Electronics Industry Urges Congress to Invest in PCB Industrial Base to Shore-up Dangerous Vulnerabilities
By Rich Cappetto, Senior Director, North American Government Relations
As the spring season progressed in Washington, D.C., the petals have fallen from the city’s famed cherry blossoms yet again ending the annual springtime spectacle. Sixteen blocks to the east, Congress is now fully underway in deciding how to allocate precious taxpayer resources in FY 2025. I am left wondering: Will the U.S. commitment to securing its critical technology resources be as short-lived as the cherry blossoms?
As things stand today, President Biden’s proposed FY25 budget would eliminate any further funding to bridge the national industrial shortfall in printed circuit boards (PCBs) and advanced packaging and it’s up to Congress to fix that oversight.
Today, IPC delivered a letter to Congress signed by 49 industry executives urging them to sustain current investments in the electronics industrial base or risk putting the United States even further behind the global competition.
Read the full letter here.
How did we get here? Over the last 18 months, industrial base policy has been in full bloom as the Biden Administration began to implement the CHIPS and Science Act and published the first-ever National Defense Industrial Strategy, including provisions to revive the entire electronics ecosystem. The administration announced a series of awards to various projects under the Defense Production Act and about 85% of the funds under the CHIPS Act manufacturing incentives have been allocated to large semiconductor companies. Commerce Secretary Gina Raimondo is projecting the U.S. will manufacture 20% of the world’s leading-edge chips by 2030, nearly doubling today’s output.
IPC has been supportive of the CHIPS Act from conception through implementation. The United States needs a reliable base for semiconductor manufacturing. At the same time, we’ve been clear and persistent that semiconductor manufacturing alone is insufficient to maintain the technological edge required by the U.S. national defense strategy.
Put simply, electronic systems depend on interconnection. A semiconductor chip by itself provides no utility until it is packaged, mounted on a PCB, and connected to other components. As electronic systems have become smaller and more complex, the interconnections themselves have become an advanced capability. Unfortunately, the advancements in manufacturing needed to build these more powerful designs have taken place largely outside of the United States over the last three decades. As a result, domestic manufacturing of advanced printed circuit boards, IC substrates and assembly of complex integrated systems lags behind the global state of the practice. So, despite historic investment in semiconductor manufacturing and a stated goal of building supply chain resilience, the U.S. military can’t use any of the expanded supply of leading-edge chips, because the United States does not have the capacity to produce the most advanced IC substrates and PCBs at all or at scale. IPC’s Chris Mitchell lays out the unfortunate story in a recent commentary article in National Defense Magazine.
If Congress passes an FY2025 budget without meaningful investments in U.S. PCB manufacturers, the electronics industry will have rallied in support only to see investment in its core capabilities pass it by. In the end, reinstating an additional $86 million in Defense Production Act funding is a fraction of a percent of total annual defense spending but it insures a secure supply of key parts to virtually all electronics in the full $850 billion defense budget. Discontinuing it in the next year would be an unfortunate missed opportunity. We can’t leave the United States in a position where we are designing defense technology we need yet can’t produce.
For all these reasons, IPC continues to call on Congress to follow through on the Presidential determination and address a critical vulnerability in the United States’ most important defense capabilities by appropriating robust funding for Defense Production Act purchases of PCBs and advanced packaging in FY2025.
Learn more at www.ipc.org/ipc-advocacy.
