Grab your headphones and hit play to hear our conversation with Gerard van Dierendon from Unimicron, a global PCB manufacturing leader. We venture into a deep discussion about the shifting trends in manufacturing industries. Notably, we touch on the topic of reshoring, which has been fueled by geopolitical concerns and supply chain security, but we find that not all industries share the same sentiments.
Sustainability is an issues and Gerard reveals the need to provide CO2 footprints with their boards. He shares how their German facility has embraced these demands, ensuring transparency in their CO2 accounting, which includes logistics and electricity consumption. As we navigate the European skill shortages, we explore how automation is being leveraged to combat this issue. Listen in as Gerard gives us a unique perspective on how Unimicron has maintained a loyal workforce amidst these challenges.
PCB@C-Level was generously hosted at productronica 2023 by Adeon technologies - learn more at https://www.adeon.nl
Like every episode of EMS@C-Level, this one was sponsored by global inspection leader Koh Young (https://www.kohyoung.com) and Adaptable Automation Specialist Launchpad.build (https://launchpad.build).
You can see video versions of all of the EMS@C-Level pods on our YouTube playlist.
Speaker 1:
Hello, I'm Philip Soten. I am on the Adion Technologies Board at Productronica 2023 and I'm joined by Gerard from UniMicron. Gerard, thanks for joining me. Let's just start with a very brief introduction to you and to UniMicron as a global business, but specifically here in Europe.
Speaker 2:
UniMicron is a global player for the production of PCBs. They have facilities in Taiwan, in China, in Japan and in Germany, and I am responsible for the German facility. And how many people do you have here in Germany? We have 480 people at the moment. All in one single plant. All in one single plant.
Speaker 1:
yeah, and how old is that facility?
Speaker 2:
The facility is founded in 1949, so it's one of the older facilities in the world. It's even the place where they invented the multi-layer PCB.
Speaker 1:
Wow, that's really interesting. One of the trends that we're hearing about at the moment in manufacturing generally is some reshoring for geopolitical reasons and all kinds of other reasons supply chain security when you're in a global organization. That doesn't mean winning or losing business. It maybe means manufacturing in a different location. Have you seen much demand from your customers here in Europe saying, hey, we need these parts manufactured in Europe and maybe these are not so critical.
Speaker 2:
We see different attitudes. The automotive industry they believe it in their mouth but at the end of the day if you go to the purchasing department they have to pay the price and they say, okay, we buy it anyway in China. If you go to the industry or the renewable industry in Europe, they really do what they say. For example, a company like Miller in Germany. They decided to move a certain share of the parts of the PCBs they were buying in the past in China. They buy them now in Europe.
Speaker 1:
And when you look at the facility that you have in Europe, what's the overall trend? Has the share that you've had there been shrinking and has it started growing again? What's?
Speaker 2:
the movement, we see that the automotive is still difficult. Automotive has a few problems. First of all, it's the corona after effect. That's problem one. The second problem is that the automotive is still a bit old fashioned. I mean Bosch and Hella and Conti. They have got huge problems themselves. They have to compete now with Chinese competitors, which is hard for them, and they still do it the traditional way and I think that's not the way it's been done. If you look at renewable energy, solar and industry, it's a bit different. They are a bit more how shall I say this? A bit more proactive and they really react on what's happening in the world. So this is what you were mentioning removing certain shares from China to Europe is really happening there.
Speaker 1:
It's interesting that it is sustainable, environmentally important industries. Are they not just looking to manufacture in Germany, but also think long and hard about the sustainability of your facility?
Speaker 2:
Oh, they do. We have to supply CO2 footprints with our boards. Several global players. They ask us okay, you can get this order, you have to produce this board, but the CO2 footprint you have to deliver it with them. So you have to tell us how much CO2 is produced by producing that board. And that's inclusive of everything. That's including the logistics of the people who work with me. That's including the electricity consumption. That's including everything.
Speaker 1:
And also downstream from you. So people like your laminate suppliers, people like your materials and chemical suppliers, or is that not that much scope yet?
Speaker 2:
That's also, but that's pretty easy for us because we just say we want to have this. It's more difficult to our customers they're also included and our customers. They don't tell us what they do with the boards.
Speaker 1:
Yeah so that certainly has an impact. One of the other areas we're hearing about in Europe is skill shortages and people perhaps managing that with automation to mitigate that risk. We talked earlier and you said you have a very loyal team. You're in quite a quite a rural location so retaining staff isn't so hard, but automation really is a reality of where we need to go in this industry.
Speaker 2:
We built a new plant in 2017-18, but it was the inner layer plant after the fire and we decided to automate it as high as we could. At the end of the day, the number of people who are working there is still the same. It's only different people and you can upskill a bit more easy. But the biggest advantage is that on a Monday morning they don't have a bad mood.
Speaker 1:
Yeah, absolutely, and it's interesting. So you know, when I look at that opportunity, it's it's more skilled people, perhaps more sustainable jobs, but you should be able to get more revenue out of the same headcount. Is that the way you see it?
Speaker 2:
That's not really true. I mean, it's still a global competition, so in practice it should be, but in reality it's not.
Speaker 1:
Okay, okay. And then you know, the market goes through some fluctuations. You were saying the summer was a bit quiet, but it's already picking up again. What are your views and projections for 2024?
Speaker 2:
I see it very difficult for the PCB industry in Europe in general because Europe has a few problems. First of all, the energy prices are much too high. Second, the unions. They demand a four-day working week for the same salary and that makes it all very difficult. You see that our suppliers, the basement to your suppliers, also the machine suppliers. You see a few of them, but many of them come from China. So that's the problem. So, all those things together, I think the PCB industry will have a hard time in Europe for the summer in 2024.
Speaker 1:
Yeah, and when we look at the European industry I don't know how long you've been in the industry You're of an age as well but 20 years ago it was 20% of global production. Now it's between 2 and 3% of global production. Do you worry that there is a critical mass below which it can't?
Speaker 2:
survive healthily. I worry indeed a lot. That's absolutely correct. If you look at this exhibition, 20 years ago there were four halls full with PCB suppliers. Now they have problems even filling one hole and that makes it difficult. So for the future, I see, if Europe is not changing its attitude, if they don't solve the bureaucracy problem, if they don't solve the energy problem, if they don't solve also the, the, the, the, the, the on top of the subsidized system, because in China the subsidy is much higher and also in the US it's much higher. If I was managing director of a company who had to build a new plant, I would go to China or to the US and not to Europe, because they pay too little.
Speaker 1:
Yeah, it makes that those subsidies are really working against you. Plus, you have a greater cost of bureaucracy, you have a greater cost for energy and you you have a lot on your plate. Well, it needs some bold action from from government to stem that and, and hopefully that happens, all the best in the future. And thank you so much for talking to me. Thank you very much.