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16 SMT007 MAGAZINE I JANUARY 2026 In his December 2025 SMT007 Magazine article, "Get Uncomfortable or Get Run Over: How AI Is Reshaping the EMS Industry," industry expert Mark Wolfe said EMS providers must treat AI-enabled optimization as a foundational investment. Pro- duction lines need to support automated process tuning, process optimization increasingly must be driven by historical performance datasets, and pre- dictive maintenance programs should be in place to minimize unplanned downtime. Wolfe has said that yield stability "is underestimated in the short term, but when combined with advanced pack- aging trends that continue to make rework more expensive, if even possible, those who do not understand and continuously drive defects out of their processes will not survive." While the implementation of AI may be done in phases, organizations that weave these capa- bilities into their operational fabric can expect to deliver faster build schedules and lower defect rates, which OEM customers increasingly expect. Our AI coverage across all three I-Connect007 magazines throughout the year made this clear: Pattern-matching processes like AI require a lot of high-quality data. This shift to smarter processes requires a differ- ent kind of workforce. Data engineering and pro- cess analytics skills are moving from nice-to-have to essential. Engineers must be able to model data and diagnose the patterns that AI tools reveal to fully capture the value of the new processes. While all this is changing on the factory floor, design-tool vendors are experiencing their own transformative pressure. Designers increasingly expect manufacturability feedback in real time, directly within their CAD environments. The days when DFM reviews occurred only at the end of the design cycle are largely behind us. To satisfy these expectations, EDA companies must develop bi-directional data-sharing methods for the entire manufacturing chain, including EMS firms and PCB fabricators. Manufacturers need to see design intent; designers need to see how their design decisions affect manufacturability in real time. This means that vendors delivering end-to- end, closed-loop DFM systems linking CAD, CAM, and even MES will be the design flow disruptors, especially when the tools are priced to be afford- able by more than just corporate clients. Supply Chain Localization and Resilience Regional diversification shows no sign of letting up. In fact, multiple McKinsey Global Value Chain Reports in 20242 point to electronics as one of the industries undergoing the most signif- icant long-term reconfiguration. The Global Elec- tronics Association published a position paper in 20251 detailing how the electronics manufacturing industry is the most integrated supply chain on the planet. Companies are prioritizing resilience, which affects not only component sourcing but also sec- ondary and tertiary factors, such as manufacturing location, reproducible processes, and logistics. Having learned our lesson on over-optimiza- tion in the supply chain, OEMs now expect sup- ply chain redundancy, often seeking vendors and suppliers that can replicate processes across geo- graphically distributed facilities. For EMS providers, localized manufacturing is rapidly becoming a key differentiator, both in the suppliers they choose and in their value proposition to their customers.3 PCB fabricators in North America and Europe are feeling the squeeze. Demand for manufacturing capacity for HDI and UHDI, rigid-flex designs, and IC-substrate technologies is increasing. Survey data in recent presentations by the Global Elec- tronics Association4 , 5 suggest that these advanced capabilities align with the primary market seg- ments being served by North America and Europe. These capabilities command a premium, but only when fabricators can demonstrate the necessary speed, traceability, and reliability. As reshoring continues, fabricator consolidation is picking up 2