Frost: Lead-free Manufacturing Revives Stagnant SMT Equipment Market

July 25, 2006

The approaching 2006 deadline for the removal of lead from the electronic manufacturing process has helped bring about the revival of the mature surface mount technology (SMT) equipment market, according to Frost & Sullivan. As "green" manufacturing gains currency, notably in regions such as Eastern Europe and China, this market is likely to experience renewed growth in the future.

New analysis from Frost & Sullivan of the world SMT cleaning equipment market found revenues of $34.3M in 2005, with estimates to reach $55.0M in 2012.

"Lead-free manufacturing has caused process changes in the SMT line that have placed more emphasis on cleaning," said Frost & Sullivan industry manager Keith Robinson. "With more residue left on the assembly during lead-free manufacturing, industries that did not historically clean are likely to do so between 2006 and 2010, thus creating new market opportunities."

The nature of lead-free manufacturing requires higher preheating and heating temperatures, causing changes in the flux that make it more difficult to clean, said analysts. It also calls for an increased amount of flux, which leads to more residues on the assembly. Defects can occur in products if the assembly is not thoroughly cleaned, thus creating increased demand for SMT cleaning equipment.

Analysts said lead-free assemblies are more difficult to clean than those using lead, causing concerns among electronic assemblers about the feasibility of becoming truly lead-free compliant in 2006. Moreover, cleaning lead-free materials is highly demanding and places increased stress on the entire cleaning process - from the machine to the chemicals involved.

This has led to many assemblers expressing doubts about the efficacy of SMT cleaning equipment in cleaning lead-free assemblies, creating a major challenge for equipment vendors. "To overcome this challenge, some companies have been very proactive in educating customers on how to clean lead-free assemblies effectively," said Robinson. "SMT vendors will need to be very aggressive in addressing customers' needs in 2006, because this is a critical year for the SMT cleaning equipment market."

Apart from electronics manufacturing, the medical device, aerospace and defense industries are likely to increase their demand for SMT cleaning equipment. Analysts said these industries are anticipated to be the primary markets for SMT cleaning equipment in North America and Western Europe. In China, the expanding space program is also likely to provide new opportunities to equipment vendors during the forecast period.

Source: Frost & Sullivan.