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PCB007-Dec2021

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10 PCB007 MAGAZINE I DECEMBER 2021 Feature Interview by Barry Matties I-CONNECT007 In this wide-ranging interview, Shawn DuBravac, chief economist for IPC, discusses a variety of market drivers and pressures that are affecting PCB manufacturing and assem- bly. He also shares his thoughts on the relation- ship between inflation, wages, and the current supply chain challenges—and what all this may mean to your bottom line in 2022. Barry Matties: Shawn, as we look at the pres- sures the industry faces today—supply chain, inflation, labor and so on—how should our industry be viewing or reacting to these pres- sures? Shawn DuBravac: ese are forces that are impacting not just companies in the electron- ics manufacturing industry but also everyone who is upstream and downstream of them. ese forces, for the most part, aren't likely to abate soon, and will likely stay with us well into 2022. ese forces are causing companies to really rethink the type of relationships they have with their supply chain. It's causing them to rethink pricing, their suppliers and supply chains, and what those relationships look like. Matties: Looking at our end-markets, what do you see? I'm thinking of automotive, military, medical, and so on. DuBravac: Speaking broadly, we definitely see pressure on the auto industry. We've obvi- ously seen a significant extension of lead times. Many of those shortages are playing out in other industries. When demand picks up and lead times lengthen, it causes an acceleration of orders because people say, "I wasn't going to place that order for three weeks when it was a three- week lead time, but now that it's an eight-week lead time, I need to place that order today." Ultimately, lengthening lead times pulls orders forward and exacerbates the problem. e supply chain is working to address the rapid rise in demand that we've seen over the last year. We're not seeing lead times extend Industry Market Drivers, Inflation, and the Supply Chain Shawn DuBravac

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