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40 SMT007 MAGAZINE I SEPTEMBER 2023 onto European-made PCBs. is goal should be implemented in the interest of regional industrial resiliency and economic compet- itiveness, while still acknowledging that, in many commercial applications, PCBs will con- tinue to be manufactured offshore. European PCB companies are also focused on process innovation and the migration to the factory of the future. Underlying these oppor- tunities is the recognition that the PCB indus- try must modernize their manufacturing oper- ations to bring costs down and productivity up, while offering customers greater capabil- ities, quality, and transparency. is innova- tion also creates new opportunities to advance important environmental goals as the industry is both energy and water intensive. With greater government support and indus- try investment in the factory of the future, the cost of European PCB fabrication is likely to become more globally competitive, but Euro- pean PCBs will generally remain more expen- sive than imported boards. ere are oppor- tunities to promote greater price tolerance among PCB customers by strengthening the European industry's value proposition in the context of risk managed sourcing. is can be done through the development of industry- driven, voluntary commercial trusted supply chain standards for PCBs and PCBAs. Threats A few European PCB fabricators are grow- ing and competing globally, but the Euro- pean PCB industry is on a downward trajec- tory. Only a small number of European compa- nies can meet the technological requirements driven by semiconductor advancements. Even though the industry's total revenue is expected to grow modestly over the next few years, the total number of fabricators will decline. Electronics is a cost-sensitive business that requires continual investment in equipment and talent. Survey participants identify cost of labour as the top threat to the PCB industry. e PCB industry in Europe is particularly sen- ing productivity. In the PCB industry, experi- ence matters greatly on technical operations and business strategy given the sudden shis in business cycles and technical requirements. Companies must respond to fluctuations in end-market demand by anticipating industry needs and adjusting their capabilities accord- ingly. Investment planning is difficult as most companies do not have long-term committed orders due to the focus on high-mix, low-vol- ume orders. e U.S. PCB industry is weak- ened as well, but companies there can depend on big defence budgets for financial stability. Opportunities Heightened interest in the electronics sup- ply chain among policymakers has spurred cautious hope across the PCB industry that the EU and Member States will dedicate new resources and policy support to help bolster the industry. Accordingly, survey participants ranked government industrial base support as one of the industry's top opportunities. is ranking reflects the industry's belief that gov- ernment action is necessary and can be trans- formational over the long- term. e conclud- ing section of this paper outlines policy options that governments can pursue to strengthen the PCB industry. ese policy options bring into alignment top industry and EU priori- ties. For example, the green and digital tran- sitions will necessarily create increased Euro- pean demand for electronics. is increasing demand is largely being met by foreign suppli- ers, but the EU has an opportunity to promote European made electronics as a key enabler of these transitions. Likewise, the EU should engage the broader technology community about how to leverage the Chips Act to support broad-based growth across the electronics sector. It is not enough to support the fabrication of silicon in Europe. e region should also ensure, through imple- mentation of the Chips Act, that silicon can be packaged in Europe and that the resulting semiconductor component can be assembled