Efy report sept10


Published on

Published in: Business
  • Be the first to comment

  • Be the first to like this

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Efy report sept10

  1. 1. EFYREPORTsmT EquipmentDemand Doubling Every YearWith increase in indigenous production of telecom, automotive electronics,consumer electronics and lED products, the demand for smT machines—newand used—is expected to accelerate soon setups for automotive, lighting, LED Uma Bansal and solar products are boosting the demand,” adds Prasad Gurjal, man-D emand for surface-mount aging partner, Drive Technologies. technology (SMT) equip- The demand is increas- ment is rising steadily in In- ing two-fold every year,dia. With the government’s thrust on but it is still below theelectronics hardware manufacturing, expected level. “The SMTthe country is fast becom- equipment market hasing a hub for original started moving forward,equipment manufac- but it has not taken offturers (OEMs) and as expected. The demandelectronic manufacturing services drivers like cellphones,(EMS) companies. Today, many of STBs and other consumerthe global majors in EMS have foot- electronics products areprint in India. The growing manu- still dependant on China.facturing of electronic products, in There seems some revivalturn, is increasing the sales of SMT though in the automotiveequipment. sector,” says N. Chan- In the manufacturing process, dramohan, country headSMT equipment are used for such (SMT division), Juki In-functions as placement, inspection, dia. “The ecosystem is thesoldering, screen printing, glue dis- main cause of the demandpensing and cleaning. These are clas- still not picking up. While there is asified based on the required volume huge demand in consumption, com-of manufacturing: low to medium, Autotronik BS683V pick-and-place machine from ponents and associated industries aremedium to large, and very large. EMS Technologies still lacking.” “The market is improving for usas various OEMs have taken keen the SMT market in the high-volume Demand mostly frominterest in SMT equipment to have the segment. Indian EMS providers also telecom and automotivein-house facility. And soon we will contribute to the growth of the Indian sectorssee big changes,” says M.K. Krishna- market.” As mentioned earlier, telecom (2G andkumar, country manager, Essemtec Especially, “large-scale production 3G telecom networks), automotive,India. “The growth drivers are our ownrequirements in telecom, automotive,lighting and consumer electronics. As Large-scale production setups for automotive,far as the growth of SMT machines is lighting, LED and solar products are boostingconcerned, leading players like Flex-tronics, Solectron Centum, Jabil and the demand—Prasad Gurjal, managing partner, Drive TechnologiesElcoteq have already contributed to6 2 • S e p t e m b e r 2 0 1 0 • e l e c t ro n i c s f o r yo u w w w. e f y m ag . co m
  2. 2. EFYREPORTconsumer electronics (LCD TV setsand mobile phones) and lighting (CFLand LED) are some of the productsfor which SMT machines are widelyused. Also, today, defence electronicsproducts need high-end machines forassembly. Telecom and automotive, themost prominent industries in India,will continue to contribute signifi-cantly to India’s GDP in the comingyears. The mobile revolution andadoption of technologies such asWiMax and VoIP are necessitatingindigenous manufacturing of varioustelecom products such as handsets,base stations, modems and VOIP Complete SMT production lines from ESSEMTEC AG, Switzerlandphones, thus creating the demand forSMT equipment. Technological trends (PCBs) in various application segments Automobiles are using an in- SMT equipment suppliers need to is forcing them to develop and offercreasing percentage of electronic provide the most advanced equip- cost-effective and high-technologycomponents and control units. And ment at competitive prices. They need solutions to their OEM and EMS cus-local manufacturing of automotive to upgrade their products in sync tomers.electronic products is further driving with the evolution of the electronics “SMT equipment vendors needthe demand for SMT equipment to manufacturing processes. Increasing to strike the right balance betweenimprove production efficiency. use of miniature printed circuit boards technology and price in order to gain a competitive edge,” explains Bharath. “The best strategy in pricing lies in being cost-effective while ensuringFaster, more accurate and higher-density provision of value-added services forassembly with a great flexibility is what the customers.” “Faster, more accurate and higher-market demands—N. Chandramohan, country head (SMT density assembly with a great flex-Division), Juki India ibility is what the market demands,”6 4 • S e p t e m b e r 2 0 1 0 • e l e c t ro n i c s f o r yo u w w w. e f y m ag . co m
  3. 3. EFY REPORTinforms Chandramohan. Corporation. “Trend is towards more and Specifically, pick-and-placemore fine pitch and chip capac- machines are in large de-ity. Also, the speed expectations mand today. “Theseof the customers are equipment are importedrising steadily,” says from Switzerland, JapanGurjal. and USA as we do not “SMT machines have indigenous technologyare designed for low today to manufacture them,” saysnoise level, and the Krishnakumar.smoke coming out of the “The same is the case for high-endreflow oven is against the eco- Stecil printers. However, reflow ma-system. But in new machines, this is chines made in India are sold in goodcontrolled using filters,” adds Krishna- quantities,” adds Gurjal.kumar. “In SMT printers, in-line machines RF300 three-zone conveyorised reflow oven from Juki Why do we depend onare being preferred to standalone imports?printers. In pick-and-place, all-purpose strong growth in the SMT placement, “There is no major equipment manu-mounters (multi-function mounters) screen printers, soldering and inspec- facturing happening in India. Theand speeds as usual are the deciding tion equipment product markets. equipment are high-technology, andcriteria. Of course, high-end EMS “Equipment that are in demand except for some peripheral equip-companies look for very high-speed include component placement systems, ment, all the machines continue to bechip shooters. In conveyorised reflow auto insertion machines, printers, imported,” informs Chandramohan.ovens, demand is for seven- to ten- ovens, wave-soldering machines and “We manufacture SMT machineszone depending on the volume of AOI. Barring entry-level ovens and for low to mid volume only, butmanufacturing,” informs L. Sampath, wave-soldering machines, all equip- when it comes to precision and ac-CEO, 3EMST Marketing. ment are imported,” says Suresh Nair, curacy we are dependent on imports. There are ample indicators for director-sales & marketing, Leaptech We, the SMT equipment manufactur- ers, give the patented technology or cross-licence the high-tech manufac-In SMT printers, in-line machines are being turing equipment. As a buyer, we could have good price advantagespreferred to standalone printers—L. Sampath, CEO, clubbed with best services,” says3EMST Marketing Krishnakumar.w w w. e f y m ag . co m e l e c t ro n i c s f o r yo u • S e p t e m b e r 2 0 1 0 • 6 5
  4. 4. EFYREPORT five-zone SMT reflow ovens are indig-The smoke coming out of the reflow oven is enously manufactured in India. The company claims to have the longestagainst the ecosystem. But in new machines, duration of seven years in the Indianthis is controlled using filters—M.K. Krishnakumar, market with more than 300 installedcountry manager, Essemtec India machines. PROSEM Technology India is “SMT equipment are not manu- equipment account for 30 to 40 per the exclusive representative of As-factured locally because the domestic cent of the overall SMT equipment sembleon (formerly Philips EMT)volume does not justify it. Once the sales. Generally, used equipment range of SMT equipment in India. As-volume of equipment for domestic are available for half the cost of new sembleon, still a fully owned Philipsconsumption comes to a reasonable equipment. company, is one of the market lead-level, surely the local manufacturing ers in the SMT placement equipmentwould start. Until then, we need to de- Where to look industry.pend on imports only,” reasons Nair. Juki claims to be one of the top manu- facturers of pick-and-place equipment market forecastssome suggestions in the world with over 23,000 machines A report by Frost & Sullivan, titledChandramohan suggests the govern- installed worldwide. Indian Surface Mount Technologiesment to impose anti-dumping duties Essemtec is a worldwide leader Market, says that the SMT equipmenton finished products like mobile in manufacturing of highly flexible market earned revenues of $54.1 mil-phones, set-top boxes and LCD TVs SMT production equipment. lion in 2008 and estimates this to reachin order to ensure their local manu-facture, which would boost the sale ofSMT equipment. Barring entry-level ovens and wave-soldering “There are various challenges thatsuppliers face today. For instance, machines, all equipment are imported—Sureshcomponents are becoming smaller and Nair, director-sales & marketing, Leaptech Corporationsmaller, making the design compli-cated. The products turn obsolete in a American Tec offers Fuji pick-n- $88.8 million in 2012, growing at ashort time. Low margins on contract place, KIC profiler, Nutek PCB han- CAGR of 13.2 per cent.sales make people go for second-hand dling, Minami paste printer, Getech “Our electronics manufacturing ismachines,” says Krishnakumar. PCB router and VIT AOI equipment. 7-10 per cent of Chinese manufactur- “Quick changes in technology and Leaptech offers such equipment ing and we can expect it to double nexttherefore a fear of return on heavy as chip shooters, multi mounters, glue year,” says Rajendra.investments, and longer lead time of dispensers, hybrid inspection systems, “Availability of cost-effective andcomponents are affecting everything automatic screen printers and solar cell skilled labour is positioning India asincluding machine and product de- printing and drying lines, assembly au- a preferred destination for EMS andlivery,” says Rajendra Singh, general tomation systems and wave-soldering OEM companies,” explains Frost &manager, American Tec. equipment. Sullivan research analyst Bharath SMT machines, which could cost 3EMST caters to different volumes, K. “With an increase in the perks$50,000 to $300,000, are too big an from entry-level to high-end lines. For awarded to foreign direct invest-investment for a company in its initial printing, it has both fully automatic ments (FDI) by the government ofstages while the ROI is uncertain. in-line and off-line equipment. In pick- India, many of the global companiesThat’s the reason why many EMS and-place, its machines range from are anticipated to set up their manu-companies are starting to buy second- 3600 cph to 25,000 cph. facturing facilities in the country,hand (used) SMT equipment. Used Drive Technologies’ three- and thereby augmenting the demand for SMT equipment.” “From a few number of SMT lines sold a few years ago, now the num-Quick changes in technology and therefore a fear of return on bers are in a few dozens. Soon we canheavy investments, and longer lead time of components are expect a few hundreds of setups being sold in India,” adds Gurjal. affecting everything including machine and product delivery—Rajendra Singh, general manager, American Tec. The author is a deputy editor at EFY6 6 • S e p t e m b e r 2 0 1 0 • e l e c t ro n i c s f o r yo u w w w. e f y m ag . co m