More Than a Supply Chain Problem

Estimated reading time: 2 minutes

By now, the topic is practically a trope: Supply chain problems abound, and they aren’t going away any time soon. Transportation and logistics are a key part of the challenge, meaning that the shorter we can make the shipping distance, the more resilient the chain will be overall.

But that’s only part of the problem. It is currently not possible to simply shorten the chain; there are key elements of the electronics manufacturing process that are only available in a very few places on the planet.

Semiconductor chips, for example, need to make at least one roundtrip to Asia to be put into a package. Depending upon their specific supply chain, they may then get sold to an international firm and shipped somewhere across an ocean again. As the finished board assembly goes to its customer, that chip just might make a long-haul international flight a final time.

PCBs produced in volume will make at least one transoceanic trip as well, either as bare boards, assembled components, or as a finished product.

The unadorned truth is that if you start with the first manufacture of the components on a circuit board assembly, it becomes clear that a finished, populated printed circuit board simply cannot be developed by a North American company without a significant amount of international shipment sprinkled throughout the supply chain.

IPC Reports Outline the Issues
Two high-profile pieces of legislation in Europe and the United States, both using the “CHIPS” moniker, seek to encourage semiconductor capacity within their respective regions. But at the moment, making more chips still means they get shipped overseas for packaging. Organizations such as IPC, USPAE, and PCBAA are working in their own areas of specialty to educate government representatives on this vulnerability in the entire supply chain.

Recently, IPC’s Thought Leadership Council issued two separate but coordinated reports to help illustrate these points:

• “North American Advanced Packaging Ecosystem Gap Assessment: Critical Systems, Capability, Capacity Analysis and Recommendations,” authored by Jan Vardaman and Matt Kelly
• “Printed Circuit Boards Matter: Rebuilding the U.S. Electronics Supply Chain,” prepared by Joe O’Neil

IPC Thought Leadership Council’s Mike Carano also published a report aimed at the manufacturing companies themselves, titled “Jumping the Technology Curve: Collaboration With Your Competition.” These documents strive to deliver a holistic view of our manufacturing process, and provide guidance on how to strengthen the chain, not just a single link.

O’Neil states what has become obvious to most of us in the industry. “The United States has lost its historic dominance in a foundational area of electronics technology, namely, the printed circuit board (PCB) fabrication industry,” he writes. “In the halls of government, most of the attention is on semiconductors, due to the shortages triggered by the COVID-19 pandemic, combined with strong demand for all kinds of goods and services that contain chips.” Vardaman and Kelly also recognize the issue, writing, “Given recent increased focus and investment by the United States Government and firms to improve North American semiconductor foundry capability, IPC is establishing a Government Relations advocacy position that encourages greater policy focus and investment on growing the wider advanced packaging ecosystem, not just semiconductor fabrication.”

To read this entire article, which appeared in the March 2022 issue of SMT007 Magazine, click here.