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Warning: Lead may be hazardous to your bottom line

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Manufacturers are discovering that complying with the rules and converting to lead-free parts costs millions of dollars. Not everyone is capable of bearing that cost and as a result, not everyone is converting. That, in turn, is raising the confusion level across the industry about what parts will be acceptable and what parts won’t be.

“We’re seeing more and more discontinuation notices on old products,” says Jan Pape, worldwide marketing director for Texas Instruments ’ standard linear and logic products group. “It just costs too much to convert.”

TI’s logic group should know. The company began its conversion a decade ago with parts that are now largely commoditised. Trying to make that conversion now, with margins as thin as they are in a commodity business, would be next to impossible, said Pape. Distributor TTI is watching that phenomenon unfold on a grand scale across numerous vendors’ product lines. “I find it amazing how many companies are not aware it’s even an issue,” says Craig Conrad, senior VP at TTI. “As time goes on, this will be a mess. The biggest concern is when you do business with companies that don’t sell to Europe or Asia. They’re completely naïve to the impact on other suppliers. The entire supply chain is changing.”

Like TI’s Pape, Conrad expects numerous companies to fold up shop. And in areas where there is little competition, that could cause a significant void in the electronics supply chain. “There are interesting implications when products are no longer viable for technical reasons or cost reasons. We’re seeing smaller companies revisiting their outsourcing plans.”

Perhaps the worst problem occurs on a systems level. A board that uses components from numerous suppliers has to ensure that the parts they use will be in compliance with the RoHS regulations when they take effect on 1 July 2006. In many cases, that means products designed within the past several months have to use acceptable parts or an entire system can be banned from sale in a market.

Even the best-intentioned plans can go awry. A significant number of component suppliers have refused to change their part numbers. When parts are returned, it’s sometimes impossible to tell which ones contain the banned substances such as lead, cadmium, mercury and biphenyl ethers. In fact, the only way to make sure is to research batch numbers and dates that those parts were manufactured, which is a Herculean task for companies that offer thousands of components.

“To be certified at the ‘green’ level, you have to look at the body of parts in a component,” says Jim Smith, senior VP of warehouse and distribution worldwide at Avnet Logistics. “You have to worry about the inks on a label or a box of tape.”

Lead is your friend?

Not everyone wants lead-free parts, however. The US military, in particular, wants parts that it knows will be reliable and which have been extensively tested. In the past, this wasn’t a problem because the military typically obtained parts through custom development and small-batch production.

In recent years, however, the military has shifted to off-the-shelf parts in an effort to reduce costs. Many of its designs, in fact, require parts that contain lead. Those parts can be soldered to a board at about 235 degrees Fahrenheit (1130C) without fail. Tin solder without the lead has a melting point of 265 degrees (1290C). Using the wrong temperature on a part can produce what are known as “tin whiskers”, which literally grow over time from the solder and can short-circuit a PCB (see Electronics News April 2005 page 13).

Tin whiskers have been particularly difficult to document, however. While the phenomenon is well-known to scientists and engineers, a short-circuit disables the unit and burns the whiskers. Without putting the unit under a microscope before the short circuit occurs, it’s almost impossible to find.

“There’s a growing availability issue for leaded products,” says TTI’s Conrad. “If it is available, there’s a huge premium attached to it. The volume will go lead-free. Those bound to a leaded design are now searching for parts.”

Who called the police?

While the RoHS rules stem from the European Union, China is working on its own set of rules that will be at least as stringent as Europe’s, and states such as California are considering enacting their own.

Enforcement of the rules by government bodies remains sketchy, but no one seems to be particularly concerned about that. One of the interesting things about RoHS is that the real enforcement doesn’t have to involve a government agency. Most of that will be done by companies looking to trumpet their own lead-free products. Most distributors believe there will be a flurry of activity dismantling rivals’ products and searching for hazardous substances. If they find them, they’ll quickly notify inspectors who can stop entire shipments of the goods.

This is good news for distributors that can scrub bills of material for companies looking to build systems. The fear of getting caught has created a significant market for companies such as Avnet , Arrow and TTI that have the logistics in place to be able to track batch numbers and alternative parts.

But as many experts in the field are warning, compliance in this case may be done in reverse at first. Many problems will show up after products are introduced to the market, and that should start a slew of lawsuits that will take years to resolve.

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