabricators have been turning more to Taconic as a source for high-rel end-products that required a Made in USA stamp.

The largest vendors — KingBoard, Shengyi, Nanya, ITEQ, and so on — are all based in Southeast Asia. The volume and variety of materials that can be sourced in the US continues to erode, and its hard to see that reversing course. To wit, in its announcement, AGC allowed that “Over time, materials made in Taconic’s Petersburgh, NY, location will be moved to another facility.”

Isola makes FR-4 in Ridgeway, SC, and AGC Nelco makes the same in Tempe, AZ. They join Rogers, Taconic and Arlon as manufacturers of electronics materials in the US.

Will trade tensions peaking, and 5G creating supply issues around the globe, is that enough?

2014: The Year of the Deal

Today brings to an end one of the most fascinating years of acquisitions since the crazy Internet era of late 1990s and 2000.

Unlike that episode, however, 2014 was a much more orderly state of affairs, and while some of the deals were not foreseen, the pricing (and volume) were within the realm of reason.

To recap:

  • TTM Technologies announced it would buy Viasystems, bringing to a close one of the most talked-about chapters in PCB industry history. The deal has cleared all but the last few regulatory hurdles, and is expected to close in mid 2015.
  • Rogers will buy Arlon, merging two leading suppliers of high-frequency laminate materials, and perhaps further complicating the supply chain for some of the smaller fabricators that lack the purchasing power of the major players, not to mention consolidating the RF/microwave product supply base for the US Defense Department. Given its shoulder shrug of TTM’s Chinese ownership, will the DoD even bat an eye over this, or will it be concerned enough to throw a wrench in the deal?
  • On the assembly side, ASM purchased DEK, which had been readied for sale since late 2011. The acquisition gives ASM top-of-the-line print-to-placement equipment offerings and positions it to compete with the major Japanese players such as Panasonic, Yamaha, Juki and Fuji.
  • Nordson acquired Dima Group, stretching its traditional dispensing and, later, AOI and test focus into SMT placement. Will Nordson keep the pick-and-place lines, or package that unit up and sell it?
  • Likewise, Amtech Systems has a pending agreement to buy BTU, stretching its semiconductor and solar production focus to include SMT reflow.
  • And just yesterday Kulicke and Soffa made a deal to buy Assembleon for $98 million in cash. While Assembleon had been expected to be acquired since Philips first put it on the block several years ago, K&S’s entry into the printed circuit board equipment space was unforeseen. Does it plan to continue to roll up other companies (Speedline?) and build a worthy competitor to ASM?

Most of the major deals that took place in 2014 happened on the supplier side. Does that presage a similar consolidation on the manufacturing end in 2015? Will some of the units long-rumored to be in play (Multek, Hitachi) finally be consummated? Will EMS, which took a breather in 2014 after major deals involving Natel (Epic), Benchmark (Suntron, CTS) the year before, catch a new spark?

We can’t wait to find out. Happy New Year!

 

Are You Living in a ‘Material’ World?

When discussing RF/MW PCBs, starting with base materials seems like a logical place to start. However, the topic of advanced circuit materials is … well … complicated, especially for a single blog post. I’m sure this is obvious to you, but it took me the better part of this week to come to this conclusion with the help of Dale Doyle of Rogers Corp. and Denis Boulanger of Ventec. (Thank you both for your help, and graciousness!) In the end, I have resolved to leave the “heavy lifting” to the experts. Rogers, Taconic, Arlon, and Isola all have information-rich websites and employ amazing professionals like Dale and Denis who are invaluable resources (as are certain industry blogs).

Nevertheless, I did discover that I have a thing or two to contribute when it comes to this subject, as it is related to printed circuit boards.

There are a wide variety of high performing substrates on the market ideally suited for RF/MW applications. At Transline, we use all of them — because you specify them on your blueprints. In fact, we stock almost every part number of Rogers material, and many of Taconic and Arlon and a few Isola. We do this to shorten lead times and because approximately 60% of our business is in the RF/MW industries. Due to our fluency with these materials, I feel qualified to give you a snap shot of what happens after your order hits our shop floor.

First off, RF/MW materials act NOTHING like FR-4 materials in our manufacturing process! They don’t even behave like each other or one part number to another, or one material supplier to another. That is because they are all made differently and have unique compositions: Teflon, ceramic, duroid, PBD, hybrid mixes, and so on. Further, some are reinforced, some aren’t. Some are reinforced with crushed fiberglass, some with woven fiberglass. The highest-performing materials, with no reinforcement, can have dimensional stability issues so severe that they make your board fabricator want to start parking cars for a living.

A capable, qualified RF/MW PCB manufacturer must be a virtual guru when it comes to materials. They must be experts at knowing how each substrate brand, each composition, each part number, at each copper weight and thickness responds to … (taking a big breath) … etchant, plating chemicals, heat, lamination, moisture, and a whole host of processes met in fabrication. These laminates can be moody and fragile … nothing like good old predictable, robust FR-4. So, just as a good RF/MW engineer brings some art and magic to the science of their design process, so it is with the board manufacturer.

Why is this important to know? Because many an excellent PCB fabricator has made the innocent, though faulty, assumption that because they can make extremely complex boards with FR-4, that this RF stuff will be a cake walk. They may have even enjoyed success with some RF boards made on a specific material, but unable to succeed on another. (Shortly thereafter is when you get that embarrassed phone call informing you that they can’t make your boards after all.)

What I am proposing here is that RF/MW PCB manufacturing is a specialty, just as RF/MW engineering is a specialty within the general discipline of electrical engineering. Far too many PCB suppliers and engineers appear to lack this awareness. Why do I believe this? Because I work with RF engineers daily who have the scars to prove it! I believe this because after having 16 years of experience working with very complex FR-4 boards, and a one year working with RF/MW boards–I still feel like a rookie when it comes to RF boards. I also hear evidence from materials suppliers and buyers. I hear it from engineers on LinkedIn. It is for these reasons that I was compelled to create this blog.

So, here are a few possible solutions I hope may be helpful:

When you evaluate a new RF/MW board supplier, consider asking what percentage of their business is RF/MW, and how long they have been doing RF/MW PCBs? Which materials are they accustomed to working with? Ask questions about their quality and test records that verify their ability to successfully hold the tough impedance tolerances you may expect. Ask for RF/MW customer references. Ask your substrate rep for recommendations — in some ways, I think they have the best seat in the house, often offering some much-needed objectivity.

My advice is this: Don’t rush, headlong, into a relationship with a new supplier because they can save you 10%, because by doing so they may, unwittingly, cost you far more — like the loss of an important customer. Think more along the line of long courtship and marriage, rather than one-night stand in Vegas (a tall order when we are all so price driven!). Finally, look and listen for signs of true expertise. Look for that rare mix of knowledge, skill and experience mingled together with a twist of art and magic.

Blogs are designed for dialogue, so please offer your feedback and comments. If you have more ideas or input on this topic, please share it. We have much to learn from one another and I look forward to hearing from you!

Best wishes,
Judy

Productronica Wrap Up

We’re down to the last hour of Productronica. All in all, it was a better-than-expected show, modest by historical standards but strong compared to everything else this year. Perhaps more important, after a year of malaise, there is a noticeable improvement in the general outlook for 2010. The optimists far outnumbered the pessimists this week.

Time was, Productronica was equal parts assembly and fabrication. No more. While assembly commands four-plus halls, the fab side has been reduced to a single hall. On the fabrication side, laminate makers Isola, Arlon, Kingboard, Ventec and others were on hand, many in booths more in tune with the current market conditions and expectations for the show. Precious little equipment was being shown. Gone are the days when visitors could see 40 to 60 ft. plating lines in action.

David Rund, president of Taiyo America, called the show “excellent,” adding that with 80% market share in the US, Europe was the next big market for the soldermask supplier to target. He added that many attendees appeared concerned about the supply chain, and were attempting to assess their supplier’s financial viability before ordering product.

I did see a few sales were made. Teknek sold a CM8 clean machine to Graphic. David Westwood will become GM of Teknek US and, with marketing manager (and wife) Jenni Westwood, will be moving to Charlotte, North Carolina, to launch the company’s operations.

LPKF was drawing a crowd to gawk at the sharp BMW motorcycle on display, a vehicle (get it?) to hightlight LPKF’s micromachining and LDS laser process that the automaker uses in a number of its products, mostly for steering control boards.

Holmuller is quickly coalescing with parent company Rena. It was a little odd not seeing Joe Kresky there, however.

Electrolube introduced some 13 products this week, most of which were non-VOC flavors of conformal coatings. Customer demand is driving its push into that technology, Karen Harrison said.

Kodak rolled out Accumax, a new red-sensitive film. The company agreed that not many visitors were from outside Europe.

Staff I spoke with at Ventec, Isola and others remarked that the show was smaller than in the past.

Rogers called the show “smaller than usual, but not too bad,” estimating perhaps 20% of the attendees they saw were from outside Europe. Interestingly enough, the attendees were almost all PCB manufacturers, not the OEM designers the company typically targets. John Hendricks says it could be because the visitors want to see the company’s tech support staff, and because they are now offering more high temperature products that would appeal to fabricators. The company is ending its polyimide lines because, as Hendricks told me, that is “a dogfight we don’t want to be in.”

Meanwhile, Arlon was showing EP-2, its enhanced polyimide for high-speed digital applications, which features a Tg of 250®C, lower moisture absorption and lower electrical loss.

Notes

Saw old friend Hans Friedrichkeit, the longtime Photo Print PCB maven, now with PCB-Network. He’s also a board member for the Productronica show.