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productronica 2025 12 Die offizielle Messezeitung www markttechnik de Printed Circuit Boards The Printed Circuit Board Crisis “Atragedy for Europe — but nobody seems to notice ” The European printed circuit board industry is in danger of disappearing which would bring with it disastrous consequences for safety critical sectors The sudden surge in demand from the defence sector should be utilised to reverse this trend explains industry analyst Dieter G Weiss in an interview with Markt Technik Markt Technik How do you assess the current situation in the European printed circuit board industry? Dieter G Weiss Data4PCB Last year revenues in the European printed circuit board industry fell by 4 2 % compared with 2023 In Germany they decreased by 7 7 % in the first eight months of 2024 the first eight months of 2025 show a slight increase of 1 % In contrast the global PCB market is expected to grow by 6 % this year This shows that Europe’s global market share is continuing to decline — which is not a good outlook for Europe How large is Europe’s share of the global PCB market? In 2024 it was 2 2 % Excluding Russia and Belarus it comes to 1 95 % This year Iexpect a global share of 1 85 % On top of that only 20 % of all PCB manufacturers in Europe — a total of 174 — generate 80 % of the revenue There are a lot of small companies generating less than 2 million € per year Many of them will die The PCB industry as a whole continues its downhill trend When global supply chains collapsed due to the corona pandemic weren’t small European suppliers suddenly in demand again? Yes suddenly users were queuing up the order situation was good and even the smaller companies grew There was hope that large buyers would in future at least partially source from Europe so as not to be too dependent on the Far East However when the worldwide supply chain situation improved from 2021 this hope was gone and results worsened again from 2022 on Yet supply chains can be seriously disrupted at any time and unfortunately there are more than enough threats in the world right now That advanced packaging is of strategic importance and that without some sovereignty over manufacturing the critical industries including defence could be completely cut off from supplies has finally been recognised at the EU and national level PCBs have a similarly high importance as advanced packaging — and yet nothing appears to be happening The EU primarily supports front end IC manufacturing in order to catch up internationally But measured by that the situation for PCBs and also the EMS industry is much worse It is nice that the importance of advanced packaging is now apparently recognised But with PCBs the situation is very similar and the boundaries between advanced packaging and PCB manufacturing are fluid — industry experts know that But the message has not yet been understood at the political level Meanwhile PCBs form a crucial element in the ecosystem within which the newest chip generations are manufactured These chips are indispensable for industry automotive aerospace and defence If the required high quality PCBs are not manufactured locally users could be completely cut off from their suppliers meaning that critical systems may no longer function That is apparently not at all understood by politicians in Brussels and in Germany — on the contrary some are even trying to throw a spanner in the works Can you give an example? In order to manufacture PCBs producers depend on the appropriate raw materials essentially FR4 and copper Whereas 45 years ago Europe still had 22 manufacturers of base materials today only three remain of which one Panasonic will close its plant in Austria at the end of the year That leaves only Isola and Aismalibar It must be noted that Aismalibar is primarily focused on laminates for applications outside electronics Iestimate the company’s revenue with FR4 at 10 % So in effect there is only one European supplier of base materials focused on what is needed for PCB manufacturing Isola So - where is the catch? Here it comes A PCB manufacturer that has to source base materials and copper foils from Asia because there are hardly any other sources must pay about 6 5 % import duty depending on type which makes PCB manufacturing in Europe more expensive than in Asia By contrast users who buy their PCBs in Asia do not have to pay this surcharge because no duty is levied on the import of PCBs So the PCB industry here is being treated worse by the authorities than the competition from Asia That is absurd Considering the geopolitical situation it looks as if defence is coming to the fore and that’s where demand is huge Will this development not lead to the PCB industry now also coming under the spotlight? This development indeed helps the PCB industry and ensures that demand is revived Defence would be a very logical market to help make the PCB industry in Europe future proof Under the current conditions does the PCB industry have sufficient capacity available to meet the rising demand? Iam convinced that there is sufficient capacity Because the industry is currently only operating at half strength many PCB manufacturers today operate on just single shift the larger ones in two shifts So capacities could very easily be ramped up very quickly The demand for PCBs in defence applications is increasing Is that why TLT Teltonika has just opened a new PCB factory with an area of 33 000 m² in Vilnius — the largest built in Europe in two decades? TLT Teltonika has just opened in Vilnius the “High Tech Hill” which in addition to the new PCB facility includes a new plastic injection moulding and mechanical engineering plant a new EMS factory and a new assembly packaging and test plant With this vertically integrated approach the company is targeting users in the defence medical technology and automotive sectors who are looking to benefit from high IP protection supply chain security and higher quality — and who are willing to pay a somewhat higher price Could PCBs actually be manipulated so that certain devices in a serious crisis could simply be “switched off” by an interested party? That would indeed be possible PCBs are very easy to manipulate This was substantiated by the “Panda” study from the Bundesamt für Sicherheit in der Informationstechnik Federal Office for Information Security this year Then for example a drone defence system could suddenly no longer work when it is needed Do companies in the defence industry therefore not already buy their PCBs from European sources anyway? Some defence companies and also some in other industries do already buy in Europe for security reasons But by far not all Are there enough European PCB manufacturers to meet the demand of the defence industry? From a manufacturing technological standpoint that should be no problem In Germany and Austria there are enough companies that could do that without difficulty The same is true for other European countries such as France Belgium UK and some Eastern European states especially now Lithuania Is the rising demand from the defence sector sufficient to help get the European PCB industry out of its crisis? Or is additional political pressure required? It would help a lot if a law were passed obliging the European defence industry to buy only from trusted western sources PCBs used in safety critical applications must not come from the Far East That would contribute substantially to our security and give the PCB industry a boost and it would cost the taxpayer nothing That could put the PCB industry back on a growth path European PCB manufacturers could then calculate cost covering prices and again invest in the future That wouldn’t necessarily please the OEMs… … but it’s a simple calculation The PCB today accounts for only about 4 % of the cost of an assembly If that cost were 25 % higher that’s only a 1 % higher cost for the total assembly In electronic modules and we’re talking about additional costs of well under 1 % that should be worth paying for our security With the “cheap is sexy ” strategy nothing will happen and that’s why our politicians need to get involved But this would have to come from the EU as a whole and Iam rather sceptical whether that could be agreed The situation remains difficult in fact it is a tragedy that we are witnessing this –on the 50th birthday of productronica The Interview was conducted by Heinz Arnold Dieter G Weiss in4ma “It would help a lot if a law were passed obliging the European defence industry to buy their PCBs only from trusted westernproducers That could stop the downward trend ”