IC Packaging Firms Benefit as Orders Rise for Automotive Chips

automotive chipSource: Adobe Stock

Riding on the trend of vehicles getting more electric and computer-like, the number of installed automotive chips is also increasing, bringing up the demands for IC packaging.

The automotive IC packaging process is favored by packaging companies

Most automotive IC packaging adopts the wire bonding method, which is more cost-effective with a higher gross margin for the packaging firms. As a result, packaging companies tend to allocate more production capacity to make room for automotive IC packaging orders.

In the past, packaging firms tend to lower the price year by year to maintain orders, but now clients have seen actively proposing to increase the price. Given semiconductor fabs increasing production capacity, it is likely to see more outsourcing packaging requests.

Expansion of production capacity for IC packaging

Industry players predict automotive IC wire bonding orders will be fully loaded till end of this year. A subsidiary of Powertech Technology Inc., the packaging company Greatek Electronics Inc. received 700 DRAM WB machines from the parent company directly enlarging manufacturing capacity and subsequently pulling up operational growth.

The wafer-level packaging line of Greatek is predicted to be fully loaded throughout the year and is initiating an expansion to break through the current production bottleneck for the first half of 2021 as well as setting up a second Toufen factory and wafer testing factory by the second quarter of 2022.

 

Source: Money Weekly (in Mandarin)

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