Another fast-growing market with great potential
The LED light industry is another fast-growing market with great potential. We are excited to begin deliveries in this area within the next year.
The LED light market is basically exploding – at the same time, this industry is subject to an extreme focus on costs. When volumes increase, prices drop, which leads to tightened margins and drained profits. This reality is a business opener for DP Patterning. Our cost-efficient machine solutions for both flexible and rigid circuit boards in applications like LED stripes, LED panels and LED modules are all capable of meeting future price competition.
The LED light market is expanding substantially, driven by cost and shorting lifecycles of products. However, the lifetime of LED components is long but the design and additional functionality in the applications drives the market to frequent changes in electronic design, such as flexible circuit boards. Time to market and production flexibility become critical to success in various market segments.
Demand for shorter lead time and higher flexibility are essential in the procurement strategy. But it is crucial for companies to secure the procurement from disruptive events e.g., hazardous virus infection, political trading conflicts, climate disasters etc.
Historically the price competition has been aggressive and that is why the application vendors search for additional features to motivate higher margins. The cost will continue to be one of the most important factors to consider finding solutions to the upcoming market.
The customer has a manufacturing operation in Europe and is a part of a global cooperation. LED panels, tubes and stripes dominate the offerings from the European sites.
The customer is implementing a vertical integrated strategy in the operation. The electronic assembly has been implemented to improve the logistic control, but the PCB is externally supplied. Present supply from the Chinese supplier is unstable and delivery time is varying over time. Smaller order batches and shorter product lifetime cannot be managed by long term forecasting for procurement of flexible PCB. Lack of local competitive alternatives leaves the company in a vendor dependency which predicts weakening the market position.
DP Patterning solution
DP Patterning offers the customer a strategic change of sourcing of Flexible PCBs. The change implies integration of Flexible PCB manufacturing to the electronic assembly activities for system and application suppliers. The manufacturing shift is about reducing the number of process steps, implementing a mechanical process and recycling the residuals for alternative use. The sourcing shift is clean, compact, and efficient, especially when the DPP process allows integration to the electronic assembly operation (SMT).
The clean and space saving DPP process allows integration into the electronic assembly operation. High speed process automation and rapid tool change secure efficiency even for small batches or prototyping. The one material-in and one product- out operation eases the logistic planning and secures delivery capacity.
The customer values primarily the flexibility to meet the market demand for shorter product lifecycles and secure the sourcing by in-house manufacturing of the PCB components. In addition the cost reduction is positive for the customer even if they could accept a little higher cost to mitigate the flexibility and sourcing issues.