Q2 2019 Newsletter

 

Burton Q2 2019 Newsletter (1)Our latest newsletter looks at our transition to ISO 13485:2016, a new test database that is helping optimize test strategy and data collection, new additions to our management team, training activities and our team’s participation in support of a worthy cause in our community.

Read the full newsletter here.

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Material Constraints Update: April 2019

While material constraints are likely to occur through the rest of 2019, overall trends are are positive. Lead-times are decreasing in most component types and Burton Industries is seeing less allocation and backorders. Here is what our supply chain team is seeing by commodity:brochurepg1c

  • Analog – (Sensors, Power, Regulators ) Stable to Decreasing – 10-12 weeks.
  • Batteries – Stable – 8-12 weeks.
  • Connectivity (WIFI, Bluetooth, Cellular) Microchip lead-times increase to 18-20 weeks, many manufacturers Stable 12-16 weeks.
  • Discretes (MOSFETS, Varistors, ESD, Didoes, Rectifiers)  Overall decreasing, however some lead-times are still high at 12-26 weeks.  Very positive signs here.
  • Electromechanical – (Power Supplies, Relays) -Stable to Decreasing 10-14 weeks.
  • 8 bit MCU, 32 bit MCU, LCD’s , FBGA– Stable to Decreasing.
  • Interconnect –  Stable with the exception of automotive connectors which are extended 26-40 weeks.
  • LEDs – Stable 8-10 weeks.
  • Memory – Stable 4-12 weeks.
  • Passives
    • Capacitors
      • Electrolytic – Still at 14-18 weeks with some pricing increases (NIC, Nichicon).  Panasonic is seeing Decreasing lead-times at 14-18 weeks with stable pricing.
      • Film Capacitors – Stable- Lead-times 12-16 weeks.
      • Tantalum Capacitors – Decreasing to 11-14 weeks, pricing is stabilizing.
      • Polymer Tantalum Capacitors – Stable 12-16 weeks.
    • Resistors
      • Fixed – Decreasing- Lead-times still high at 16-30 weeks.  Rohm is in allocation and selective pricing adjustments per market are still being made.
      • SMT General (Less than 1UF) Decreasing – Lead-times still range 16-30 weeks.

 

 

China Tariff Update

While negotiations have been slow, resolution on a trade agreement with China that would eliminate the current tariffs seems to DSC05352be continuing to move forward. According to Bloomberg News, line-by-line negotiation on an agreement with China is underway. The 10% tariff on printed circuit boards (PCBs) and components fabricated in China remains in place, but has not escalated. As mentioned previously, even with the 10% tariff, in many cases, China remains the most competitive option for PCBs. We continue to monitor the situation and review alternate sourcing options.

Market Cost Drivers 2019

Overall, there has been a 3.8% increase in base metal costs in 2018 and these increases may continue in 2019, particularly if a positive change in the tariff situation results in increased automotive production. Increases in cost of base metals are most likely to impact capacitor costs. For 2018 cost increases by commodity were:

    • Ceramic Substrate 30% increase
    • Palladium 20% increase
    • Ruthenium 275% increase
    • Tantalite (Tantalum Capacitors) – Steady increases throughout 2018.

The Tariff Situation and PCB Sourcing

DSC05355As we write this, the tariff situation seems to be improving. The 25% jump in tariffs planned for January has been postponed 90 days, pending the result of ongoing negotiations with China. That said, there is a 10% tariff on printed circuit boards (PCBs) fabricated in China. Even with the 10% tariff, in many cases, China remains the most competitive option. Should the tariffs jump to 25%, that would no longer be the case. The team at Burton Industries is in the process of qualifying Taiwanese PCB options to ensure our customers have a range of cost competitive options.

Burton Industries Q4 2018 Newsletter

Our latest newsletter looks at equipment additions, migration to the ISO 9001:2015 quality standard, our 40th anniversary open house and our annual food drive. View Burton Industries Q4 2018 Newsletter here.

Burton Newsletter Q4 2018

Burton Industries Enhances its SMT Capability

Burton Industries Adds Universal Fuzion Line PR_Page_1Burton Industries is continuing to invest production enhancements. The Company recently added a Universal Instruments’ Advantis Fusion SMT line which includes a Fuzion1-30 high-speed placement machine and a Fuzion1-11 flexible platform. The new system supports fast line changeovers, plus has integrated inspection tools which help Burton’s team consistently deliver superior quality. Read more in our recent press release.