ASE budgets NT$70 billion for five-year expansion

Taipei, Dec. 25, 2003 (CENS)--Advanced Semiconductor Engineering (ASE) Inc. recently finalized a project to spend NT$70 billion (US$2 billion at US$1:NT$34) over the next five years on expansions to distance itself from rivals in world chip-assembly competition.

The Taiwanese chip assembler will expand its packaging substrate, fine-pitch all gird array (FPGA) and flip-chip packaging capacities as well as increase R&D staff of substrate technologies to over 100.

The chip assembler said it hopes to help the domestic chip-making equipment industry develop self-sufficient equipment through its multibillion expansion plan every year so that it can reduce production costs with domestically developed tools. Its hope has received positive response from local equipment suppliers, which vowed to co-develop equipment with ASE.

ASE executives pointed out that the company will boost capacity of flip-chip packaging to three million to five million chips a month next year to cope with increasing demand. They noted that many of their company's customers focusing on chipsets and graphics chips have designed their products to fit flip-chip packaging methodology, a shift from BGA methodology, considering that flip-chip service is now much cheaper than BGA service.

With the expansion, ASE is estimated to become the world's No. 1 flip-chip assembler next year. So far this quarter, the company's flip-chip and BGA productions have been running at full capacity. The company attributed the busy production mostly to its R&D staff offering designs for leading-edge packaging all day long.