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The growths of automotive and industrial applications have boosted demand for IC packaging materials such as leadframes, according to industry sources.
IDMs remain relarively optimisitc about mid- to long-term outlook, the sources added.
In addition to Infineon, STMicroelectronics, Onsemi, and Rohm Semiconductor, more power semiconductor suppliers are leaning toward modular products, spurring demand for customized leadframes used in IC packaging. According to the estimates of Taiwan-based leadframe makers SDI and Jih Lin Technology, more than 40% of their revenues in 2022 would source from car-grade products.
Chang Wah Technology (CWTC) is a major supplier of IC packaging leadframes. It plans to raise quotes in the second quarter of 2022 to reflect rising costs. It estimates the ratio of consumer electronics to its revenue would drop below 40% by the end of this year. Automotive applications and industrial control units contributed 35% and 18% to its first-quarter revenue, the company said.
Among different types of leadframes, quad flat package (QFP) is most widely used in automotive chips, resulting in its price hikes that has exceeded quad flat no-lead (QFN). QFN and aQFN (advanced QFN) frames are used in networking devices, and their demand remains stable.
COVID-19-induced lockdowns in Shanghai continue to affect many firms' operations.
ASE Group's Siliconware Precision Industries (SPIL) has a production base in Suzhou, while a bulk of materials it needs are stuck in the neighboring Shanghai's customs. The company is seeking alternatives to ease the problem, but it admitted its production schedule has been delayed to a certain degree.
CWTC chairman Huang Chia-neng said China's lockdowns cause many uncertainties in materials logistics. Nonetheless, demand for packaging materials such as leadframes, epoxy resin, and substrates will pick up later due to the growths of vehicle electronics, 5G, Wi-Fi 6, third-generation semiconductors, and miniLED, he said.
CWTC has set the goal of producing 130 million QFN frames annually by 2025. Its new plant will be inaugurated in the third quarter of 2022 and make contributions to its 2023 revenues. The company also plans to expand stamping production lines in the fourth quarter of 2022.
As for the consumer electronics sector, demand for networking device chips remains brisk. MediaTek, Qualcomm, Broadcom, and Intel are promoting new-generation Wi-Fi SoCs.
The in-house packaging capacities of IDMs and demand for OSAT services are robust. Demand for leadframes is buoyed by growing needs for car-grade microcontroller units, in-vehicle computer chips, and power modules. Power modules and Si IGBT components for industrial control are in short supply.
Amid multiple uncertainties in the market, many IDM and OSAT firms are modifying their market strategies by laying greater emphasis on automotive and industrial applications and less on consumer electronics.
By DIGITIMES