Strong demand for advanced packaging is driving ASE Group's full capacity expansion. On December 17th, ASE's subsidiary, Siliconware Precision Industries, announced it would acquire New Giant Technology's factory and headquarters building in the Central Taiwan Science Park in Houli, Taichung, for NT$3.02 billion to expand its advanced packaging production.
On December 17th, New Juke also held a press conference announcing important information, estimating a sale profit of approximately NT$780 million, subject to approval by an extraordinary shareholders' meeting scheduled for February 19th of next year. Currently, New Juke and SPIL have signed a letter of intent for the sale, but have not yet formally completed the contract for the Zhongke plant. Given the ongoing shareholder meeting process, the sale profit is expected to be recognized as early as the first half of next year.
Public information indicates that the new Juke Zhongke plant, located in the Qixing Industrial Park in Houli, Taichung, covers 5 hectares. During the public tender process, the plant attracted interest from numerous bidders, including Siliconware Precision Industries (SPIL) and Micron Technology, with SPIL ultimately securing the highest bid. Industry analysts believe the new SPIL Zhongke plant boasts a novel design and comprehensive planning. Scheduled to open in the second half of 2021, the plant, only three years old, is well-suited for high-tech industries like semiconductors and optoelectronics, facilitating rapid equipment deployment and production line construction. The site also includes ample land for a second phase of development, allowing for flexible space planning for mid- to long-term plant expansion.
Earlier, on October 28th, ASE Technology Holding Co., Ltd. publicly announced that Siliconware Precision Industries (SPIL) would spend NT$419 million to acquire land use rights at the Erlin Industrial Park in Changhua, Taiwan, for a period of 42 years. Market sources indicate that SPIL's investment is primarily intended to expand its CoWoS advanced packaging production capacity.
Currently, TSMC faces a significant gap in advanced packaging capacity, which has expanded to OSATs. TSMC is currently meeting market demand with the assistance of OSATs. TSMC has reportedly outsourced the critical front-end CoW process and back-end WoS process to Siliconware Precision Industries (SPIL) and Amkor, subsidiaries of ASE Technology Holding. The market anticipates that as the gap in advanced packaging capacity continues to widen, ASE and Amkor will receive more outflow orders from TSMC, further boosting their performance in 2024.
What is the progress of advanced packaging in various regions?
The world is currently expanding advanced packaging capacity and driving innovation in advanced packaging technology. In mainland China, companies such as Tongfu Microelectronics, Changdian Technology, Huatian Technology, and Yongsi Electronics have made significant progress in advanced packaging technologies such as 2.5D and 3D packaging, fan-out packaging, and wafer-level packaging (WLCSP). They are expected to play an increasingly important role in the global semiconductor advanced packaging market. This year, recent progress has been announced for projects in China, including the Shenghe Jingwei 3D multi-chip integrated packaging project, the Weixin Integrated Circuit Packaging and Testing (Phase II) project, the Qili Semiconductor Advanced Packaging Project (Phase I), the Tongfu Tongda Advanced Packaging and Testing Base project, and the Tongfu Tongke Memory Phase II project.
In recent years, mainland China has also introduced a series of policies to support the development of the semiconductor packaging industry, including the "National Integrated Circuit Industry Development Promotion Outline", the "Industrial Transformation and Upgrading Plan (2011-2015)", and the "Implementation Opinions on Improving Manufacturing Reliability".
In Taiwan, TSMC's advanced packaging layout and technological advancement are particularly prominent. According to recent Taiwanese media reports, TSMC is acquiring 30 hectares of land in the Southern Taiwan Science Park to create its first "Advanced Supply Chain Zone." This zone will reportedly focus on advanced packaging and fully support the future CoWoS/SoIC production capacity at its Chiayi (AP7) and Tainan (AP8) plants. Furthermore, in early October of this year, TSMC and Amkor jointly announced the establishment of an advanced packaging facility in Arizona. Close collaboration between TSMC's front-end wafer fabrication facility in Arizona and Amkor's nearby back-end packaging and testing facility is reportedly expected to shorten overall product production cycles.
South Korea has released several policies to promote the development of advanced packaging technology. The South Korean government recently launched a large-scale R&D project called the "Semiconductor Advanced Packaging Leading Core Technology Development Project," with a planned investment of 300 billion to 500 billion won over the next five to seven years. The project aims to help companies rapidly catch up with international leaders in advanced packaging, such as TSMC.
South Korea also recently released its "Semiconductor Future Technology Phased Implementation Plan (Roadmap) Upgrade Plan," which aims to adapt to new trends in semiconductor technology and strengthen support for areas such as semiconductor device miniaturization, system semiconductors, and advanced packaging. Furthermore, the Ministry of Trade, Industry and Energy announced it will sign a memorandum of understanding with 10 semiconductor-related companies and institutions, including Samsung Electronics and SK Hynix, to invest 274.4 billion won (approximately US$2.3 billion) between 2025 and 2031 in the development of advanced semiconductor packaging technologies.
It's also worth noting that Samsung Electronics has recently expanded its advanced packaging production capacity, including at its Suzhou plant in China and its Cheonan site in South Korea. Furthermore, Samsung is building an Advanced Packaging Lab (APL) in Yokohama, Japan, focused on developing next-generation packaging technologies to support high-value chip applications such as HBM, artificial intelligence, and 5G.
On November 21st, the United States announced it would provide up to $300 million in funding for advanced packaging research projects in Georgia, California, and Arizona. The recipients include Absolics in Georgia, Applied Materials in California, and Arizona State University in Arizona. Each project is expected to receive up to $100 million in funding to advance the development of advanced substrate technologies.
Previously, the United States also released the "Vision of the National Advanced Packaging Manufacturing Program" (NAPMP). The program's top investment priorities include packaging materials and substrates, equipment, tools and processes, power transmission and thermal management of advanced packaging components, optical communications and connectors, chiplet ecosystems, and the collaborative design of multi-chiplet systems and automation tools.
In addition, companies such as Intel, Micron, and Applied Materials are also making significant progress in advancing packaging technology. For example, Intel has been investing heavily in its Foveros 3D packaging technology, while Micron is focusing on integrating DRAM and logic devices into advanced packages for high-performance computing applications.