Industry: IC packaging and testing plants are urged to increase production capacity in Southeast Asia

According to industry sources, IC packaging and testing plants are being urged to increase capacity in Southeast Asia, especially for BGA packaging. According to Taiwan media Electronic Times, sources said that many international chip suppliers, such as AMD and Intel, are strengthening their supply chains in Taiwan, China, while adopting the so-called “Taiwan + 1” risk control strategy, that is, expanding their presence in China. Sources of manufacturing support outside of Taiwan. In addition to “China Taiwan + 1”, there is also the “China Mainland + 1” strategy that international companies are adopting to diversify risks.

Earlier, ASE stated that some production lines are being built outside mainland China, such as Vietnam, and related work continues. It is estimated that about 25% of ASE Investment Holdings’ system-in-package production capacity will be transferred outside mainland China in the future. Another customer requested to expand production capacity outside of Taiwan, China. ASE continued to expand production capacity in Malaysia, Singapore, South Korea and other places according to customer demand, to meet the flexible demand of customers for traditional packaging production capacity in Taiwan, China and outside Taiwan, China.

International chip suppliers are unlikely to rely solely on facilities in Taiwan and China, the sources said. The U.S. may be reshoring semiconductor supply chains, but for chip suppliers seeking to diversify their risk, Southeast Asia, which already has a large number of semiconductor packaging and testing facilities, is a more practical option. Malaysia and Singapore are both keen to seek investment from chip companies.