Insights from a PCB Pioneer: Dr. Hayao Nakahara's Global Journey

Estimated reading time: 6 minutes

In a candid conversation, industry luminary Dr. Hayao Nakahara (Naka) delves into his long and illustrious journey across the global PCB landscape. As the founder of NTI, Naka has toured hundreds of PCB manufacturing facilities worldwide, amassing a wealth of data and insights. Dan Beaulieu captures the essence of Naka’s profound impact on the PCB industry, from his early days in R&D to his current role as a revered source of knowledge and analysis for industry professionals.

Dan Beaulieu: Naka, I appreciate what you have done for our industry. Please start by sharing the NTI story. 

Hayao Nakahara: I founded NTI in 1986 while I was still with the PCK Technology Division of Kollmorgen Corporation. At its founding, there was no clear objective. An accountant friend of mine told me that in New York state, an S-Corporation has all the privileges granted to large corporations. So, the purpose was to use these privileges for business expense write-offs. I founded it and it has remained a one-man organization.

Beaulieu: I know you have been in the industry for many years. Would you talk about how you got into the industry and how you began your recent journey?

Nakahara: By chance, I was offered a job at Photocircuits Corporation right after I obtained my MSEE from the University of Washington in Seattle in January 1965. My first assignment was the R&D of electric servo motors used for tape transport. Next, I was assigned to software development for computer aided design (CAD) of printed circuit boards. Over 25 years with Photocircuits (the last 15 years with PCK Technology division, a sister division at Kollmorgen Corporation), I accepted many assignments, particularly in international technology licensing, which took me all over the world. I began to realize that there were many new technologies developed and practiced in the U.S. and Japan, and there were opportunities to introduce these technologies to PCB makers in developing countries such as South Korea, Taiwan, and China. That was in the early 1990s.

Beaulieu: I know you sell a fact-filled subscription newsletter. Please tell us about that.

Nakahara: Decades ago, I started writing about new technologies, and as time has gone by, I have authored many articles about technology, market, investment opportunity, and other things.

Beaulieu: How do you get your information?

Nakahara: Most information is obtained from PCB plant tours, which provide me with the technology levels, equipment, materials, processes, yield, cost of production, and a variety of other PCB-related information.

Beaulieu: What kind of information do you provide your customers?

Nakahara: My clients are PCB makers, equipment and material makers, all related to PCB production who are looking for either information about their competitors or, in the case of equipment makers, potential customers.

Beaulieu: Do you offer other services, like private research, consulting, and advising?

Nakahara: Not really. Project work is not my cup of tea. I never take up a project which takes too much time and pays too little. 

Beaulieu: So, it cannot be easy to travel all over the world. What are your thoughts on that?

Nakahara: My entire business expenses are travel and lodging. I have a sufficient customer base to support my world travel across North and South America, Europe, Asia, the Middle East, and Africa, in 67 countries. I have probably visited over 600 PCB manufacturing plants and some CCL, chemical, and PCB equipment manufacturers as well.

Beaulieu: How is your business going?

Nakahara: Business has slowed down since COVID, but there are still a sufficient number of customers who support my activities.

Beaulieu: As far as I know, there is no one doing exactly what you do. How do you see the PCB and PCBA business today? Are you optimistic?

Nakahara: PCB production goes up and down year by year, but when viewed over the long term, it will continue to grow as more chips are used.

Beaulieu: I know you have been a great champion and advocate for globalization and all countries working together. What is your opinion of the current geo-political climate and the current U.S. sentiment toward manufacturing electronics in China?

Nakahara: Globalization is unavoidable. No matter what people say, the final winners are the ones who can offer quality products with competitive pricing. However, there are some PCB markets which are not price dependent. Despite all the noise, the U.S. is still heavily dependent on PCBs made in China, some of which may be moving to Southeast Asian countries. Cost and proximity to users of PCBs (customers) are some of the benefits of globalization.

Beaulieu: I appreciate your perspective. Do you have any final thoughts you would like to share with the industry and our readers? 

Nakahara: Decades ago, many successful PCB makers began with garage operations. Those leaders were able to attract willing and able engineers, line workers, and business-minded people, who could be motivated and become successful. They had the courage and foresight to invest the right amount of capital at the right time in the right markets. I have observed over time that successful PCB fabricators are people of pride, with intelligent, responsible minds, and who embrace a spirit of challenge. There are many PCB market research reports floating around, including mine. My approach is bottom-up. I try to minimize “guesses.” My many years of effort compiling a table of the world's top PCB makers—my hobby—helps me to minimize guessing games. 

In my opinion, there are probably 2,800+ PCB makers in the world. In China, there are over 1,500 makers operating close to 2,000 plants, including foreign transplants. It is impossible to get accurate PCB production numbers from all the Chinese fabricators. I can trace about 600, but that is not enough to produce a satisfactory “total” number. Researchers often mix “market” with “production.”  The U.S. “production” is estimated to be about $2.6 billion, but the “market” is far greater than this amount; $2.6 billion is achieved by about 160 PCB makers—new ones are coming up, but mergers and acquisitions keep this number constant. 

Thailand's 2023 PCB production is estimated to be about $3.2 billion, achieved by about 25 makers. This is changing rapidly in the next several years as more than 40 from Taiwan and China are building new plants in Thailand, investing more than $10 billion all together. Investment dollar amounts will be bigger. In due time, I see an investment of $1 will turn over $1 output. It does not require rocket science to figure out what will happen in PCB output in Thailand in years to come.

I was privileged to visit several new PCB plants in Zhuhai, China, last December in conjunction with the HKPCA show. I saw no film exposure systems at these plants. They all used pattern formation—inner layer, outer layer, and even solder mask—are performed by direct imaging (DI) systems. During the HKPCA exhibition, I spent a solid four days interviewing DI suppliers. The conclusion is that there were about 1,500 DIs worldwide in 2023, and more than half of them were made by Chinese suppliers and installed in China. Technologies were once led by the U.S., Japan, and Europe. The picture is changing.

Beaulieu: Naka, this has been remarkably interesting. Thank you for talking to me today.

Nakahara: It is worthwhile to talk about the PCB industry. Thank you.