Source
ESB
April 19, 2006
The
end of leaded commercial parts: Part 1
This
is the first of a two-part article that looks at the long-term availability of
leaded commercial components.
When
the European Union first announced the Restriction on Hazardous Substances
(RoHS), the defense, aerospace and medical industries sighed with relief – the
legislation would not touch them. They were exempt. But the exemption has not
given those industries a free pass. For decades, those industries have been buying
commercial off-the-shelf (COTS) components, and leaded versions of those
components are beginning to disappear.
COTS
parts are attractive because of their cost. The high-reliability military-spec
parts are more expensive than commercial parts, so the many buyers in the
military shifted to COTS years ago. “For many years military contractors have
purchased commercial off-the-shelf product to drive down costs,” explains Jim
Smith, SVP of warehouse distribution worldwide for Avnet Electronics Marketing,
the components division of Phoenix-based Avnet Inc. The problem for the exempt
industries is that those COTS parts may not be produced in leaded versions for
long. Component manufacturers have switched over to lead-free parts to comply
with RoHS, and many of these suppliers are not interested in producing two
lines, one that complies with RoHS and one that contains hazardous substances.
Meanwhile,
the military, aerospace and medical OEMS don’t want to adopt lead-free parts,
as they have concerns about the long-term reliability of compliant parts. They
acknowledge that lead-free parts are probably just fine for cell phones and DVD
players, but the military and aerospace OEMs build systems that often have to
endure ten to twenty years performance in difficult environments. They don’t
want to chance tin whiskers under prolonged high-stress conditions.
As
the July 1 RoHS deadline nears, concerns are increasing about the availability
if non-compliant, inexpensive COTS. We’re already hearing reports of discontinued
leaded lines as parts suppliers shut down their non-compliant production.
“Unfortunately, many military component buyers are going to find it
increasingly difficult to source leaded COTS product, and RoHS is driving this
change,” says Smith.
One
of the difficulties for buyers in the exempt industries is that it may become
difficult to tell when a component has flipped over from leaded to
lead-free. “One group of manufacturers
have chosen not to change part numbers to reflect RoHS-compliant product,” says
Smith. “These suppliers have made, and continue to make, running changeovers
from the leaded version to the lead-free, RoHS-compliant version of the part.”
Many of these suppliers simply discontinue producing the leaded version as they
make their changeover.
Smith
notes that other suppliers that have changed their part number to reflect
lead-free version of their parts, but they may discontinue their leaded line.
“It has not been economical to run two lines, a leaded and a lead-free,
RoHS-compliant line, so the manufacturer may have decided to only produce the
compliant version of the part and two obsolete the leaded part.” Smith notes
this strategy has set off a run on some non-compliant parts that have reached
their end-of-life. “Over the past year we have seen an enormous surge of
last-buy opportunities from these companies on products that they were
obsoleting,” says Smith.
Another
strategy some suppliers are taking is to continue running both lines but upping
the price on the non-compliant part that now serves a smaller market. “These
companies are just now beginning to increase prices on the leaded versions of
the parts they offer,” says Smith. “We anticipated this for a long time, but it
is just in the last couple months that we have seen this starting to take
place.”
No
matter what strategy the component supplier takes, it looks like the exempt
industries will have to pay more for their parts if they want to continue using
components that contain the six banned RoHS substances. “The military component
buyer will have to pay more for leaded product,” says Smith. “One component
manufacturer just announced a 30 percent price increase for their leaded
product.”
Smith
believes the recent price boots are just the beginning of a wide-scale cost
increase for leaded parts. He also expects this to force exempt buyers to adopt
lead-free parts. “Price increases of the 30 percent magnitude will drive the
non-military buyer to switch over to the compliant version even if they are not
mandated to do so by the RoHS directive,” says Smith. “At some point the
component manufacturer will not have sufficient demand on the leaded version to
justify continuing the lead-free line.”
Part
two of this article will look at the current balance between compliant and
non-compliant COTS. Surprisingly, many parts suppliers have still not converted
to non-compliant parts.
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