Application Watch: EMS evolution toward Industry 4.0

Goal for global competitiveness sustains machinery acquisition and advances initiatives toward smart manufacturing.

From constant upgrades in production and testing equipment, efforts to boost competitiveness in China will eventually move toward smart manufacturing or the application of Industry 4.0 – otherwise known as the Industrial Internet of Things. The potential advantages of high efficiency and, ultimately, a low-cost production solution based on mega-data, AI and robotics await.

In China's EMS sector, machinery acquisition has been going on for years. Emphasis is on SMT as providers build up industrial capability to compete in the domestic and overseas markets.

Tortai Technologies Co. Ltd is one in a long list of manufacturers purchasing new machines. It spent $88,000 on SMT and test equipment recently, and will continue to allocate for more in the coming year. SHC Electronics Ltd invested $1.5 million in SMT and AOI equipment, reflow-soldering machines and SPI testers, and will sustain the upgrades in the next one to two years.

On a more ambitious plan, Suzhou Etron, a major EMS company in the country, invested $176 million in the second phase of its smart manufacturing project in 2019. The facility, covering an area of 169,000sqm, is scheduled to realize mass production by the end of 2020, and will double the company's production value.

Product lifecycle management, enterprise resource planning and other management systems are widely adopted in China as well.

In addition to highlighting improvements in manufacturing processes and equipment, domestic manufacturers attract customers by accommodating small-volume orders, ensuring shorter turnaround times and offering better price-performance ratios. They also provide aftersales services.

Most are small and midsize, and have to compete for attention in a market populated by industry giants. The major homegrown players are Universal Scientific, Kaifa and 3CEMs, all of which are listed in the top 50 EMS suppliers in the world.

Foreign companies also operating in China include leaders Foxconn, Pegatron, Flex, Jabil, Wistron, Sanmina, Celestica, New Kinpo Group and Venture.

Manufacturers congregate in the Pearl River Delta and Yangtze River Delta regions, mainly in the cities of Shenzhen, Dongguan, Suzhou and Ningbo. There are also factories in the central parts of China, where labor costs are lower than in the coastal areas.

Up & running again

Despite factory shutdowns that resulted in sales drop of 10 to as much as 30 percent at the beginning of the COVID-19 pandemic, most EMS providers in China have remained optimistic. With gradual recovery seen in recent months, there are even expectations of growth in late 2020, which will carry over and possibly be higher in 2021. Suppliers predict at least a 10 percent increase in the next 12 months, anticipating about the same upturn in export shipments.

Tortai, which has resumed normal operations, is looking to realize a 10 percent sales rise in 2021, and has a similar positive outlook for overseas deliveries.

Based on shipments of domestic companies, nonconsumer electronics products have a bigger share than consumer electronics. These account for up to 80 percent of the volume, and cover automotive, communications, medical and industrial applications. At Shenzhen Baiqiancheng Electronic Co. Ltd, the portion is 65 percent, which can be adjusted, depending on orders.

Available solutions

EMS providers in China offer partial and full turnkey services. Most have facilities for through-hole and SMT assembly. Capability to process components encompasses different sizes as small as 01005, 0201, 0402 and 0603, and packages such as SO, SOP, SOJ, TSOP, TSSOP, QFP, BGA and UBGA. Placement can be done on single-, double-sided or multilayer PCBs, which may be rigid-flex, flexible or HDI, according to specifications.

As assurance, the majority of companies ensure manufacturing processes are compliant with ISO 9001, 13485, 14001, ISO/TS 16949, IATF 16949 and OHSAS18001 standards, and products with industry guidelines, including CE, RoHS and UL.

EMS providers usually purchase ICs from foreign companies, including TI, ADI, Infineon, STMicroelectronics and ON Semiconductor. They also turn to domestic suppliers such as Silan, CR Micro and Awinic. PCBs, passive components and other inputs are sourced locally or overseas, depending on customers' requests. A few manufacturers have in-house capability for PCBs.

The cost of multilayer ceramic capacitors dropped in 1H2020, but that of other components did not fluctuate much.

If there are no significant cost changes in the months ahead, EMS companies will keep their prices at current levels. A few might offer lower quotes to win more orders.

The products in this gallery have been handpicked by our China-based market analyst for representing current trends in PCB assemblies from China makers.

50x30mm to 520x570mm PCB assembly

On a rigid, flexible, rigid-flex, copper or HDI board, this PCB assembly from SHC Electronics Ltd, the SHC-2020007129, integrates 01005, BGA, QFP, QFN and TSOP components using SMT method. Minimum BGA distance is 0.3mm, which is ensured with X-ray inspection, and component height 0.2 to 25mm. Pick-and-place precision is ±0.01mm. Product dimensions are 50x30mm to 520x570mm.

The negotiable minimum order has a 10-day delivery lead time.

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PCB assembly on multilayer high-density board

This PCB assembly from Shenzhen Baiqiancheng Electronic Co. Ltd, the BQC-PCBA-SMT, is based on a multilayer high-density PCB with an FR-4 or CEM-3 base and HAL, gold-plated, Alpha Level or ENTEC surface finish. The board has 0.5 to 6oz copper, 157.48mil minimum line width and spacing, and as small as 0.2mm holes. The maximum panel size is 480x580mm.

The minimum order is negotiable. Delivery lead time is 5 days.

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PCB assembly, uses 1.6mm-thick board

Shenzhen Topwell Technology Co. Ltd's Top-EMS model is a UL-listed and RoHS-compliant PCB assembly. The board used has as small as 0.2mm holes and 3.94mil minimum line width and spacing. Board thickness is 1.6mm±10 percent.

The minimum order is negotiable. Delivery lead time is 7 days.

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PCB assembly, through-hole & SMT

Tortai Technologies Co. Ltd's PCB assembly, the GS-571, has conformal coating. Through-hole and SMT methods, employing wave and reflow soldering, are used. The product has 0201, fine-pitch, BGA, QFN and IC components with 0.787in maximum height, which are mounted on a high-Tg, single-sided, multilayer or flexible PCB. The controlled impedance board has buried and blind holes, and come in sizes of 0.2x0.2 to 25.2x24in.

The negotiable minimum order has a delivery lead time of 15 days.

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