Looming EU legislation presents challenge to electronics manufacturers
By Malcolm Wheatley, senior contributing editor -- Manufacturing Business Technology, 12/1/2004 12:00:00 AM
When the European Union passed two pieces of environmental legislation in 2002, few companies outside Europe took much notice. Some now regret this—and they are the lucky ones, to the extent that they've at least heard of the new rulings.
Meanwhile, product life-cycle management (PLM) vendors such as Agile Software are experiencing something of a bonanza, as those partially enlightened manufacturers scramble to get up to speed.
The two pieces of legislation in question are the Restriction on the Use of Certain Hazardous Substances in Electrical and Electronic Equipment Directive (RoHS), having force of law July 1, 2006; and the Waste Electrical and Electronic Equipment Directive (WEEE), taking effect August 13, 2005, which makes manufacturers responsible for the costs of recycling or disposing of scrapped equipment, whether emanating from households or businesses.
Although RoHS's impact is further away, it's the one roiling the PLM market. Simply put, RoHS requires that manufacturers ensure components and devices inside products don't contain prohibited substances.
Hewlett-Packard (HP) believes it is further ahead than most in complying, yet still the company is worried, says Klaus Hieronymi, Frankfurt, Germany-based general manager of HP's environmental business management organization. While HP unilaterally stopped using some materials prohibited in Europe years ago, it continued with others—such as lead-based solder.
While HP tried various alternatives to lead-based solder, says Hieronymi, none of them have its general-purpose applicability. Thus, components production ends up being organized based on the solder used in a given instance—leading to a proliferation of component designations, as the same device is held in multiple instances, depending on which solder is to be used.
"We are a global company, and this legislation is affecting us globally," says Hieronymi. "We don't make products just for Europe. When we make a printer, we don't know if it will end up in Europe, Asia, or North America."
The issue of lead solder is just one example of an RoHS-related issue, and that's before considering WEEE and its requirements for recycled components and waste minimization. HP would like to minimize its costs under WEEE by designing in more recyclable components, but maintains that Europe's 25 countries aren't aiming to implement WEEE in a consistent way, thus thwarting its efforts.
But if HP is concerned, PLM vendors such as Agile most certainly aren't. Thanks to the company's Product Governance and Compliance solution, Agile "is experiencing abnormal market conditions," says Chris Wong, chief product officer. "At a time when IT budgets are under pressure, we're seeing a lot of unplanned and unbudgeted expenditure as companies scramble to comply. We've got customers that haven't bought from us in years suddenly knocking on the door—and it's a two-week sales cycle."
