Issue link: https://iconnect007.uberflip.com/i/1484263
52 PCB007 MAGAZINE I NOVEMBER 2022 have a finished good that can be sold. Every- thing else up to this point has been a sub-com- ponent input. For me, this is the first line in the sand. If we produce these chips in new fabs being built in the U.S. Southwest, what happens next? ey are sent to Asia for packaging, so you've essentially lengthened your supply chain, not shortened it. at's why having the capability to build some IC substrate domestically must be a regional discussion, whether it's Europe or North America. Now, we're seeing a model change where it's a regional-plus global model. We should not have any disillusions that the global supply chain is not alive and well. is is not just overcoming the global supply chain; there are lots of things that will never move. For example, let's talk about chip passives: capacitors and resistors. Plants in Malay- sia and other Southeast Asia locations won't be moving. My point is that there will always be a global supply chain that you need to work with. However, we are seeing a stronger need and desire for a regional-plus global model. A regional supplier might be able to deliver at cost-parity at best. It most likely may be even higher cost. But strategically, when you make that decision to say, "I need to have this type of component or these elements made regionally, come what may," you're doing it for very good reason. e thought process may be, "I might be parity at best, but I'm doing it because I'm protecting something that I care about." So, when you set up that regional-plus global model, it allows you to make those types of decisions. Otherwise, if you say global only, then this is where everyone says, "I can't build it at that price. It will cost me too much, so I won't make the switch." Barry Matties: Matt, how will the funding be brought into our industry? Kelly: If they can produce substrates to a cer- tain level, with North American defense as the main market, then they can tap into it. IC substrates are included in the definitions of advanced packaging. at's one of the main drivers for printed circuit board companies looking into this area. With this overlap between substrates and printed circuit boards, IPC is making the argu- ment on behalf of the industry that we define it as "minimum viable capability" so that we can have some of that investment flow; maybe out- side of the CHIPS Act through some of these other funding programs. Step one is seeing what kind of information or investment we can get for substrates, and then continuing that in terms of what we can attract for printed circuit board technologies as well. Matties: Matt, thanks for talking this through with us. Kelly: My pleasure. PCB007 If we produce these chips in new fabs being built in the U.S. Southwest, what happens next? They are sent to Asia for packaging, so you've essentially lengthened your supply chain, not shortened it.