With the news of TTM and Viasystems merger, two of the last big three (Sanmina being the third) circuit board manufacturers joining together is certain to have wide ranging effects on the United States Printed Circuit Board industry. To start, each merger of companies this size are priced to include "synergies" between the two companies. The word synergy is code for closing facilities and cutting people to save money to pay for the acquisition.
This isn't unique within the PCB industry. In fact, it's common practice. TTM commented in their press release that they have identified $25 million in synergies that they will recognize in the first year.

Circuit Board During Manufacturing Process

TTM has 11 (7 domestic) facilities and Viasystems has 17 facilities (6 domestic) which will have to be rationalized following the TTM merger. This is based upon the fact that very few of each of the company's' facilities are anywhere near capacity.
This puts some customers in a tough spot. Do they wait to see if the facility that makes their products is closing or do they develop another source before then? Once the facilities consolidate, will that effect lead times and the customers' ability to expedite deliveries? While public company mergers typically benefit shareholders, it puts additional stress on their customers. Not to mention that they will need to deal with new customer service and sales personnel as the combined company needs to find those synergies.
Once the companies are combined, you will have an entity that generates 25% of their overall revenue from assembly operations. Viasystems had a substantial operation in China that did PCB assembly. Most contract manufacturers in the U.S. don't like to do business with companies that have competitive offerings. This makes another decision in which their customers must evaluate.
Effect on PCB Jobs & Education
In 1999 there were over 1,200 Printed Circuit Board shops in North America. With this merger and the subsequent facility closures, the number now may be just over 200. This presents the employee's and longtime PCB engineers with a significant challenge as there just isn't a lot of PCB jobs left in the U.S. Not only do we lose manufacturing capacity but we lose brain power that is used to research, develop, and test new technologies. The lack of potential jobs also limits the number of young people who want to come into our industry which hurts our long term ability to innovate.
Decline of US PCB Industry Questions Small Shops
The PCB industry has been in decline for years in the United States. This is why the strongest companies in our industry have diversified to offer design services and other products that leverage the same strengths that create success in the circuit board space. In addition, the smaller PCB shops in the U.S. don't have the resources either technically or financially to take on the higher tech work and its puts the customers in quite the conundrum.
Summary
Consolidation in various industries in the U.S. has created challenges and opportunities for both suppliers and customers. The opportunity for suppliers who have been around for over 60 years like Epec is to demonstrate to customers how working with a financially stable, privately held company, with significant engineering, and manufacturing resources is a solid long term supply chain investment for their company.
Traditionally, larger companies viewed domestic suppliers as either too small or unsophisticated to manage their complex needs. As the industry and the options for customers get smaller, the best companies invest in their people and technology to fill that void.
Key Takeaways
- Facility closures are inevitable: TTM expects $25 million in “synergies,” which in practice means consolidating facilities and reducing staff, creating uncertainty for customers tied to specific plants.
- Customer supply risks will increase: Consolidation may lead to longer lead times, fewer expediting options, and disruption as customers must adjust to new sales and service contacts.
- S. PCB jobs continue to shrink: With only ~200 shops left compared to over 1,200 in 1999, the merger accelerates the loss of domestic manufacturing capacity and experienced engineers, weakening future innovation.
- Competitive challenges for contract manufacturers: Viasystems’ strong assembly presence in China means some U.S. contract manufacturers may avoid sourcing from the combined company due to direct competition.
- Opportunity for stable, diversified suppliers: Smaller but financially solid companies with strong engineering resources, like Epec, are positioned to serve customers seeking reliable long-term supply chain partnerships amid industry consolidation.