by Chris Mitchell, IPC vice president, global government relations

IPC extends its congratulations to TTM Technologies on securing $30M from the DoD's Manufacturing Capability Expansion and Investment Prioritization (MCEIP) office to equip a new 200,000+ square foot facility in Syracuse, New York. The new facility will dramatically increase domestic production of ultra-high density (uHDI) printed circuit boards (PCBs).

Those who know electronics know how significant this award is to U.S. technology leadership and national security. 

Here’s why.

1) The U.S. lacks robust domestic uHDI capabilities which undercuts the nation’s ability to arm its warfighters with the latest and greatest technologies. This is not a future concern; this is a today problem. Leading defense companies cannot easily use the most cutting-edge chips because they can't source a uHDI PCB domestically to accommodate those chips. The result: defense manufacturers are adding complexity or, more worryingly, “dumbing down” their designs to work with the PCBs that are available domestically. This TTM project is helping to solve that problem, and in so doing, it's bridging the chasm that exists in the U.S. between manufacturing chips and building systems. 

2) Kudos to MCEIP Director Anthony Di Stasio and his team. They and their colleagues across DoD continue to demonstrate they understand the electronics supply chain far better than their civilian peers. While other federal agencies seem to be stuck in a silicon-only mindset, DoD is more wisely focused on making investments that will allow the U.S. to both build the most sophisticated chips AND integrate them into the most sophisticated electronics systems. The MCEIP award to TTM is a great example of silicon-to-systems thinking, and more agencies need to follow DoD's lead.

3) This award comes on the heels of great work by IPC and its subsidiary, the U.S. Partnership for Assured Electronics (USPAE). Working with industry, USPAE helped to define the uHDI challenge facing our defense industrial base. DoD officials internalized the findings of this report, and the TTM award indicates DoD is making investments accordingly.  

Meanwhile, securing funding for PCBs in the Defense Production Act has been IPC’s highest priority in Washington, and our work is bearing fruit!

In February, Congress passed an FY24 omnibus spending bill that largely accepted the more robust House funding levels for DPA account. IPC led the advocacy in support of the DPA account with industry letters and countless Hill meetings. Without the higher funding level, the TTM award might not have been possible. 

Now we’re focused on ensuring that this award is not the last. To that end, our work continues on Capitol Hill. In August, the Senate Appropriations Committee in its FY25 defense spending bill directed DoD to allocate $45 million specifically for PCBs. IPC fought for this funding and is now leading the charge to persuade House appropriators to adopt the Senate language. These are real dollars and serve as a downpayment on renewing U.S. leadership in electronics manufacturing. Funding could drop to $0 without it. You can support these efforts; click this link to send a message to your U.S. representative. It’ll only take a minute, but it will make a difference. 

There is no one silver-bullet solution to rebuilding U.S. electronics manufacturing. Instead, the industry must be active on multiple fronts to pursue strategic wins where and when we can. Each win makes our industry more visible, creating greater opportunities in the long-term for transformational change. 

This is IPC’s approach—engagement on all fronts. I’m thrilled that we are having success, and that this success is being fueled by our collaboration with electronics manufacturers across the country.  

by Matt Kelly, IPC Chief Technology Officer

In the past, “packaging” semiconductors simply meant protecting them from stresses such as heat and vibration. Today, "advanced packaging” means putting more functional chips into unified packages that boost the power and performance of the overall system.  

"Advanced packaging” has been dubbed “the new king” of innovation in electronics -- at the heart of cutting-edge technologies like AI, self-driving vehicles, 5G and 6G, and quantum computing. 

So, what does “advanced packaging” mean in the context of semiconductors and electronics manufacturing? And why is it so important to the future of the world? Those are the questions answered in simple language and imagery in a new 90-second video released by IPC. Check it out here: www.ipc.org/advancedpackaging.

The new video lays out the need to prioritize investments in advanced packaging to drive innovation, national security, and resilience. It features easy-to-understand animations: one illustrating what advanced packaging is, and another showing how it fits into the supply chains of crucial products as varied as military jets and smartphones.  IPC thanks member company Intel – a global leader in advanced packaging – for providing some of the imagery used in the new video. 

IPC has a long record of advocating for the wider electronics supply chain, including advanced packaging, printed circuit boards, and IC substrates, without which semiconductors cannot function. Just last week, IPC's Technology Solutions group released a new white paper on "Advanced Packaging to Board Level Integration — Needs and Challenges."

Please feel free to share this video and help us educate others on the importance of advanced packaging in electronics manufacturing. 

by Chris Mitchell, IPC vice president, global government relations

The latest EU Competitiveness Report, authored by former European Central Bank President Mario Draghi and released this month, is a compelling call to action that should serve as a framework for policy action in Brussels and capitals across Europe. 

However, it perpetuates the regrettable and shortsighted practice of overlooking the wider electronics industrial ecosystem that supports resilience, innovation, and security. 

In much the same way that people go to automotive dealers to buy cars and not just engines, people go to stores to buy smartphones, not semiconductor chips. Placing the most sophisticated chips in the palm of a customer is of no value because those chips do not offer functionality by themselves. The functionality is created when chips are placed with other components on printed circuit boards and embedded in larger systems. The printed circuit boards and the process of assembling electronics is highly sophisticated and growing more complex as semiconductor chips become more advanced. 

It's perplexing, then, that government leaders in Europe and the United States give so little consideration to the broader electronics manufacturing ecosystem. Consider this: the Draghi Report references “semiconductors” and “chips” 115 times. It references “electronics” only 21 times and only in the broadest terms. It makes no mention of “printed circuit boards” or “electronic assembly.” Europe’s strategy regrettably seems to be building more sophisticated chips and sending them elsewhere for assembly into end systems. Again, it’s like building the best engines without the ability to place them in cars.

Implementing a “silicon to systems” approach is a serious, urgent matter. Europe has set ambitious goals for the region’s defense industrial base and the digital and green transitions, for which an innovative and robust electronics manufacturing industry is imperative. Moreover, the European Commission has also set an ambitious goal for regional chip fabrication, aiming to reach 20% of global production by 2030. During this same period, unless an “ecosystem” approach is adopted, Europe is likely to lose its alarmingly anemic market share in printed circuit board fabrication, electronics assembly, and semiconductor advanced packaging.   

Given the extraordinary investments being made in the semiconductor industry, ignoring the health of the overall electronics manufacturing ecosystem is shortsighted and counterproductive. The misalignment reflects a fundamentally flawed understanding of the electronics industry and the real long-term drivers for innovation and industrial resiliency. 

You only need to look abroad to understand the value of industrial ecosystems. The remarkable growth of electronics manufacturing in China can’t be reduced to a single factor, but China’s embrace of manufacturing ecosystems is a tremendous advantage. The country is continuing to develop advanced domestic capabilities in PCB fabrication and electronic assembly, in addition to chips, as a way to grow their market share across multiple strategic sectors of the global economy. 

The U.S. is likewise investing big in just one segment of the electronics industry while giving short shrift to the broader industry that’s responsible for building actual systems with functionality. Just this month, the U.S. Department of Commerce held a major Supply Chain Summit during which semiconductors were highlighted repeatedly but printed circuit boards and assemblies were mentioned in passing by a private sector panelist. U.S. officials have said the focus on semiconductors is a matter of setting priorities. But ignoring the weak foundation upon which they are trying to build future innovation suggests they are overwhelmed by the task and unfamiliar with an industry that is critical to just about every key policy goal. They have donned blinders not because it is strategic, but because the landscape is too broad, too multifaceted, and “too technical.” 

Make no mistake: the public-private investments occurring in the semiconductor industry are vitally necessary. But greater strength in semiconductor manufacturing offers Europe and the United States a brighter future only if the strategy opens up wide avenues to innovation and industrial growth. As it is, Europe and the U.S. are racing into a cul de sac unless they adopt a silicon to systems strategy.    

The electronics industrial ecosystems in Europe and the U.S. are in a weakened state, but there are glimmers of change. In Europe, DG GROW has taken the initiative to work with stakeholders to clarify the challenges facing the industry. The collaboration led to a groundbreaking industry report that reflected the consensus of the electronics supply chain. In the United States, the U.S. Department of Commerce issued a report on the information and communications technology (ICT) supply chain that noted the erosion in domestic manufacturing and made recommendations for greater support of the wider electronics industry. In 2023, President Biden issued a presidential determination that printed circuit boards and semiconductor advanced packaging are crucial to national security. However, funding for defense-related PCBs has been modest, at best.  

Greater awareness and seed funding are only the first steps. The long-term ambitions of Europe and the U.S. to revitalize their semiconductor sectors must be matched by effort to revitalize the electronics manufacturing ecosystem. Only when government leaders prioritize a strong “silicon to systems” strategy will there be an opportunity to turn these impending cul de sacs into a huge plaza with multiple avenues leading to innovation and growth.     

By Richard Cappetto, Senior Director, North American Government Relations

On a news-filled day at the Department of Commerce, IPC CEO John W. Mitchell hosted the agency’s chief export enforcement officer to speak candidly with members. The North American Executive Forum brought together more than two dozen CEOs and other executives from across the electronics manufacturing industry to discuss pressing issues impacting both our industry and national security. The central focus of this installment of the quarterly forum was export controls, a critical topic that is increasingly affecting how businesses operate in the global marketplace. The forum featured a keynote discussion with the Honorable Matthew S. Axelrod, Assistant Secretary for Export Enforcement at the U.S. Department of Commerce, Bureau of Industry and Security (BIS) who highlighted his agency's priorities to enforce export controls and wrangle the diversion of electronics components for prohibited end-users.

Earlier in the day, the BIS made news with two major announcements. First, the agency issued along with the other G7 countries, updated guidance on preventing the diversion of exports to evade sanctions imposed on Russia. Secondly, the agency gave notice of a proposed rulemaking which would prohibit the import of certain software and hardware for use in connected vehicles. 

Given this backdrop of increased trade regulation, Assistant Secretary Axelrod, a 20+ year veteran law enforcement officer, shared his insights and priorities in addressing the complex and evolving set of geopolitical challenges. He gave an overview of the risks presented by foreign adversaries that actively acquire and divert U.S. technologies to bolster military capabilities and to exert geopolitical influence with the intent to harm the United States and its allies. During the discussion, Axelrod shared examples of recent major enforcement actions, as well as examples of red flags that signal high-risk customers that he and his agency have uncovered. In sharing these examples, Axelrod urged the industry to stay informed, vigilant, and strive to comply with the U.S Government’s export controls.

Axelrod assured the participants, that the agency’s strategy is to focus restrictions on the smallest category of critical items possible, that represent national security threats, and to allow the vast majority of business to continue. In sharing his priorities, he described them as being based on two key factors: the significance of the military application of a given technology and the destination of the export. The most sensitive technologies, particularly those with clear military end uses, are under the greatest scrutiny. For example, technology that can be used to develop hypersonic munitions, quantum computing, and artificial intelligence represent a high risk, and there for are prohibited and would be subject to greater enforcement priority. 

Multiple participants asked questions and shared feedback alluding to the reality of challenges facing electronics manufacturers in the sheer scale and complexity of global supply chains. How can companies ensure that their products do not end up in the wrong hands when supply chains span multiple countries and involve countless suppliers and customers? Axelrod shared that the agency is striving for transparency and partnership. He repeatedly stressed that the agency appreciates and is interested in companies doing their best to mitigate diversion. He IPC members to share challenges and best practices, and to engage with the agency both directly and through IPC as a representative for the entire industry. He stressed the preference to work collaboratively on the front-end with businesses, rather than having to investigate and impart penalties through the enforcement process. "We are asking everyone to think about what more they can do," Axelrod said, calling on manufacturers to vet their customers more thoroughly. A key recommendation was to not only ask customers about their immediate intentions but to probe further and understand where those customers plan to sell products down the line. This kind of due diligence is essential, especially when dealing with high-risk customers, which poses the greatest concern in the export enforcement landscape. 

Several helpful resources were shared during the webinar, which are included below. He also urged Members to introduce themselves and become familiar with their local BIS field office.

1. G7 Industry Guidance on Export Controls Related to Russia

2. Trade Integrity Project- Common High Priority List 

3. Sample Certification to Prevent Diversion Form

4. Enforcement leadership | Bureau of Industry and Security (bis.gov)

5. Related News – Notice of Proposed Rulemaking to prohibit import of certain hardware and software in connected vehicles

The discussions at the North American Executive Forum underscored a crucial message for IPC members: The United States Government is prioritizing export controls, with a particular focus on stemming the flow of electronics components to Russian weapons. It is the responsibility of companies to conduct strong due diligence on their customers, to ensure their exports do not end up in the wrong hands. Electronics manufacturers are on the front lines of protecting U.S. technological superiority and, by extension, national security. Axelrod’s comments were clear: this is the "new normal." The rapid pace of technological development is only increasing, and with it, the potential military applications of new technologies. As export controls become an increasingly important part of the electronics manufacturing landscape, IPC remains committed to supporting its members through education, advocacy, and strategic partnerships. 

For more information, please reach out to me at RichardCappetto@ipc.org or 202-661-8096.