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February 2015 • The PCB Magazine 59 CHINA OUTLOOK continues volume at a lower cost and the need to develop and insert new technology and support the fund- ing. The OEMs are out of it, many of the ODMs have decided to brand their own product, and now we're seeing the Chinese smartphones in Europe and the U.S. In addition to that, the sup- ply chains have concentrated. WKK is a major supply chain supplier. As the industry consoli- dated, they consolidated their supply chains. So for a small independent that has a breakthrough, to break into the trusted supplier for the large guys running millions of parts is very difficult. We have opposing forces and a new method of marketing the entire thing. Lionel Fullwood: I think you have also got the situa - tion where the local and cen- tral governments supporting China are all for the compa- nies. They understand that this is a competitive world; they understand that their market is essentially outside of China, at least for the foreseeable future, ergo the whole mechanism is such that you could get a shipment out of China in one day. It appears, and this is my personal opinion, that the U.S. government is adversarial rather than supportive of business developments in the U.S. Even clean business, even automated business, because as you said it doesn't matter where that factory is, you can put it anywhere in the world that's supportive, but China is much more supportive of the concept than we pres - ently have in North America. Barry: Interestingly, while I was visiting DSG, Project Manager Mauro Dallora said that the government is encouraging not bringing in employees and instead bringing in automa- tion, because the government realizes they have to go this route to stay competitive. At least that's how I interpret it. Gene: Additionally, they have to do it to gain the world standard in quality. If they don't do this, they can't compete in quality, global - ly. There's an interesting thing yesterday when I went to Hall 2, which focuses just on chemicals and materials. I spoke to the managers of one company, and they said their revenue doubled this past year, but their profits declined. I asked why, and he said to look at all of the copycat, re- verse-engineering companies in chemicals and materials here in China. They are all new, and they're claiming to have everything. They first thing they say is, "My boss used to work for MacDermid," or "My boss used to work for Dow Chemical." The second thing they say is, "I have the cheapest parts." Nowhere do they talk about service, nowhere do they talk about performance, and nowhere do they talk about consistency. So, in a way, many Chinese are succumbing to the conclusion that price is king. Not cost—price. Barry: That's interesting. Gene: It's a different look. Barry: What do you think about China, Hamed? We talked about China a few years back. In the last five years, has your percep - tion or attitude about China shifted at all? Hamed: No, it hasn't shifted that much re- ally. I think that the Chinese are going to be faced with a lot of very difficult problems. As Gene was just saying, everybody is copying each other and it's creating a situation where you re- ally don't have good quality products, because one guy copies another guy who copies another guy. There's no respect for the information, tech- nology and the proprietary technology that you have out there. But given the country as a whole, they're having a lot of problems. First of all, their healthcare system is basically not really in place, and the government is very seriously concerned about how they're going to deal with that. Gene was mentioning a minute ago about the shift in power and how they're now No. 1 and the U.S. is No. 2. They do believe that they are the real economic power today. They do be - lieve that they're building a military which will be able to show the force that they have, as the United States has done for years. I have serious doubts whether they are re- ally there yet or not, because they're copying in that area as well. You know, they just released a fighter jet which copies the F-35, but it will be five or six years before it can really run under interview