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Francis Tsoi on the Future: What's in Store for Technology, Automation in China's PCB Industry?
April 1, 2016 | Pete Starkey, I-Connect007Estimated reading time: 6 minutes
I caught up with Francis Tsoi, CEO of World Wide Group whilst at CPCA in Shanghai recently, where we enjoyed a lively discussion on a number of critical topics surrounding China’s PCB industry: namely, what is on the horizon with regard to technology and automation?
Pete Starkey: Francis, thank you for sparing your time. Could I begin by asking you what is your opinion of the state of the economy in China this year?
Francis Tsoi: In China this year it is quite tough because I think you understand since last year, 2015, the GDP growth in China dropped back to 6.5 and everyone is expecting that 2016 will be another very tough year. The economy is slowing, with over-production in our factories. In the China market, people need to consider how to change in order to manage the coming year.
Starkey: Do you believe that the market condition in China relates simply to China or is it characteristic of the whole world market?
Tsoi: I think the whole world market also affects China, because China now is no more a low-priced market and resources are also becoming more expensive: land, food, and labor cost. Manufacturers need to consider how to lower their costs and how to be more competitive compared with South East Asian countries. They need to consider how to make their operations more efficient, more effective and more competitive, in terms of their products and also their service.
Starkey: If we look at the PCB industry, is it suffering from the same downward trend as industry in general, or better, or worse?
Tsoi: In general, I think that China’s PCB shops need to move away from the low-end, single-sided and double-sided PCB market and go to multilayer, higher-end multilayer or FPC , flex-rigid or HDI, or even into the substrate or package market. They need to fine tune their product into a higher-end range instead of competing with the low-end, high-volume market, which is no longer profitable in China.
Starkey: So if the PCB industry in China is to have a future it must move ahead in technology, even though there is already some very high technology in China? And the people who are working in lower technologies will not prosper unless they move upwards in the technology.
Tsoi: Yes, and for China PCB shops to go to high-end, fine, dense products or into substrates and packaging, they need to change their investment; that is very important to their survival.
Starkey: Is the PCB industry in China still making investments, even though the business may be in decline in the short term? Is the industry looking towards the future and preparing for the future?
Tsoi: This year we still have confidence that the PCB industry will make investments, not in low-end equipment, but in high-end equipment—laser drilling, direct imaging, X-ray drilling machines, and also 4-wire flying-probe testers—all because they want to make very high-value-added PCBs instead of low-end products. This kind of change pushes them to make more of an investment, and now in China the stock market is rising, and a lot of PCB shops are making public offerings in order to get the funding to make investments—not for higher volume but for higher-end product.
Starkey: It's good to know that the industry is looking to the future and has sufficient confidence in the longer term to be making capital investment in preparation for it. What is the longer-term trend?
Tsoi: There is a lot of talk about the “Made in China 2025” plan, which is the Chinese version of what is called “Industry 4.0” in Germany. The trend is towards the smart factory and smart production, and there is a lot of interest in automation. For example, we have brought the Mitsubishi robot into the PCB market to help reduce headcount in production and make it more automatic, more efficient and more quality-stable. More people are thinking about the smart factory and also considering how to collect and analyse big data, and how to use this data in their systems to support the concept of smart production.
Starkey: So Francis, this is your vision of the future of the PCB industry in China?
Tsoi: Yes, I think that for the next five to ten years, this is the direction for the smart factory and also the smart machine. How to link all the machines in the factory together and make them more intelligent—that is the trend and the challenge for the coming years.
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