ATG’s Swen Fleischer on China: the Market, the Future and CPCA
At CPCA 2015 I had the chance to st down with ATG Luther & Maelzer’s Swen Fleischer. Among several topics, we discussed automation in China, the Chinese market in general and areas of future growth, as well as the effect of three major trade shows a year on the turnout at CPCA.
Barry Matties: Swen, you’ve been in this industry for quite a while, and I know that when it comes to ATGLM, it's all about testers. What is the greatest surprise in testing that you’ve seen in your career?
Swen Fleischer: I’ve worked nearly 25 years for ATGLM, and yes, I’ve spent my whole professional life in testers. So when I consider ATGLM, the most surprising thing would be that we’ve been able to develop new generation after new generation of our testers. When we started the flying probe—around 1990, we only considered prototype testing. But you can see that roughly every six years ATG was able to make a new generation; we are currently at the fourth generation now. We are able to test batches of 500, 1000, and 2000 boards by using our flying probes.
The next point is that the density of the product continues to increase. We now have requests from the packaging market to test 10-15 micron pads. At 10-15 microns there is nobody in the world able to test on a fixture. So flying probes is the future and the only possibility. ATG has shown outstanding performance using multiple probes, like 8, 12, 16 probes. This year we even built a 20-probe tester. This means we really have the capability to develop the future technology of high-speed flying probes so that no other company in the world is able to compare. This is an outstanding feature of ATGLM.
Matties: And that is a perfect fit for the Chinese market.
Fleischer: Yes, because China is a mass production market. They are not buying one or two flying probes anymore, but instead are buying maybe 8 to 15 now. The market changed the course. They are tired of building fixtures and spending a lot of money on a one-time fixture. With more and more prototypes, they may test 500–2000 boards every day. We are not talking about 100,000–300,000 boards; this is not the type of business for probers. But it’s pretty serious for prototyping or small series, especially when dealing with HDI mobile phones, where nearly every day they are testing lots of 500–2000 boards.
Matties: Is this is an automated process?
Fleischer: I would not say it's automated; the testing is mainly done in manual mode today. But we see also more and more automation coming to flying probes. The biggest advantage in China is really to have no manual touch between when they load the board to when they take it out of the automation. With automation, no manual mix-up of good and bad boards can happen at the loading/unloading step.
We also get more and more demands to test HDI boards with Kelvin. On a universal tester, Kelvin needs double the number of probes and it is very expensive and difficult to build a fixture. If you are lucky you will achieve some hundred milliohms and even then the fixture must be perfect, the cassette must be perfect, and the contact resistance must be very stable. On a flying probe tester, Kelvin tests are much easier; just change all the test probes from 2 wire to 4 wire Kelvin needles, and you are ready for Kelvin testing in the MOhm range. The Kelvin test is very reliable for verifying microvia connections in the PCB.
Matties: I’ve seen a lot of flying probes on the market in China.
Fleischer: You are right. We have a lot of competitors with low-cost probers in China, especially the vertical orientated probers with four arms, two on each side, which many companies produce. I’ve seen 20 companies with this. But this is a different class. They can not touch smaller items like 75 Mircon and they are very slow compared to us. Sometimes they need three, four, or five machines to compete against one of ours.
Matties: What are your thoughts on the Chinese market?
Fleischer: The Chinese market is still the major dominant market for PCBs in the world. I can say for ATGLM in China and Taiwan, which together are my responsibility, we have at minimum 50% of our revenue here, so it's a major market. We see this continuing in the future, and even now the packaging industry, which was the domain of the Japanese and the Koreans, is now moving forward to China and Taiwan. My guess is that in the future there will be a larger portion of the market in China.
Matties: So you see growth for your company. One of the things that I've noticed is that 10–12 years ago this show was loaded with multi-national companies, and now, not so much. There is only a handful, really.
Fleischer: I don't know if it has something to do with the CPCA show. I think the point is that everyone everywhere deals with show budgets, and in China there are three shows in a year. There can’t be that much new equipment for every show, right? Especially since the Suzhou show and the CPCA are so close together—just two months apart.
I mean, countries normally have one show but China has three. This may be the reason why some suppliers make the decision to not participate at all exhibitions in China.
Matties: I see that there are increasingly more Chinese suppliers that have increased their abilities, their technologies, and maybe they've displaced some of the market as well?
Fleischer: Yes, but on the other hand, maybe for a lot of applications a Chinese product is good enough. Honestly, last year we were a little disappointed in the number of visitors at our booth. For the future, I will use the two or three days here to get a new impression; based on this we will decide which show we will participate in, in the future.
Matties: So it may not really be a reflection of the market, but just a reflection of too many shows.
Fleischer: In our case, yes. I don't know how it is for other companies.
Matties: If I was an owner of a circuit board shop in China, what should I be thinking of in terms of my test strategy?
Fleischer: In China, there are roughly 2,000 PCB shops, so everybody has a different strategy. First we have to look at your product mix. What do you want to test, what are your test requirements, which end customers do you deliver to? What do you need for data preparation, how quickly do you need to test? These things need to be analyzed first, before we recommend which equipment is perfect for you.
Matties: I hear that in America there is on-shoring occurring, with people coming back to get products built. What do you see as the impact of that on the Chinese market?
Fleischer: First of all, America is a prototype market, right? China is surely not that dedicated to prototypes. They are looking for big orders. The problem is that in China you don't get much attention for smaller lot numbers. So I don't think it's a big impact on the Chinese economy.
Matties: And which market segment do you think is the fastest growing right now in China?
Fleischer: Server boards and mobile phones are growing most because of the Internet and communication requirements. A lot of companies are investing in this segment. Apple did very well, but the low-cost Chinese mobile phones are getting a bigger and bigger portion. It's still a growing market, if you see that only 10% of the Chinese population having a mobile phone you look at an enormous internal potential in China.
Matties: Let’s talk about India. Do you have any attention there?
Fleischer: I have personally gone to shows in India five times, so I know the India market, and I would hope they grow out. Unfortunately, up to now we haven’t seen it. I think they have a lot of infrastructure problems in India that have to be solved first before the industry really moves there. We sell maybe two or three machines a year to India; it’s a limited market for us.
Matties: Do you see printed electronics growing fast in China?
Fleischer: This is also a nice question. I had some contact with a company, five or six years ago, they were mainly concentrated on organic electronic testing. The problem with this market was, every five years it’s announcing that it's coming. But I'm still waiting.
Matties: Well, good. Thank you, Swen. I enjoyed this conversation on a variety of topics.
Fleischer: Thank you. I did as well.