Made in Germany

Made in Germany
By Arthur Visser, Bishop & Associates Inc.
With contributions from ERNI Electronics, EPT, ODU, and HARTING

Europe’s Largest Connector Market Hosts Hannover Messe 2010
The Hannover Messe took place this year in the midst of the European airspace embargo, due to the eruptions of the Eyjafjallajökull vulcano in Iceland. That led the Deutsche Messe managing board chairman to dub it the “Volcano Event,” but there were plenty of other exciting things to talk about, too. If this show is any indication, the connector industry is about to erupt in the best possible way.

Visitors to the 2009 Hannover Messe, in the middle of the recession, were looking for insight into which direction the industrial markets would move next. But this year, the mood was much more upbeat and visitors were looking to do business. Industry representatives were generally positive about the 2010 outlook, though with some reservations, as the recovery is still considered fragile by many accounts. As a result of the European airspace disruption, total visitor numbers were down by about 20 percent. This was noticeable, especially during the first three days of the exhibition, when some exhibitors were not able to make it to their booth.

As the leading economy in Europe, German business sentiment and German industry performance are key indicators for the rest of Europe.
Germany’s business confidence indicator reached a 21-month record high in April according to the Munich-based Ifo institute. Despite—or perhaps as a result of—financial problems in Greece and elsewhere, the devaluation of the euro raised hopes for export-oriented businesses. The German economy largely is dependent on exports, so not all the news coming from Europe is bad news.

The renewed business confidence is not unfounded, as we have recorded a dramatic increase in bookings and billings for the global connector industry, rising in recent months to unprecedented levels (see The Bishop Report).

Monthly change (year-to-year comparisons) in bookings since January 2008

From Boom to Bust to Boom
The economic recovery has been in progress since the end of 2009, and it’s been accelerating in the first quarter of 2010 at such a pace that the industry is now suffering from shortages of raw materials and components. In some industries, lead times have increased to sometimes unsustainable levels, and OEMs and EMS providers are having difficulties following the demand curve, as their supply chains have come under severe stress. The shortages are quite widespread and affect semiconductors, connectors, and many other components alike. It looks like the industry has been going from boom to bust to boom.

Energy Sector Catches Tailwinds
The theme of this year’s Hannover Messe was “Efficiency – Innovation – Sustainability.” Exhibitors presented their solutions for sustainable energy supplies, and energy efficiency in industrial processes was an important theme throughout the show. Just after the show, Danish wind turbine maker Vestas received the largest order in the company’s history: The Portuguese EDPR ordered wind turbines capable of delivering up to 1,500 megawatts of power for 2011 and 2012 delivery, with an option for another 600 megawatts.

German Connector Manufacturers in the Spotlight
Germany is home to many connector manufacturers, and it’s Europe’s biggest connector market by far, with a share of slightly under 30 percent of the total European connector market. The biggest sector in the German connector market is the automotive market, followed by the industrial equipment market.

German Connector Market by Sector - 2009

The 2009 Top 100 Connector Manufacturers Report by Bishop & Associates featured no fewer than 20 German connector manufacturers, with combined revenues of $2.76 billion (2008 sales). We’ll take a closer look at four of these German companies (click to jump to the section):

ERNI Electronics
ERNl Electronics, with headquarters and manufacturing capacities in Adelberg, Germany, develops and manufactures interconnection products and systems, in addition to respective tooling. The company is a pioneer and one of the world’s leading vendors of connectors in compliance with DIN 41612 (now DIN EN 60603-2), the most widely accepted standard for industrial PCB connectors in the world. Continuous growth lets ERNI centralize its domestic production capacities in a new production plant at the Adelberg site. ERNI met the requirements of the fast-growing telecommunication market in the mid-1990s and initiated new growth with the design of the connector series ERmet and SMC. In the last decade, the company’s portfolio has expanded to include the high-speed families ERmet ZD, ERmet zeroXT, MicroSpeed, and the MiniBridge/MaxiBridge cable connector systems.

The German market for connectors and electromechanical components is highly diversified and driven by a strong industrial automation and control industry. In response to this market situation and the increasing customer request for one-stop shopping, ERNI Electronics has leveraged its core competence in connector design and manufacturing to extend its range of services in the systems engineering area. Today this sector comprises about 30 percent of ERNI’s total revenue. Besides connectors, the company develops and manufactures backplanes, electronic assemblies, and sub-systems, based on cost-effective SMT technology. ERNI's range of services includes all design and manufacturing stages, such as planning, connector design, PCB layouts, circuit diagrams, simulation, prototyping, mechanical design, power supplies, cable assembly and cooling, through to the fully equipped and tested end product.

ept GmbH
Nestled in the heart of Bavaria, about an hour south of Munich, ept GmbH has developed a special manufacturing facility to produce the highest quality interconnects for the automotive, telecom, and industrial markets. ept’s vertically integrated manufacturing capabilities include stamping, plating, molding, and assembly. ept can bring applications from prototyping through to production.

ept’s advanced engineering capabilities include connector and tooling design, machine development for high speed manufacturing processes, and process machine equipment for the reliable insertion of press-fit interconnects.

ept offers its connector products and solutions to two main markets. First, ept designs, tools, and manufactures custom automotive interconnects. Working closely with their customers, ept creates solutions that fit specific application, design, and manufacturing needs. ept also offers a standard line of connector products that meet the architecture specifications for DIN 41612, hm 2.0, cPCI, VME 64, PC/104, PC/104-Plus, ATCA, and MicroTCA.

Second, ept develops creative custom solutions for major telecom and industrial manufacturers.

In addition to three manufacturing plants in Germany, ept’s global footprint includes manufacturing facilities in Svatava (Czech Republic), Chester, VA (U.S.), and Shanghai (China). ept’s extensive quality expertise includes approvals for ISO 9001:2000 and ISO/TS 16949:2002. The quality management system complies with ISO 9001:2000-12.

ept is committed to protect the environment, and meets the stipulations of DIN EN ISO 14001:2004 to not waste natural resources. In addition, ept has introduced an environmental management system.

HARTING
The HARTING Technology Group is a leading electric and electronic connectivity technology innovator. Installation technology, device connectivity, and automation IT comprise the product portfolio of the connectivity and networks business division. The product emphasis is on connectors and system components.

The HARTING Technology Group employs more than 3,000 employees in 32 countries and the company is 100 percent family owned. In co-operation with non-family managers and together with their children Philip and Maresa, the owners Dietmar and Margrit Harting run the company. As a member of the board, Philip Harting controls the connectivity and networks department. Maresa Harting-Hertz is responsible for finance, controlling, and taxes. In 1945, Dietmar Harting’s parents Wilhelm and Marie Harting began to produce everyday articles such as energy-saving lamps, hotplates, and irons, and thus laid the foundation for the HARTING Group and contributed to Germany’s reconstruction. In the 1960s, the company concentrated more on connector production, and set a global standard with the Han®-connector.

As a system provider, the company pursues a strategy of continuous innovation and holds more than 732 patents and 234 brands. HARTING developed application-related solutions—always with regard to adding value for the customer. The name HARTING stands for innovative strength, as proven by the company’s outstanding performance in the Hermes Award for technology during the Hannover Messe. After a nomination in 2005, HARTING won the coveted prize for its RFID technology in 2006. In 2009 the company scored with its Fast Track Switching (FTS). The nominated Fast Track Switches are fully compatible with standard Ethernet and guarantee deterministic data transport in the field, which means they can be used for industrial applications.

At the 2010 Hannover Messe, HARTING premiered a new family of Han-Yellock® industrial connectors. Han-Yellock is flexible, offers safety and reliability, and requires practically no tools for assembly.

The basic ideas behind the Han-Yellock are amazingly simple, and yet effective. The Han-Yellock housing has a split on the cable side. The surface and add-on parts have been designed with an eye to harsh industrial requirements, such as those found in the machine construction industry, energy technology, and plant construction. Operating controls are protected inside the housing, and display a blocking function that offers additional safety in and for industrial applications.

Han-Yellock is a self-contained interface concept that is not plug-compatible with the known Han® A or Han® B sub-assemblies, but it does feature an adapter frame for using the Han-Modular® modules

Han-Yellock is a comprehensive concept that offers more than just the actual components, because it adds solutions for mounting material and housing labeling, and a tool for producing the sheet metal cut-outs.

ODU
Since 1942, ODU has been known worldwide as a manufacturer of high quality connectors. The company’s headquarters are located in Mühldorf, Germany, on the Inn River.

ODU is a single-source supplier for approximately 150 customers around the world. An innovative and flexible partner, ODU handles design and development, tool manufacture, stamping, turning, injection molding, electro plating, assembly automation, and cable assembly, in one location.

The company receives 30 development orders per year from industrial areas including medical technology, measurement and testing, military, industrial automation, telecommunication, and renewable energies.

To meet the needs of customers in different markets, ODU custom-develops new connector lines, like its ODU AMC for military equipment modernization programs and ODU SPC for the renewable energy industry.

Bishop & Associates Comments
It is no surprise that Germany is an economic powerhouse in Europe and the rest of the world. “Made in Germany“ is a label still associated with quality, functionality, and excellence. The general theme of the 2010 Hannover Messe, Efficiency – Innovation – Sustainability, could be speaking of German industry itself. Connector manufacturers from Germany managed not only to keep their market position in the global connector market, but in most cases, strengthened their position by introducing innovative products and solutions that bring value to their customers. The total German connector market is expected to grow in 2010 from $2.7 to $2.8 billion, as the country emerges from the recession and export markets improve. Uncertainty created by troubles elsewhere in Europe may still affect the economic performance of the European Union, but on the other hand, a weaker euro is better for export-oriented economies such as Germany’s.

Arthur Visser
Managing Director—Europe, Bishop & Associates Inc.
Arthur Visser started his career in 1987 at Océ Corporate headquarters in Venlo, the Netherlands, as a product engineer assigned to provide support to the American Océ organization. In 1988, he joined OMRON Corporation at its European headquarters in the Netherlands as the European product manager responsible for industrial automation systems and components. In 1993, Arthur moved to OMRON Electronics in Brussels as a key account sales engineer, and in 1995 became the product and marketing director. In 1998, he joined the connector manufacturer HARTING as managing director for its Belgian subsidiary. Arthur became an independent consultant, based in Brussels, in 2003.

Arthur has a bachelor of science degree in airplane engineering, degrees in marketing and finance, and a master’s degree in e-media enterprising. His native tongue is Dutch, but he also speaks English, French, German, and Russian.