Aug 26, 2003 EBN
(08/18/2003 10:00 AM EST)
Like it or not, environmental regulations taking hold in Europe and Japan are forcing the electronics industry in the United States to accept a lead-free future. That is leading to a sea change for manufacturers who must address a host of technical and supply chain issues associated with the phased transition to lead-free boards and components.
Of the many companies tackling this thorny issue, EMS provider Celestica Inc., Toronto, has assumed a leading role by working internally and with various industry bodies in an effort to ensure as smooth a changeover as possible for its suppliers and customers.
"The lead-free initiative is the Y2K of our industry. The transition to lead-free manufacturing is more significant than the elimination of CFCs. It also rivals the transition from through-hole to SMT [surface-mount technology]," said Sean McDermott, regional supplier quality engineering specialist, lead-free initiative, at Celestica.
"In fact, the initiative is more significant than transitioning from through-hole to SMT, because of the breadth and scope of changes required to support lead-free legislation. Legislation will touch areas that were never considered during the last change," McDermott said.
RoHS and WEEE
That legislation has taken two forms--the Restrictions on Hazardous Substances (RoHS) and the Waste Electrical and Electronic Equipment Directive (WEEE) of 2000--both of which will severely curtail the use of lead in electronics products sold or recycled in European Union countries by 2006. Japan is also taking action by forcing companies to document lead content in their products, which many believe will lead manufacturers there to voluntarily begin phasing out their use of the material.
In the United States, no similar legislation has been proposed, but a large number of trade groups are actively engaged in preparing their members for a lead-free life.
"The key issue now is getting buyers and the supply chain involved in the process," said Robert Pfahl, vice president of operations for the National Electronics Manufacturing Initiative. In additon to NEMI, the AEA, EIA, and High Density Packaging User Group are all striving to educate their constituents.
Planning critical
Celestica has spent several years solving thermal and other technical issues that will arise with the discontinuation of tin-lead solder, but now recognizes that the key to a successful transition will be the collaboration between engineering and procurement.
"The technical requirements were daunting enough that most of the industry's efforts went in that direction," McDermott said. "But now OEMs, suppliers, and EMS partners need to recognize the significance that lead-free legislation will have on the electronics supply chain. Planning is key, otherwise when it is time to convert we can be faced with mountains of product, and no one wants to deal with that."
McDermott, who is a member of the NEMI Lead-Free Component Team, is also one of nine full-time Celestica personnel from around the world who have been assigned to develop the technical and business processes necessary to prepare the EMS provider for full compliance come 2006.
The team includes representation from virtually every area within the company, including component and design engineering, information technology, commodity management, procurement, and planning and inventory management.
Thilo Sack, an advisory engineer for Celestica's Corporate Technology group and a member of the lead-free team, said the company's work on lead-free solutions has included the development of new assembly, inspection, and repair processes to accommodate lead-free parts, as well as an assessment of yields and the development of a reliability database to record how lead-free alternatives will perform over time.
Though Celestica is working with two unnamed customers on lead-free sample products, and one customer is already in full production, much of the work on lead-free has yet to infiltrate day-to-day supply chain processes, McDermott said.
"We need to equip our procurement team with an understanding of the criteria of what constitutes lead-free components," he said. "There needs to be a clear understanding of the scope and impact of lead-free in order to understand the differences between compliant and noncompliant parts. This means more analysis both in procurement and engineering to make sure the correct parts are identified for a particular application, industry, or geography."
Procurement's challenge
Procurement is apt to experience a particular challenge during the point at which the industry is straddling lead and lead-free product portfolios, McDermott said.
"In the short term we're dealing with parts during a time of rapid transition, meaning that [parts change notices] and obsolescence management require more focus than in the past," he said. "The processes are the same, but there may be many more last-time buys occurring, for example, than is usual over a given time period."
Specifically, this means that when purchasing departments are sourcing alternate components, they will have much more to worry about than whether a given part meets performance and dimensional specifications.
"It's not just about form and function anymore," Sack said, "because procurement people have to really understand how this component--this new derivative--may or may not meet the requirements of the customer and/or the legislation.
"This is where customization comes in," he said. "We're not going to be able to just deal with parts that are considered commodities today. These parts are going to require different understanding and handling from procurement people that they didn't have to do before. There is no more off-the-shelf."
As a result, the EMS provider's lead-free team is working with the company's procurement staff to ensure that they know the right questions to ask when sourcing lead-free components.
In addition to the obvious (does this part comply with RoHS/WEEE legislation?), McDermott noted that buyers will have to know if there are additional requirements for the component as a result of it being lead-free, and whether the part's physical parameters have changed.
Further complicating the procedures that procurement and commodity management teams will have to handle is the fact that there are several exemptions to the legislation, such as automotive, medical and military/aerospace, and telecommunications infrastructure applications.
Lead-free education
And though McDermott and Sack are confident that Celestica's supply base will be ready with compliant parts in 2006, the team is not leaving anything to chance.
"Our procurement team is working with our suppliers to educate them on Celestica's views on lead-free and our requirements well in advance of the 2006 deadline," McDermott said.
Once again, education is Celestica's preferred course of action.
"Information-sharing is extremely important. The supply base needs as much detailed information on requirements as we can provide. This includes legal requirements, market trends, customer expectations, and our own technical requirements," he said.
"We can't afford to keep suppliers in the dark about our needs, or we will not have a broad enough supply base ready to source parts for fully lead-free products."
McDermott acknowledged that the transition will likely be more difficult for some of the industry's smaller vendors that may not have the financial resources to put into the development of lead-free materials, but he added that Celestica is prepared to work closely with these niche players to help them meet the requirements.
Already, Celestica has addressed requests from smaller suppliers that are resistant to the idea of creating an entirely new series of part numbers for their lead-free products, which would make it easier for customers like Celestica to separate leaded from lead-free components. Instead, vendors are pitching a scheme under which they would simply modify existing SKUs.
"This simplifies implementation for the supply base, as supplier product catalogues don't have to expand significantly--which also saves money," Sack said. "However, this creates a logistical challenge for EMS and OEMs, as traceability of components is a critical part of the WEEE legislation."
Ultimately, Sack said he expects new part numbers will make the transition to lead-free simpler for the industry as a whole.
What does it mean?
Another issue making the transition to lead-free more challenging is the fact that the definition of lead-free today is variable.
"Up to 2006, anyone can get away with anything and call it lead-free as long as there is some element of lead-free in the bill of materials," Sack said.
"If you look at what some of the component suppliers are doing today, you will still find in many cases that there are lead-free parts but the boards may still be assembled with tin-lead solder. Or they have replaced the tin-lead solder with lead-free but are using parts that still contain lead. The supply chain is not ready to supply 100% lead-free-compatible components. They are moving toward full compliance but aren't there yet."
Additionally, Sack said there is a need for industrywide agreement on exactly which compounds--in addition to lead--must be tracked at the component level. (The RoHS legislation also regulates and restricts the use of mercury, cadmium, hexavalent chromium, polybrominated biphenyls, and poly- brominated diphenyl ethers.)
"What we're seeing right now is that, because this is not clearly specified, we are getting diverse requests in terms of the number of compounds we're being asked to report on for the chemical makeup of the components," Sack said. "We even had one customer who asked us for every element on the periodic table and every permutation thereof, which to me is overkill vs. what my interpretation of the legislation requires."
Push for a standard
The push for a "materials declaration" standard is also NEMI's top concern at this moment, according to Pfahl, who noted that a standard may soon be available.
"There are three major groups in the U.S., Japan, and Europe that have just about agreed on what information should be exchanged, and are working to make it a standard," he said.
Though it is not yet clear which standards body will be offering the standard, Pfahl said that NEMI will be working closely with whatever group does take the initiative and will help evaluate the suggested methods.
But that raises another concern: no single standards body or industry group has yet to take the lead in creating a standard for defining lead-free products and documenting compliance. Because of the lack of a unifying voice, Sack and McDermott believe it is important that the industry as a whole moves forward together.
"So many of the details are not yet defined," McDermott said. "If we don't work toward common solutions, meeting the deadlines may prove to be impossible."
