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38 SMT007 MAGAZINE I SEPTEMBER 2023 PCB SWOT Analysis, Consensus Views Strengths e European PCB industry has estab- lished a stable presence in the European mar- ket, backed by hard-earned and longstanding relationships with their EMS and OEM cus- tomers. Customers value the manufacturing quality and security associated with sourcing from a European PCB supplier, as well as sim- plified logistics that come with proximity. e PCB industry has a small, but highly skilled workforce comprising individuals with strong back g round s in eng i- neer ing and manufac- turing. A few European PCB companies have lev- eraged this workforce, along with investments in R&D and new equipment, to produce state-of-the- art PCBs and integrated circuit (IC) substrates. Proximity to customers gives European PCB fab- ricators an advantage in prototyping , given the paramount importance of speed, IP protection, and technical support. e European industry also has a strong cus- tomer base in the industrial, aerospace, space, defence, medical, and automotive sectors. Weaknesses e erosion of the PCB industrial base is becoming increasingly dire. Since 2000, the number of European PCB companies has fallen from approximately 560 companies to fewer than 175 and total revenue has fallen by two-thirds. e industry is highly fragmented, comprising primarily small companies. Nearly 65% of European PCB companies had rev- enues in 2020 of less than €10 million Euros. e decline in European PCB production is largely the result of the region's higher cost of manufacturing and lack of capital invest- ment. Marketplace competition drove many OEMs to source lower-cost electronics from Asia, which led the European PCB industry to focus increasingly on high-mix, low-volume production, including prototyping and spe- cialist industries (e.g., aerospace and defence). e decline in volume relative to Asia has had a compounding effect on costs and the ability to invest. Most suppliers of materials, chemis- tries, parts, and components moved offshore, saddling European PCB fabricators with the "low-volume disadvantage" offered from Asia. e unavailability of a strong regional supply chain for materials and chemistries remains a top concern. e European PCB industry faces technical challenges as well. Most companies have limited resources to undertake R&D and few opportu- nities to partner with global materials and equipment manufac- turers due to the lack of regional, high-volume production. Acquisition of new equipment is also challenging due to cost, lack of confidence in market demand, and lack of medium- to long-term forecasts. Simply put, capital investment carries significant risk. e lack of sufficient investment in R&D and capital investment is slowing down industry efforts to embrace technological advances. For example, a recent Eurospace white paper high- lighted concerns about the systematic reliabil- ity of microvias in high density interconnect (HDI) PCB technology. PCB companies continue to rank workforce dynamics as one of their top concerns. A signif- icant percentage of the industry is at or nearing retirement; companies cannot hire sufficient numbers to replace those retiring and grow their businesses. e industry also faces high turnover, increasing training costs, and lower- The unavailability of a strong regional supply chain for materials and chemistries remains a top concern.