February, 2019
www.us-tech.com
Understanding (and Surviving) the Electronic Components Shortage
By Chuck Conley, Product Marketing -- Supply Chain Solutions, Jabil, Inc. T
he business and technology media have beguiled consumers recently with head- lines promising a bright, new technological
age exemplified by the Internet of Things (IoT), autonomous and electric vehicles, and ever more sophisticated smartphone designs. Meanwhile, further up the value chain,
where these modern marvels are actually manu- factured and assembled, a somewhat darker story has been unfolding over the past two years, as electronics companies and integrators navi- gate component supply shortages, price hikes and lengthening lead times. On the demand side, the market for elec-
tronic components is finally showing signs of slowing after many consecu- tive quarters of double-digit growth — though demand is still robust. Many suppliers are using this correction to rationalize their backlog, starting from six months out and working back to 90 days, while reviewing and adjusting any capital expenses going into 2019. On the supply side, a shrinking
supplier base is shifting production away from legacy parts to support more cutting-edge — and profitable — components. These factors tell only part of the story. Each commodity market poses its own particular chal- lenge. Memory densities in smart- phones, for example, have doubled, while supply rose only a little more than 33 percent in 2017. More recent- ly, subcategories, such as DRAM and FLASH, have begun to see price reductions, and demand is expected to slow in early 2019, but strengthen again later in the year.
Industry research firm IHS Markit has reported that in Q1 2018 all major end-markets for electronics recorded double-digit increases in purchases over Q1 2017.
Meanwhile, the supply of pas-
sive components, including multilay- er ceramic capacitors (MLCCs), is also trailing demand. There is an MLCC inventory correction making its way through high-volume, stan- dard capacitance components. But the rest of the market for these compo- nents remains extremely tight, with some suppliers reporting upstream shortages of the ceramic substrates as a contributing factor. Further compli- cating the landscape are a number of other macroeconomic developments, ranging from rising labor expenses in the key electronics manufacturing region of China to increased price volatility in metals, prompted by the ongoing trade war.
Demand Expands and Deepens Industry research firm IHS
Markit has reported that in Q1 2018 all major end-markets for electronics recorded double-digit increases in purchases over Q1 2017. Within this market-wide surge
in demand, individual product seg- ments stand out — smartphones in particular. While the current smart- phone market is experiencing a slow- er growth trend of uncertain dura- tion, each successive generation is incorporating more and more semi- conductor and passive products. The
smartphones rolling off the line today, for exam- ple, contain over twice the number of MLCCs used in a product manufactured in 2011. In fact, smartphones represent the largest
2018 saw double-digit increases over 2017 of all major end markets for electronics, with the smartphone market well ahead of the pack.
source of demand for passive components and memory products today. Roughly 1.5 billion smartphones are manufactured each year, with top models containing approximately 1,000 capacitors each. That translates into three tril- lion capacitors annually, or approximately half the total global output of MLCCs each year. There is a parallel trend in the automotive industry. Vehicles powered today by conven-
Continued on page 67
Page 65
DISCOVER THE SHORTEST PATH TO A SMARTER FUTURE.
Meet the new MYPro Line™ Wherever the future might take you, the path just got shorter. With the MYPro Line, you can jet print perfect solder joints at the highest speeds. Ensure non-stop production with intelligent storage and proactive replenishment. And eliminate defects with 3D inspection systems that monitor and improve your process over time. It’s the best of Mycronic in a single integrated manufacturing solution for the most demanding build schedules, enabling maximum utilization with machine-to-machine communication and factory connectivity. The shortest path to a smarter future starts here.
See at IPC APEX, Booth 2141
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74 |
Page 75 |
Page 76 |
Page 77 |
Page 78 |
Page 79 |
Page 80 |
Page 81 |
Page 82 |
Page 83 |
Page 84 |
Page 85 |
Page 86 |
Page 87 |
Page 88 |
Page 89 |
Page 90 |
Page 91 |
Page 92 |
Page 93 |
Page 94 |
Page 95 |
Page 96 |
Page 97 |
Page 98 |
Page 99 |
Page 100 |
Page 101 |
Page 102 |
Page 103 |
Page 104 |
Page 105 |
Page 106 |
Page 107 |
Page 108 |
Page 109 |
Page 110 |
Page 111 |
Page 112 |
Page 113 |
Page 114 |
Page 115 |
Page 116 |
Page 117 |
Page 118 |
Page 119 |
Page 120 |
Page 121 |
Page 122 |
Page 123 |
Page 124 |
Page 125 |
Page 126 |
Page 127 |
Page 128 |
Page 129 |
Page 130 |
Page 131 |
Page 132 |
Page 133 |
Page 134 |
Page 135 |
Page 136
