Application Watch: Mainland China EMS providers increase production capability

Companies in mainland China's EMS sector continue to acquire advanced equipment.

Electronics manufacturing services' primary benefit of speeding up the production process at reduced cost while allowing resources to be allocated for design, marketing and brand management continues to attract businesses.

In mainland China, this sector has become a major force in the electronics industry, having grown to more than a thousand providers that include leading foreign companies. To thrive in this competitive environment, local enterprises have been striving harder for market attention. They keep improving manufacturing capability, investing in facility upgrades and skilled manpower, and expanding services. For many, the last already covers product design and development, materials and components sourcing and management, PCB assembly, product testing, logistics and aftersales.

An important strategy adopted by most mainland EMS providers is high-mix/low-volume production, which enables them to get orders usually turned down by foreign players.

Nurturing the markets outside the intensely competitive consumer electronics has also been working well for local companies. In fact, nonconsumer electronics products or those for the communications, industrial, automotive, medical and new energy sectors account for more than two-thirds of shipments. The last three are expected to draw more domestic enterprises in coming years.

Indicative of this effective approach is rising output, which averaged about 10 percent for the majority of mainland suppliers in the past year. Spurred by 50 percent sales growth in 2018, Shenzhen Makerfabs Corp. built a new factory in the past year, and will be purchasing additional advanced manufacturing and test equipment to meet its annual production expansion target of 10 to 20 percent. For 2019, Kenling Electronics Co. Ltd is on track to reach a 20 percent turnout increase. The latter maker is eyeing up to 20 percent revenue boost in local and overseas shipments in 2020. It allocates 95 percent of yield for export.

The EMS sector, which has a prominent share of the aggregate sales value of the mainland's electronics manufacturing industry, is projected to keep growing by 5 to 10 percent.

The leading local companies in this line are Universal Scientific, Shenzhen Kaifa, Prime Base and 3-C Tech. Their Taiwan counterparts that are also in the mainland include Foxconn, Pegatron, Wistron and the New Kinpo Group, and so are multinational companies from Canada and the US, Celestica and Flex, and US EMS provider Jabil.

Domestic and international companies have kept their facilities in key cities such as Shenzhen, Dongguan and Zhuhai in Guangdong province, Suzhou and Changzhou in Jiangsu, and Yantai in Shandong. A number have set up factories in the central region to take advantage of lower labor cost there.

In spite of strong competition, more local and foreign companies are expected to join the line and establish facilities in these major electronics hubs. This, however, might force small workshops out.

Full & partial turnkey services

Local EMS companies are capable of SMT and DIP production, and can handle full and partial turnkey projects. They use mainly pick-and-place, wave-soldering and bonding machines, reflow ovens, and automated optical inspection, in-circuit testing and X-ray equipment. The majority of machinery is imported and includes Yamaha and JT units.

Providers offer 0.5mm minimum BGA precision, 0.4mm minimum IC precision and up to 30- layer PCB assemblies.

Shenzhen Makerfabs offers turnkey services, including to startups. It maintains a team of engineers with experience in the Internet of Things and smart home projects, and those based on Arduino and Raspberry Pi boards. Its clients include HDR of Germany, the Futura Group of Italy, Faurecia of Poland, and Johnson & Johnson and Luxer One of the US.

Xiamen Hi-Bit Electronics Co. Ltd provides product design and engineering, manufacturing and supply chain management. It has facilities for PCB assemblies, tooling, final assembly and testing. Hitachi, Jabra and Philips are among the maker's major customers.

Kenling's factory is equipped for PCBs and PCB assemblies. The supplier can handle components sourcing, plastic and metal injection molding, and surface finishes.

At its own facility, Fullwill Technology Co. Ltd conducts PCB design and layout, PCB assemblies from SMT and DIP to box build, contract manufacturing, testing and other processes. Its key clients include Fuji Film, Hitachi, Philips and Toshiba.

Most EMS providers in the mainland turn out products with CE, FCC, RoHS and UL approval.

Makers obtain ICs, passive components, connectors, PCBs and other electronics inputs from sources specified by customers. Some turn out PCBs in-house. ICs are usually from foreign companies such as Avent and Arrow.

The cost of passive components rose in the past year, driving prices up. It is anticipated to go down in the months ahead and 2020 and stabilize product quotes.

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

0.3mm-pitch PCB assembly

The model PCB Assembly Surface Finished from Fullwill Technology Co. Ltd can accommodate BGA, CSP and LLP components with 0.3mm pitch. The PCB adopted is 50x35mm to 550x350mm.

The RoHS-compliant unit has a negotiable minimum order. Delivery lead time is 7 days.

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PCB assembly has ±0.03mm placement precision

The PCBA for Digital Multimeter model from Kenling Electronics Co. Ltd is a PCB assembly with as small as 0201 components with a 0.4mm minimum BGA pitch and those with a 0.3mm minimum lead pitch. Placement precision is ±0.03mm. The unit uses a 50x50mm to 400x310mm PCB with thickness ranging from 0.4 to 6mm.

The unit has a negotiable minimum order. Delivery lead time is 7 days.

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PCB assembly with 0201 components

Shenzhen Makerfabs Corp. can mount components up to 0201 and SOP, CSP, SSOP, PLCC, QFP, QFN, BGA, FBGA and uBGA on this model MEKFAB PCB assembly. The BGA size is 8x6mm to 55x55mm, the minimum IC pitch 0.2mm and the minimum leg distance 0.3mm. Copper thickness is 0.5 to 5oz.

The negotiable minimum order has a 7-day delivery lead time.

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PCB assembly on up to 8-layer board

This PCB assembly from Xiamen Hi-Bit Electronics Co. Ltd, ComplexPCBA model, consists of a single- to 8-layer board, and 0201 BGA and LGA components. This mounts a total of 3,168 components.

The order quantity is negotiable and delivered within 7 days.

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