Electronics Manufacturing Equipment: Where are we Headed

By Sudeshna Das

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The Indian electronics manufacturing equipment industry is bound to evolve with the quickly changing electronics manufacturing landscape of the country.

The role of manufacturing equipment is crucial to ensure the quality and functionalities of any electronic device or component. The entire processing life cycle of an electronic device travels through various manufacturing equipment, from being a printed circuit board (PCB) to a finished electronic device.

According to changing application requirements, electronic devices and PCBs also need to be developed in various shapes, forms and sizes. The ever-increasing complexity of electronic assembly and miniaturisation of components enhance the demand for advanced manufacturing equipment.

As PCBs and electronic components become more miniaturised than before, manufacturers face the challenge of placing accurate deposits of small components on miniaturised boards. This, in turn, fuels the demand for advanced manufacturing equipment with a high degree of reliability and accuracy.

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Technological advancements—which are necessary to meet high-performance expectations in electronics—combined with today’s high-speed production, complete process automation and stringent quality assurance standards will drive the demand for manufacturing equipment.

This study presents the current trends and growth opportunities in the Indian electronics manufacturing equipment industry with a special focus on surface-mount technology (SMT).

Market opportunities

According to a research report published by MarketsandMarkets, the SMT market is expected to reach a turnover of US$ 5.42 billion by 2022, growing at a CAGR of 8.9 per cent between 2017 and 2022. The market’s growth will be primarily driven by higher demand for miniaturised consumer electronic products and enhanced adoption of electric vehicles (EVs) with advanced features for connectivity, entertainment and safety.

The Indian electronics manufacturing equipment market is also bound to grow along with the electronics manufacturing sector in the country. The Indian electronics manufacturing industry is on track towards achieving its full potential in terms of manufacturing and designing capabilities. India’s domestic electronics production for the first time increased beyond imports in FY 2016-17, as according to government sources, domestic production stood at US$ 49.5 billion, higher than the US$ 43 billion spent on imports.

This seems to be an early signal indicating that the government’s Make in India initiative is beginning to make inroads towards improving the state of domestic manufacturing. This, in turn, will drive the demand for manufacturing equipment. According to industry experts, the manufacturing equipment industry in India is worth approximately about half a billion US dollars, including imported and local.

For India, industry experts expect Make in India campaign, key policy initiatives by the government, deep-rooted entrepreneurship spirit, and domestic demand for consumer electronics, telecom equipment, automotive, aeronautics, defence and medical electronics verticals to fuel growth. Moreover, high throughput and high-efficiency manufacturing initiatives, based on Industry 4.0 and Smart Factory—which are being taken up by electronics manufacturers to upgrade product lines—will also augment this pace. SMT will drive the advanced manufacturing equipment market.

Growth drivers

Electronics manufacturing service (EMS) providers need an increasing number of SMT equipment product lines to meet the demand from customers across different industry verticals. In addition, many original design manufacturers (ODMs) have also started manufacturing plants—rather than just designing equipment—to overcome the increasing delays from EMS providers. This will further drive the growth of the SMT equipment market.

The trend for adopting SMT assembly lines will be bolstered further by increasing demand for higher frequency, highly integrated and smaller devices in consumer electronics, automotive, industrial automation, process control, telecom, the Internet of Things (IoT), computing, storage, aerospace and defence markets.

According to industry experts, major demand-generating sectors are:

  • Automotive
  • Consumer electronics
  • Telecom equipment (including mobile handsets)
  • Industrial electronics (including power and energy products)

Demand for SMT devices in the automotive segment has increased due to their ability to meet the needs of critical systems with zero defects. Number of electronic components used in EVs is higher compared to conventional vehicles, since EVs have an electric motor, battery and other complex connections to ensure optimum utilisation of power. Owing to the critical role of electronic components in these EVs, surface-mount devices are used, as these are lighter, occupy less space, are safe and last longer.

Forecast on major demand-generating application sectors
Forecast on major demand-generating application sectors

The consumer electronics segment is transitioning from manual, analogue systems to digitised, automated control systems. With increased use of smart portable devices and wearables, there is a heavy size constraint on the PCBs used. This could give a first-mover advantage to a manufacturer who can invest in new SMT equipment that supports miniaturised PCBs or components. Feeder technology, flexible gantries and high-accuracy optical encoder systems are examples of product innovations as a result of technological advancements. The majority of industry experts indicated that set-top boxes (STBs) is the most demand-generating product segment.

Demand for SMT equipment is also high in the telecom sector (including mobile handset manufacturing) and energy segments.

SMT equipment in demand

Placement equipment represents the largest product segment within the SMT equipment market. A steady demand in this segment is attributed to the growth of SMT assembly lines to enable efficient electronics manufacturing practices and innovation related to product miniaturisation and complex circuits. For the same reason, soldering and printing equipment segments are also expected to experience decent demand. Equipment like selective soldering machines, PCB cleaning machines and assembly lines are in demand.

Necessity for production speed enhancement and flexibility of quality assurance procedures has generated demand for advanced SMT inspection systems, including automatic X-ray inspection (AXI) and automatic optical inspection (AOI) systems. AXI equipment is expected to gain from the integration of computer tomography and intuitive programming. Whereas, AOI equipment is expected to become more popular because of the use of machine-vision-based algorithms that enable easy programming, flexibility and enhanced ability to detect faults quickly while minimising false call rates.

Emerging trends in SMT

Industry experts also shared insights on emerging trends that will shape the SMT manufacturing equipment market in India. They believe that there are many advantages of using this equipment, such as lower manufacturing costs, higher component density, as well as simpler and faster automation leading to smart factories. Here is a collation of their views.

Focus on precision

Technological advancements in manufacturing will largely focus on bringing precision into the manufacturing process to reduce defects, while optimising the use of assembly operations to improve productivity.

Demand for one-stop solutions

There is an increased demand for integrated solutions to enable fully-automated control solutions. Therefore customers are shifting from using individual SMT machines to integrated one-stop SMT assembly lines to get a competitive advantage.

Shift to 0201 geometry

One of the key trends is that, India has moved straight to 0201 geometry, leapfrogging the phase of making larger SMT products.

Affordable equipment for small products

Low-cost SMT equipment lines for small products are becoming affordable. This trend is already driving the market well.

Demand for small things

With rapid increase in the use of smaller IoT devices (known as things), high volumes needed will drive the SMT market. Moreover, almost all component vendors have migrated their processes to SMT, to increase manufacturing speed, use advanced complementary metal oxide semiconductor (CMOS) technology and due to decreased interconnect widths in ICs. This has essentially driven the components industry to adopt smaller packages.

Machines for smart factories

In the era of Industry 4.0, everything will be connected through the Internet and the cloud, enabling factories to function as a smart system rather than individual parts. Hence, as an integral part of a smart system, manufacturing equipment also need to enable automation, data collection and connectivity with the following features:

Preventive maintenance

One of the main tenets of Industry 4.0 is data collection. Manufacturing equipment with appropriate sensors will collect different kinds of data, including data on how much the machine has operated, conditions it has operated in and condition of the components of the tool.

By collecting this data, machines will be able to estimate when a component needs replacement. For example, the system would alert operators to replace a bearing that has experienced a heavier load and more frequent use sooner than a less-used one. This predictive maintenance could keep machines running more efficiently and prevent downtime.

Improved utilisation

Manufacturing operations do not always use equipment as efficiently as they could, and idle time is a frequent occurrence. It is difficult to determine the reason for this idle time. However, data collection on things like line change, program stops and feed holds improve utilisation of manufacturing equipment.

Energy savings

Smart manufacturing equipment can collect data on energy usage patterns and help save energy costs. Smart meters and other innovations help energy to flow more efficiently. A smart factory could use data on energy demand to ramp up production accordingly. Thus, energy cost is low. Smart equipment can also shut down or reduce their power usage when not in use.

Preventing improper usage

Smart manufacturing equipment can also identify improper usage cases. For example, if a machine knows the amount of force or temperature it can withstand as well as how the operator plans to use it, it can send out an alert if it detects conditions outside of that norm. This could help prevent misuse caused by human error or malfunction, which could avoid downtime as well as worker injury.

Enhanced quality assurance

Manufacturers spend a lot of time and resources on quality assurance, taking care not to let any faulty products slip through. Smart manufacturing equipment can collect this massive pool of data that smart machine tools would collect about their use. This could help them spot potential quality issues. If a machine does not operate in the expected way, it would show up in the collated data. This, in turn, would help with traceability in manufacturing and improve quality by reducing natural variations that come with human action.

Minimising the role of humans

In smart factory systems, a drastic change will happen with respect to the roles of human employees. There will be a shift from physical operation by humans to operating, monitoring and analysing data through a computer, and providing oversights to automated operations.

Moving forward

Worldwide, the electronics manufacturing equipment market and EMS industry grow hand in hand. However, the Indian EMS industry has not achieved enough maturity in comparison to other Asian countries. Most Tier 2 and Tier 3 EMS vendors still act as assemblers—they just do the job work of PCB assemblies—rather than making the entire unit or taking on the complete production of an electronic device.

Transformation of EMS players from assemblers to complete service providers will not only enhance the demand for electronics manufacturing equipment but also help EMS players get a competitive edge in the market.

Moreover, the electronics manufacturing equipment market in India is predominantly made of imported products. Local manufacturing of these equipment is negligible. This trend needs to be changed.


Sudeshna Das is director at ComConnect Consulting

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