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News

BLOOMINGTON, MN – Vitronics Soltec will relaunch its Five Steps to Lead-Free Soldering seminar with a free one-day event on Nov. 20 in Bloomington, MN.

The new series is the QS Edition: Motivated by Quality, Focused on Solutions.

Jasbir Bath, of Bath Technical Consultancy, will give the opening address, Electronics Assembly Trends, and will present Best Practices in Assembly Processes.

To register, contact John Chugg at (815) 238 7534 or Steve Block at (952) 903 0333, ext. 16.

JACKSON, MI – The New York Stock Exchange has notified Sparton Corp. that it is no longer in compliance with the exchange’s listing standards. The EMS provider is considered below the criteria since the company’s market capitalization was less than $75 million over a 30 trading-day period and, at the same time, its shareowners’ equity was less than $75 million.

SAN JOSE – The Semiconductor Industry Association is calling on Congress to put aside its differences and agree on a plan to address the financial crisis.

“There is broad agreement that the federal government must take action promptly to address the current financial crisis,” said SIA president George Scalise in a press release. “The issues that contributed to the failure of the recovery legislation Monday can be resolved, but it will take bipartisan cooperation.

SIA said Congress must restore consumer confidence by taking action on a recovery package this week. “Consumer demand accounts for more than two-thirds of the U.S. economy,” Scalise said. “A slowdown in sales of a broad range of consumer products such as personal computers, cellphones, and entertainment electronics would have an adverse impact on semiconductor sales in the fourth quarter, which is normally the strongest quarter for the chip industry.

“The entire supply chain including our suppliers and customers will be harmed if access to credit becomes difficult. Restoring consumer confidence must be a top-priority in crafting legislation that can achieve strong bipartisan support. As long as consumers have major concerns about job security, the value of their retirement portfolios, and their home equity, consumer spending could be curtailed, leading to an overall economic slowdown,” he said.

BILLINGSTAD, NORWAY -- Kitron AS has received new orders from KDA worth some NOK 40 million for the "Protector" weapon control system.

The products will be delivered in the first and second quarter 2009. The new orders bring the value of Kitron's production for KDA to NOK 113 million, with additional ordered expected in 2009.

Kitron had revenue of about NOK 1.9 billion in 2007 and has about 1,400 employees. It is a Top 50 EMS provider, according to Circuits Assembly's 2008 Directory of EMS Companies.

EL SEGUNDO, CA – Already reeling from a major downturn in business conditions, DRAM suppliers now face another challenge: raising money for servicing debt and for funding capital spending, according to iSuppli Corp.

“Although the epicenter of the credit crisis is in the United States, banks from all over the world are being strained by the US housing market and by the destabilizing impact of bank failures in the nation,” said Nam Hyung Kim, director and chief analyst for iSuppli.

“Even with the expected intervention by the US government, this crisis means the cost of capital will rise because cash-strapped banks will be reluctant to take on big, risky ventures. This is a particular challenge for the capital-intensive DRAM manufacturing business. DRAM suppliers that already are facing cash issues soon may not be able to service debts that are coming due soon. Furthermore, DRAM suppliers may encounter problems in trying to finance their capital expenditures.”

Kim warned that some DRAM firms would face serious liquidity issues in the near future, based on the pace of their cash burn and the maturation of their short-term debt.

“Amid weak market conditions and the credit crunch, cash management has become the most critical issue facing DRAM suppliers,” Kim observed. “This will have the impact of reduced capital expenditures among DRAM suppliers in early 2009.”

While some observers have identified DRAM supplier Qimonda AG as being the company most at risk because of current conditions, iSuppli believes the German firm is on more solid ground than many of its competitors.

“Qimonda actually has a relatively good cash balance and a low debt ratio for potential leverage in the future compared to many other DRAM suppliers,” Kim observed.

The credit crisis comes on top of rapidly deteriorating conditions in the DRAM market, says the firm.

iSuppli on Sept. 22 cut its rating of near-term conditions for DRAM suppliers to negative, from neutral, as a result of severe oversupply, weak demand, unexpectedly sharp price declines and the approach of a seasonally slow period for the market.

DRAM demand had been strong until the second quarter. However, the situation changed starting late in the third quarter. Worrying signs for PC demand include a warning from Dell that sales growth would fall short of previous expectations in the third quarter. Furthermore, several retail outlets also reported disappointing sales forecasts for the third quarter, says iSuppli.

Beyond that, woes in the financial sector may impact DRAM sales. The financial area is one of the major corporate markets for PCs, and current challenges in this industry, including large-scale layoffs and delays in purchases because of the uncertain economic situation, represent a further downside for PC sales, according to the firm.

On the supply side, DRAM inventories have swelled far above nominal levels, not only among the memory suppliers themselves, but also for the channel and OEMs. Furthermore, DRAM suppliers have been aggressively releasing inventory to the spot market.

“The growing margin between spot and contract prices is a bearish sign for future DRAM pricing and demand,” Kim noted. “OEM contract prices for 2Gbyte PC DRAM modules will further decrease to the $20 to $25 level, down from the current $30 to $35 range, due to the flood of inventory. This level of pricing represents a ‘dead-zone’ for manufacturers, because it is less than the variable costs for the most DRAM suppliers.”

Some of the DRAM suppliers will stop shipping commodity DRAMs to reduce their cash burn early in the fourth quarter. However, this won’t be sustainable. As the end of 2008 approaches, suppliers will be under tremendous pressure to meet their annual budgets, which will worsen market conditions further in the future, says iSuppli.

“Perhaps the only good to come out of the economic downturn is that DRAM players will lack the cash to over-invest, thus curbing supply growth,” Kim said. “This will bring an end to the oversupply on the market, a situation that has been so disastrous for the industry in 2007 and 2008. The market eventually will turn around – although not for a few quarters at least. However, the timing of the DRAM recovery will hinge on the timing of the economic recovery, which no one can determine at this time.

“However, there is no good news in the DRAM industry right now,” Kim added. “The DRAM crisis is continuing along with the financial crisis. Until iSuppli sees meaningful production cuts from tier-one suppliers or near-term major consolidation, we will maintain our negative rating for near-term conditions for suppliers.”

AUSTIN, TX – The growth of flip chip and wafer level packaging is a bright spot in the industry, says researcher TechSearch International. The firm projects a compound growth rate of more than 14% for flip chip units and 14% for WLPs between 2007 and 2012.

The drivers for flip chip continue to be performance and form factor. The use of flip chip for a variety of wireless products will contribute to the growth in 2009. An increasing number of suppliers of ASICs, field programmable gate arrays, DSPs, chipsets, graphics and microprocessors are expanding use of flip chip with solder bumps and copper pillars in package. Flip-chip-on-board continues to be found in automotive electronics, hard disk drives and watch modules. Many companies are planning to use micro bumps through silicon via products, according to TechSearch.

The growth in WLPs is driven by increased demand for thinner, lighter-weight portable products, but WLPs are adopted for both form factor and performance reasons. WLPs have typically been used for low pin count (≤50 I/O) small die size applications, including analog devices such as power amplifiers and battery management devices, MOSFETs, image sensors, controllers and integrated passives. However, WLPs are now an option for larger die sizes with higher pin counts (≥100 I/O), says the firm.

Gold bump demand continues to be dominated by LCD driver ICs, but die shrink has limited the growth in number of wafers. An increasing number of gold stud bumped devices are also shipping.

SHANGHAI – Trace Laboratories has opened a testing laboratory in Shanghai.

The lab supports material analysis, functionality, design validation, dimensional measurements and process validation testing. Trace sees the new facility as an “important step in assisting customers with their product validation in a timely fashion.”

The lab is in a high-growth market, with production geared for the global marketplace. Trace believes this will save its customers time and money by removing the need to ship products prior to qualification.

TAIPEI – Taiwan Union Technology Corp. this week responded to a competitor’s allegations of patent infringement with a stern denial.

In a statement, TUC demanded Isola USA Corp. immediately retract its allegations and related legal procedures and “stop harassing TUC customers and interested companies at once.”

Last week, Isola alleged that TUC product numbers TU-662 and TU-752 infringe China patent no. 123529.

“TUC believes that Isola’s allegation of patent infringement is groundless,” TUC said in a press statement. Extensive testing show the composition of TU-662 and TU-752 laminates by TUC and outside experts and scholars are outside of the scope of the patent, the company asserted.

On advice of its legal counsel, TUC declined to disclose the name of the outside testing facilities, the company told PCD&F, a sister publication of CIRCUITS ASSEMBLY.

The company further stated it would will take “all available legal actions” to protect it from damages to its business and reputation.

Isola also filed claims against ITEQ; that company has not publicly responded.

Key words: laminate

WASHINGTON, DC – TechNet, the bipartisan political network of CEOs that promotes the growth of the innovation economy, today urged Congress to approve the economic rescue package now under consideration.

"We urge Congress to approve the economic rescue package now before the Senate," said Lezlee Westine, president and CEO of TechNet. "Not only is the bill essential to stabilizing our nation's economy, but it also includes vitally important tax incentives for clean energy and research and development that can help create thousands of high skilled jobs in America.

"We strongly believe the financial package before Congress is far too important to the stability of our economy to let fail," said Westine in a press release. "This measure is not just for financial services, and if no action is taken will hurt businesses across every sector because we are all affected by problems in the credit markets. The ramifications would quickly boomerang throughout the whole US economy and we simply cannot let that happen."

EL SEGUNDO, CA – PC demand continues to defy economic and financial woes, with second-quarter worldwide unit shipments growing 14.5% year-over-year to reach 70.2 million units. No changes occurred sequentially among the top five OEM rankings, says iSuppli Corp.

Overall PC shipments came in higher than forecast, said Matthew Wilkins, principal analyst, compute platforms for iSuppli. “iSuppli maintains its enthusiasm for the PC market in 2008, despite the challenging conditions. iSuppli’s latest forecast for the 2008 PC market estimates unit growth of 12.5%.”

“Hewlett-Packard continued its impressive start to 2008, with shipments of 13.4 million units, maintaining its worldwide No. 1 ranking at a share of 19.1%,” Wilkins said. “However, the second quarter represented Dell’s fourth consecutive quarter of market share growth, with the company delivering shipments of 11.2 million units and a share of 16%.”

Acer and Lenovo continued their fierce scrap, although with no change in rank, says the firm. Acer held onto third place with a 9.5% share, and Lenovo maintained fourth place, with a 7.9% share.

Lenovo proved Dell wasn’t the only top five OEM that could grow share, delivering a 1% sequential increase in share to reach 7.9%.

The second quarter was the fourth consecutive quarter during which Dell gained market share, noted iSuppli.

MORRISVILLE, NC – Juki Corp., a provider of automated assembly lines, closed the third quarter with record growth of more than 35% year-over-year.

Sales of surface mount placement systems grew nearly 40%, complemented by more than 20% growth in the selective solder line.

Juki reported the strong start of the FX-3 high-speed placement system was a major factor in 2008 sales.