the development of capacitor and its position in...

Electrocomponent Science and Technology1978, Vol. 5, pp. 119-126

(C)Gordon and Breach Science Publishers Ltd., 1978Printed in Great Britain

THE DEVELOPMENT OF THE CAPACITOR INDUSTRYAND ITS POSITION IN WORLD MARKETS

PETER D. DRIVER

Plessey Capacitors, Bathgate, West Lothian, Scotland

(Received September 1, 1977)

This article sets out the existing position in world markets of the capacitor industry and discusses its developmentboth technically and commercially over the next few years. It examines the major component product groupswithin the capacitor industry and iIdicates their relative importance in the total capacitor market and also theirindividual development trends.

The external and internal pressures exerted on the capacitor industry are examined and their relative importancein connection with the development of the industry are disclosed.

1. INTRODUCTION

This article discusses the general market position ofmajor capacitor product groups in world markets andexamines the areas of growth within these productgroups. The various internal and external pressureswhich control the direction of development of thecapacitor industry are highlighted and possible futurecommercial and technical development trends arediscussed.

2. THE CAPACITOR MARKET WORLD WIDE

In the relatively few years since man first made asandwich of electrodes and dielectric material, thecapacitor industry has grown into a multi billiondollar world wide industry and has divided into majorproduct groups for specialist applications. (See Ref.for a technical survey of the various types of capaci-tors.) It is an industry which has had a slow techno-logical development with inventions and develop-ments mainly being variations on a theme revolvingaround changes in construction techniques ratherthan the changing of tke basic materials used.

Aluminium is still the major electrode material andit is only in the last fifteen to twenty years that paperhas been replaced as the major dielectric material byplastic films. The introduction of plastic films as adielectric has probably brought in the greatest

119

advance in capacitor technology in the form of dry,non-impregnated capacitors. This has lead to acomplete revolution of manufacturing techniquesleading to the production of smaller, cheapercapacitors by more fully automatic means.

The growth of the modern capacitor industry wastriggered by the huge leap forward in electronicdevelopments that commenced in Word War II. Withthe return of peace and the development of elec-tronically orientated consumer products plus thedevelopment of entire new fields of electronics, theword demand for capacitors has continued to risedramatically.

Unfortunately for the capacitor manufacturer,the industry is violently affected by the peaksand troughs in world trade which in turn, causes hugevariations in component demand from the consumerindustry.2 (See Figures 1,2). This in turn causes greatdifficulty in predicting the forward requirements ofthe market and leads to component shortages in timesof upswings in the market and large surplus manufac-turing capacity during the downswings.

As a result of this, there is often a reticence toinvest the large amounts of capital required to laydown new capacitor plant. It is therefore in theinterests of both the capacitor manufacturer and hiscustomers to endeavour to control these marketsurges. Some of the steps that are being taken will bediscussed later in this article. Relative data for worldmarkets3 for capacitor product types is shown inFigure 3.

120 P.D. DRIVER

MARKET ($ 106)

2500

2000

1500

i000

5OO

)60965 1970 1975 YEAR 1980

FIGURE 1 World capacitor markets, 1960-1980. (Inflation not allowed for).

GROWTH OF SPECIFIC PRODUCT AREASWITHIN THE CAPACITOR INDUSTRY

3.1 Plastic Film Capacitors

As previously stated, this is one of the largest growthareas within the capacitor industry due to the replace-ment of paper as the major dielectric material.Originally spearheaded by polyester which has con-tinued to be used in large quantities as a dielectric,other materials such as polycarbonate, polystyrenetetraphallate and polypropylene are now used wheredifferent dielectric properties are required. (See Ref.4 for a technical survey of plastics).

3.1.1 A.C. capacitors In the case of polypropylene:a strong boost to its development as a dielectric forA.C. applications was given by the banning in prac-tically every country in the world of polychlorinatedbiphenyl (P.C.B.) as it appears to cause seriousenvironmental pollution.

As this impregnant was used for the majority ofcapacitors manufactured for A.C. motor run applica-tions and for capacitors used in fluorescent lamps, itwas essential that a new type of capacitor wasdeveloped in the shortest time possible to meet therequirements of the environmentalists, the electricalrequirements of the circuit and the physical shapesand size available for the component.

CAPACITOR INDUSTRY 121

CHANGE

6o1965 1970 1975 YEAR 1980

FIGURE 2 Percentage change in world capacitor markets from year to year, 1963-1980.

Satisfactory results have been obtained by a jointdevelopment programme between major capacitormanufacturers leading to the introduction of metal-lised polypropylene non-impregnated capacitors inEurope and the Far East for A.C. voltages up to440 V while in the U.S.A., it appears that althoughdry metallised polypropylene capacitors will be usedfor a majority of applications, a non-pollutantimpregnant may be used where the capacitor has toundergo very strenuous duty cycles.

It is predicted that in the short term, polypropy-lene is likely to replace paper as a dielectric in allexcept the larger power capacitors and in areas ofvery high voltages. With the completion of furtherresearch into high voltages applications, it is alsopredicted that over a period of several years, paperwill be replaced entirely by plastic film as adielectric.

3.1.2 D.C. capacitors Replacement of paperdielectric capacitors by metallised plastic film and

film plus discrete foil components for D.C. applica-tions started over 15 years ago and has now grown tocover the major part of the electronics industry.Although paper and mixed dielectric capacitors stillsurvive, these are mainly of obsolete designs or forspecial low volume applications and will gradually beabsorbed by the new technology or will die as theequipment into which they are designed becomesobsolete.

An exception to this is the metallised papercapacitor which is still widely manufactured particu-larly in Europe by some major companies that havedeveloped this technology. However, even in thisarea, we are seeing companies diversifying intoplastic capacitors although, providing the dielectricremains available, it is expected that metallised papercapacitors will be with us for many years.A great advantage of the change to metallised film

capacitors is the reduction in size made possible bythe new design and the automation of the manufac-turing process.

122 P.D. DRIVER

MARKET ($ 10

IOOO

5OO

1970 1971 1972 1973 1974 1975 1976 1977 1978 1979

YEAR

1980

FIGURE 3 World capacitor markets, 1970-1980, by product types. (Inflation not allowed for).

Plessey and other major European manufacturershave pioneered miniaturised designs in radial metal-lised polyester capacitors that are the equivalentelectrically and are similarly priced to monolithicceramic capacitors. They consist of a radial boxtype construction that has the 5 mm and 7.5 mmlead separation favoured by monolithic ceramiccapacitors. The cases are of comparable size. Thesecapacitors have self-extinguishing properties andbecause they are produced on modern automaticlines (Hessey alone make over two million polyestercapacitors a day in four countries) they tend to bemore reliable than hand made polyester capacitors.These capacitors can be used for de-coupling, timing,etc. up to as much as 5 MHz.

It can therefore be seen that these new polyestercapacitors are of great importance. They haveimpedance characteristics equivalent to the mostpopular monolithic ceramics and are compatible insize with D.I.P. integrated circuits and other modernactive components. It is therefore no longer necessary

to use axial capacitors in order to obtain a low profileon a printed circuit board.

Some electrical properties are also superior toexisting monolithic capacitors. For example, over atemperature range of-0 to +85C the capacitancechanges far less with temperature and the dissipationfactor can also be lower.

Development of plastic dielectrics for specificapplications in the field of professional electronicshas lead to the production of polypropylene, poly-styrene and polycarbonate film capacitors. Capacitorwinding techniques are varied according to the elec-trical characteristics required of the end product.Thus, capacitors can be manufactured as metallisedfilm or film/foil or various combinations of both. Bychanging the dielectric film and the parameters ofassembly of the dielectric and the electrodes, a bettermade range of capacitors can be produced to matchthe requirements of a particular type of electronicsindustry, whether it be in consumer products such asTV, or professional equipment such as computers.

CAPACITOR INDUSTRY 123

Consideration is now being given to the replacingwhere possible, of the more expensive dielectrics suchas polycarbonate with polypropylene or polyester.This has led to the development of polypropylenecapacitors using a metallised dielectric in conjunctionwith a discrete film/foil for applications that require adv/dt of 500 V//as to 750 V/vs.

It is expected that by 1980, film capacitors willrepresent approximately 20% of the total capacitormarket.

3.2 Ceramic Capacitors

As with plastic film, ceramic capacitors are one of themajor growth areas for the capacitor industry.

With the advent of the transistor and associatedsolid state devices and the use of much lower voltagesin electronic equipment, the disc ceramic came intoits own and ceramic capacitors generally have enjoyedan upward growth curve ever since. Considerableinvestment took place in Europe, U.S.A. and Japan toproduce and install automated manufacturing equip-ment and disc ceramics are produced by the majorcompanies at a rate of many millions per week. Pro-viding the electrical parameters of the disc ceramiccan be accepted (i.e. slack capacity tolerance andrestricted maximum voltage) the capacitor lends itselfto modem circuit requirements because of its smallsize and compatibility with auto insertion techniques.

By 1980, the ceramic market in the U.S.A. isexpected to reach $ 200 million which will representabout 25% of the total U.S. capacitor market and willbe the largest market slice except for electrolytics(aluminium and tantalum added together).

3.3 Electrolytic Capacitors

Aluminium electrolytic capacitors have been greatlyaffected by the disappearance of vacuum tubes andtheir replacement by solid state devices. The changein requirements in capacitance and voltage ratingscoupled with demands by both the consumer andprofessional electronics industry for smaller productswith both higher quality and longer life has broughtabout the production of the computer grade com-ponents on one hand and the cheap, automaticallyproduced plug in electrolytics on the other.

Japanese companies have been in the forefront ofthe development of automated production of electro-lyrics to supply the large Japanese radio and TVindustry and this has resulted in Japanese manufac-turers leading the world in aluminium electrolyticmass production technology. In 1976, approximately

six thousand million aluminium electrolytics wereproduced in Japan of which over one thousandmillion were exported.

Over the last two years, the size of the product hasstabilised, with development being concentrated uponincreasing operating temperatures to cope with higherripple ratings and increasing the frequency of opera-tion for use in switching power supplies. Similarly,there has been no radical size reduction in the varioustypes of tantalum capacitors. Instead, we have seenchanges in encapsulation and configuration. Someprofessional solid tantalum capacitors are nowproduced with tubes intended for a welded contactinstead of the normal type that is suitable for reflowsoldering. There has also been an increased demandfor wet tantalum capacitors both in axial and’button’ configuration for use in the avionics industrywhere high capacitance values and very low leakagecurrents are required.

Electrolytic capacitors represent approximately37% of the total capacitor market.

4. FUTURE DEVELOPMENT WITHIN THECAPACITOR INDUSTRY

As with all industrial processes, the capacitor industryis shaped and directed by the pressures placed upon itby its customers, by competition within the industryand by the need to keep individual business profitable.

Of over 500 capacitor manufacturers in the world,the 18 largest contribute over 50% of the total marketvolume. The obviously large variation in size ofcapacitor manufacturing operations is leading to adiversion of manufacturing philosophy within theindustry. If a company has huge volume production,the tendency is to withdraw from products havingsmall production quantities and to concentrate allavailable capital and expertise on a few main lineproducts with very high production volumes. If, onthe other hand, a company has a moderate turnover,the trend is to specialise in small volume production,custom built capacitors such as power capacitors,transmitting capacitors, pulse forming ,networks, etc.Instead of investing large amounts of capital in auto-mated production, this size of company will usuallywork on a jobbing shop basis concentrating theirbusiness on customers requiting specialist componentshaving high quality standards.

4.1 Product Specialisation

In order to survive as a profitable business, it is

124 P.D. DRIVER

becoming increasingly necessary for the major capaci-tor manufacturers to limit their development andinvestment programme to one or two major productlines. There are many factors that contribute to this.

Development projects covering new products arebecoming more and more sophisticated and thereforevery much more expensive. The Capacitor industryhas never been known to return a high profit marginand therefore the cash available for development workis limited. Add to this the need to produce resultswithin months rather than years and the limitednumber of qualified development and researchengineers available who have this specialised know-ledge and it can be easily deduced that priorities indevelopment have to be carefully assigned to majorproduct areas of the business.

When a new product has been satisfactorilydeveloped in the laboratory, a massive capital invest-ment is required before bulk production can com-mence. Due partly to inflation and partly to theincreasing mechanisation and sophistication of manu-facturing plant, the capital investment required fornew capacitor manufacturing plant has rocketed inthe last few years. Plant has to be written off over arelatively short time as manufacturing techniques willhave to be updated more or less on a continuousbasis in order to keep abreast of world demands.

It is therefore necessary for concentration on bulkquantity production on a two or three shift basis withthe aim, if possible, to become the world leader in theproducts in which the company has decided tospecialise, or if this is impossible, to become one ofthe first three or four major world suppliers of theproduct.

With the emphasis on specialisation has come a re-think on the type of manufacturing establishmentrequired to manufacture an automated specialisedproduct. In the old days, capacitor factories had alarge floor area and employed a considerable labourforce to manufacture a large range of labour intensiveproducts. However, the future trend is for a muchsmaller unit manufacturing perhaps only one or twoproduct ranges on equipment having a high degree ofautomation on a two or three shift basis and with thelabour content reduced to a minimum. This type ofoperation permits the management to monitor andimprove the efficiency of the operation.A further pressure being applied to the industry is

the fact that the major customers for capacitors areincreasingly the multi-nationals who, because of theirlarge volume requirements and multiple manufac-turing facilities, require multiple source componentsthroughout the world.

This has had two effects on the industry. Firstly, ithas caused the major capacitor manufacturers in eachproduct area to get together to produce rationalisedproduct ranges so that from the customer’s point ofview, their components are interchangeable with theircompetitors. If major manufacturers’ catalogues areexamined such as Plessey, Roederstein, Siemens, Rifa,etc., it will be found that in many instances, com-patible products have been designed to give thecustomer multiple sourcing. Secondly, manufacturershave developed multiple sourcing within their ownorganisations (e.g. Plessey Capacitors are developingmultiple sourcing by establishing operations inScotland, England, Italy, U.S.A., Germany, SouthAmerica, Australia and the Far East so that anidentical product can be offered from all these areas).

4.2 Automation

In order to retain a world lead position with a particu-lar product, major capacitor manufacturers must keepup a continual investment programme to update theirmanufacturing plant and increase the degree of auto-mation used. This process automatically excludes allproducts for which there is not a very large demand.

Automation is therefore dividing the majorcapacitor product areas into two parts. Firstly thereare the components used principally in the consumerand telecommunications fields where a good standardquality, economic price and large component volumeare required. Here we are looking at automatic pro-duction lines producing anything from 40 million to100 million pieces per year per production line.

The significant features here are that, not onlymust the equipment be capable of dealing with thelarge volume orders received from automotive equip-ment or television manufacturers orders can be for20 million capacitors at a time but must also beable to deal with a sufficient production volume togive a satisfactory return on capital investment.

Secondly, there are the lower volume componentsrequired in professional electronics where a highquality standard is necessary and the quantities aremuch lower. This means that only partial automationis possible and the labour content per componentrises thus producing much more expensivecomponents.

Normally, a capacitor manufacturing operationproduces both consumer and professional com-ponents and as these two markets have in the pasttended to fluctuate at different times, it permits theproduction unit to obtain an acceptable work loaddespite the movement of the market.

CAPACITOR INDUSTRY

Of course, automation does not come easily. Thereare about eight companies in the world makingautomatic machinery for capacitor manufacture butif the capacitor manufacturer wishes to obtain a leadposition in a particular product area, it is necessaryfor him to develop his own manufacturing equipmenteither by modification of existing machines or thedevelopment of new specialist machines.

As previously explained, even the largest companiescannot afford the money or effort to mechanise allforms of capacitor. The Japanese invested primarilyin small aluminium electrolytics five years ago butEuropean manufacturers are fast catching up withthem.

The Europeans lead the world in the automatedmanufacture of metallised film capacitors and arestill ahead of Japan and the U.S.A. in this field. Thistechnology has been further developed to producenon-impregnated polypropylene capacitors for powerapplications and this automated technology isexpected to maintain its lead in the world market.

With tantalum capacitors, it was the U.S. manu-facturers who made large investments in new plant toscale up the production of solid tantalum dippedcapacitors.

In ceramics the Americans and Japanese mechan-ised the production of disc capacitors and are nowmechanising the production of monolithic capacitorson a scale well ahead of any European effort.

It is therefore not surprising that the world’slargest manufacturers of film capacitors are European,of ceramic capacitors are American and Japanese andof tantalum are American.

4.3 Quality Requirements

Apart from the standard requirements for electricalcharacteristics of capacitance, voltage, etc., pressuresare being exerted upon the capacitor industry toproduce products that are not hazardous to theenvironment. With increasing concern being expressedover environmental pollution, many chemicals thatare widely used in the industry have had to undergoinvestigation. The most notable of these is poly-chlorinated biphenyl which is now banned in most ofthe world. This has, however, caused a fresh look tobe taken at other chlorine compounds used as impreg-nants as well as many of the chemicals used duringencapsulation processes particularly with respect tothose used to create flame retardent properties in thecomponent. As this is coupled with an increasingdemand for higher working temperatures and non-flammable components, considerable investment must

125

be made by the capacitor manufacturer in chemicalresearch.

4.4 Size

"Small is beautiful". This saying applies particularlyto the electronics industry. Since the end ofWorldWar II miniaturisation of components has taken placethat in 1946 would have been considered onlypossible in the realms of science fiction.

The growth of new industries such as the computerindustry, and the in-car entertainment industry, havein particular put pressure on the components industryto produce smaller products while preserving qualityand price levels. These requirements have been met bythe use of new materials and the automation ofproduct lines capable of rapid handling of smallcomponents.

The demand for smaller capacitors has helped toincrease the sales of radial lead film capacitorsespecially when made as a plastic box version ratherthan dipped. These have the following advantageswhen used in printed circuit boards (P.C.B.).

a) No exposed leads in the circuit.

b) Well defined dimensions permit more devicesper unit area of the P.C.B.

c) They are usually cheaper than axial capacitors.d) Values easier to read when the capacitor is

fitted.

e) Shorter leads means less chance of radiatinginterference and permits a higher resonant frequency.

f) Strong mechanical construction.g) Will stand upright without external support

during flow soldering.

In both ceramic and tantalum capacitors, greatstrides in miniaturisation have been achieved with themajor product types being radial, dipped capacitors.

In electrolytics, the greatest size reduction hastaken place in the production of the radial, plug intype of capacitor.

4.5 Automatic Insertion ofComponentsA growing influence on the development of capacitorsis the increasing use of automatic insertion machineryfor all types of components. For many years,machines have been available principally from theU.S.A. and Japan that were capable of inserting pre-selected components onto a printed circuit board atrates up to nine thousand pieces an hour.

126 P.D. DRIVER

Recently, machines have been developed both inthe U.S.A. and Japan that are capable of automaticinsertion of radial components at rates of up to fourthousand pieces an hour. With the continuously risingcost of labour, the major consumers of electroniccomponents are installing more and more auto-insertion machines.

This is leading to more component rationalisationamong capacitor manufacturers as it becomes impera-tive that their components are suitable for bando-liering for auto-insertion techniques.

Although bandoliering of axial components usingtwo carrying bands has been in existence for manyyears, radial component auto-insertion has now beendeveloped using a single cartier band which is particu-larly suitable for many types of component includingceramic, tantalum, polyester and plug in electrolyticcapacitors. It has proved particularly suitable in thecase of dipped capacitors particularly ceramics as theyare suspended from a single band during the manufac-turing process and therefore a bandoliered productcan be produced at no extra cost.

5. CONCLUSIONS

We have, in the course of this article, examined theworld capacitor industry and its development trends.Manufacturing and development philosophies havebeen discussed and the areas of polarisation withinthe industry highlighted. With these changes it isexpected that the industry will continue to experiencehealthy growth for the foreseeable future.

REFERENCES

1. C. A. Harper, Handbook ofComponents for Electronics,Chapter 8, Capacitors, McGraw Hill, N.Y., 1977.

2. Mackintosh Electronic Year Book, Mackintosh Publications,London, 1977.

3. Electronics, 50, pp. 81-104, 1977.4. W. Goldie, Metallic Coating o[Plastics, Vol. 2, Electro-

chemical Publications Ltd., U.K., 1969.

OTHER SOURCES OF INFORMATION

Gnostic Concepts Inc.Electronics Industries Association market data books.Journal of the Electronics Industry.

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