Issue link: https://iconnect007.uberflip.com/i/1069358
12 PCB007 MAGAZINE I JANUARY 2019 supply the PCBs all the way up to the full box build for you. Las Marias: From your perspective as an EMS provider, what are the greatest challenges that you face or that you experience when it comes to supply chain? Martin: Well, we're in the supercycle for allocation, so we're heavily into the supercycle that we're dealing with. It started with the memory product, which we're coming up on three years now. And then last summer, around this time, MLCCs started getting tight. By November, we were in full-board allocation. We struggle like all EMS companies, particularly with MLCCs. The lead times are over 52 weeks with most manufacturers, if they will even take orders. The second- and third-tier manufacturers will no longer cross your components, and for distributors, the inventory position is low. So, it's a challenge every time we get an order to find the MLCCs. We're also seeing tantalum shifts. A lot of those are now going on allocation. We have MOFSETs across the board that are running on full-board allocation over 40 weeks. Then, we have IGBTs and TV, Zener, and Schottky diodes, which are all in the 38-week range. In the resistor arena, we have the Vishay CRCW series at 80 weeks now. The Panasonic ERJ series are at 40+ weeks. Generally, all mainstream resistor manufacturers are now 26–29 weeks. It has become quite a challenge. We spend a lot of time talking and working with our customers trying to get them to approve alternates quickly so that we can find materials and expand their AVL, and we spend a lot of extra time sourcing trying to just find inventory. It has become quite a challenge in this market. Las Marias: You mentioned supercycle. Have you experienced this sort of extreme shortages when it comes to electronic component supply before? Martin: I've been in electronics since 1989, so I've been in it a long time. I've been through a number of cycles. I believe this is the tenth inventory cycle that we're in from what I can tell. The closest that we've ever come, and the last time we went into a shortage situation that affected passive components, was in 1999 right before the dot-com crash. At that point in time, we had problems with panels and capacitors. That's the last, and in my career, the only time that the passive products have been an issue. Typically, the market follows some new must- have device, whether it was a pager, cellphone, or laptop computer. This market cycle is very different. This one is not any single device. This market segment is really what we're calling "the electrification of everything." There's a huge change going on. A lot of pieces of our life that were never electronic are now becoming electronically connected to our phones and smart devices. We even have one customer that we're talking to that wants to make furnace filters smart, so they remind you to replace them. All of the devices, including IoT, smart devices, automotive content, and cellphones are hitting us at the same time. No one device will fix the market once it's satisfied. The only thing I believe is going to fix the market is when we can get some increased capacity through new manufacturers coming in. There's also a technology shift happening, which appears to be very close to what happened back in the mid-2000s during the RoHS time where we switched from leaded to non-leaded parts; this one is going from larger to smaller case sizes. If you look at a 1206 capacitor, they can get approximately 80 0402 capacitors in the same space or 300 0201s. As the market is tighter, I believe the OEMs are going to be forced to redesign to smaller and smaller parts, and that will allow the manufacturers to produce more parts in the same footprint that they had before. I think that's more along the line Stephanie Martin