Issue link: https://iconnect007.uberflip.com/i/1284035
SEPTEMBER 2020 I SMT007 MAGAZINE 63 Malmrose: Most customers like the mantra, "We're going to do domestic manufacturing. We're going to do whatever." But at the end of the day, the cost is what drives it. Feinberg: Is it cost or price? Many people are talk- ing about, "We need the lowest cost," but they're talking about the lowest price. And when you talk to them, you find out their cost is higher. Malmrose: The motto needs to be the lowest total cost of ownership, so it does need to be a line of cost to wherever your deployment site is; that's where you need to evaluate. We have tariffs, plus labor costs in Shanghai and Shen- zhen have escalated year after year for the last 10 years. It's not as cheap as you think. For us, to say you want to bring manufacturing back to the U.S., we're still looking at the total cost of ownership as being the driving factor for our sales pitch with the customers. Some people say, "We have a competitor in China, and they're $17 ex-factory. You are $21 ex-factory." Throw in the logistics, freight, cost of capital, product on the ocean, and inven- tory that's going to have to be reworked when it gets here. All that stuff needs to be put into the lowest total cost of ownership landed cost model to really understand what the right thing to do is. Forget about keeping your IP safe when you build your product in China; the IP is going to get lost. One way or another, you're going to lose it. Play the game however you want. If you're Apple building an iPhone, and you're going to spin it every 6–12 months, that's fine. But if you have a long product life cycle and you care about your IP, you have to build it in the U.S. Be smart about supply chain, and keep your IP. Johnson: Is there anything else that we should have talked about with regard to reliability and Green Circuits? Malmrose: It may be no surprise, but most of our reliability emphasis is at the PCBA level. We do thermal shock and temp cycling. Those are device-related accelerated life testing. And we do burn-in, so it's mostly electronics-ori- ented, trying to accelerate infant mortality and expose latent failures. On the box build side, I spent a bunch of years at Boyd Corporation, and it was interest- ing that on the mechanical side, the box build very frequently is the afterthought, where peo- ple think, "Now we need to do this." Thermal is another aspect. Also, people say, "We have EMI shielding, and it's not working. Now, how do we fix that?" Then, it's about cost; thus, you get into issues like compression set and what type of foam you should use. There are expensive products out there, so engineers start looking for a Chinese alternative. The reliability aspect is really focused on PCBA. We do conformal coating, as well as parylene coating and potting for products. We're in aviation and medical that require spe- cial processing. Some people look at mechani- cals early in the design process, but in general, we put all the focus on electrical engineering— not that much on the mechanical engineering side unless an engineer says, "I'm going to do the three-meter drop. I'm going to do shock test. I'm going to do the burn-in." We don't see a lot of people concerned about the mechani- cals. It's sort of like, "We're just going to do this. We just need you to heat sink this. Put these screws in. No specs." It's our obligation to make sure our screw- drivers are calibrated, but it's not uncommon just to hear, "Put the box together and just wing it on how tight you should put the bolt and make sure that the star nut is strong enough." There's not a lot of attention to that. Not that we have a lot of returns for that because, again, it's mostly electronics, but it would pay compa- nies well to consider that in their product design and deployment, if they want to have the repu- tation that their box is indestructible. Johnson: Thank you both so much. It was nice meeting you. Castro: Likewise. Malmrose: I appreciate your time, and I look forward to connecting again. SMT007