According to Technology Forecasters Inc. benchmarking studies comprising electronic-product companies and their suppliers, we anticipate that millions of non-compliant components will be stuck without products needing them. Likewise, hundreds of electronics companies with products not covered by hazardous-substance restrictions will face non-compliant-component shortages, delays, and increased prices. The Restrictions of Hazardous Substances Directive (RoHS) deadline was July 1st, and now the lion’s share of electronic and electrical products headed for the European market for sale should have no more than the maximum allowable percentage of six substances: lead, cadmium, mercury, hexavalent chromium, PBB, and PBDE.

Jim Smith, senior vice president of worldwide warehouse and distribution for major component distributor Avnet, said, “In some cases, sure you’ll see a glut of product. You’ll see people suddenly switch from non compliant to compliant and there will be a glut of that component.”

Toshiba America Executive Vice President Stephen Marlow said, “To quantify the magnitude of this issue [managing dual parts—compliant and non], US semiconductor consumption is approximately US$10 billion per quarter. A 10% miss in inventory planning related to RoHS transition, $1 billion of capital per quarter could be tied up in non-performing assets. Without absolutely clear, brilliant channels of communication, we run the risk of having too much of the wrong product at the wrong place at the wrong time.”

What are companies going to do with the excess inventory? Throwing these components into land fill would be antithetical to the global intention for reducing electronic waste. It’s not only the European Union that thinks that “land-filling” hazardous substances runs counter to human, environmental, and economic sustainability. Individual global companies (Nokia, Motorola, Sony, and more) as well as governments in widespread regions (several Canadian provinces and US states, China, Korea, Australia, and Argentina) soon will restrict these six and additional substances. Besides, since when has throwing away otherwise valuable assets been a good idea business-wise?

Wait – Don’t Pitch those Parts!

Quarterly Forum Member e-Certa offers a menu of options for electronic-product companies to (A) minimize purchases of excess non compliant parts, (B) access the non compliant parts they need and cannot find, and (C) deal with the remaining excesses in an economically and environmentally sound ways.

Posted by Jennifer Read, October 23rd, 2006

Filed to Environment

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