Burning Down the House
Last November we noted that a fire at a Unimicron (3037.TT) PCB factory in Taoyuan, Taiwan had caused enough damage as to limit the company’s supply. As the 3rd largest producer of PDBs, the limitations on capacity, which was already tight, were heightened, particularly for more advanced FCCSP (Flip Chip – Chip Scale Packaging) products, which have an even more limited supply base. Ironically, the Taoyuan Fire Department was called back to the same plant yesterday after an acetylene torch being used to dismantle equipment damaged in the November fire, caused another fire that brought in 42 vehicles and more than 100 FD personnel.
After the first fire, expectations were that the plant would resume full production sometime in the first quarter of this year, although that timeline seems to be in jeopardy currently, although the company has stated that they do not expect a change to the previous restoration timeline. This Unimicron plant produces boards for Qualcomm’s (QCOM) 5G Application Processor, and is also part of Apple’s (AAPL) iPhone supply chain, so production constraints are a sensitive issue. There are other FCCSP sources, such as Samsung Electro-Mechanics (009150.KS), Daeduck Electronics (353200.KS), and Korea Circuit (007810.KS) that can also produce same, but given how tight the market was going it, we expect buyers will have to pay up to garner supply to offset the Unimicron issue
After the first fire, expectations were that the plant would resume full production sometime in the first quarter of this year, although that timeline seems to be in jeopardy currently, although the company has stated that they do not expect a change to the previous restoration timeline. This Unimicron plant produces boards for Qualcomm’s (QCOM) 5G Application Processor, and is also part of Apple’s (AAPL) iPhone supply chain, so production constraints are a sensitive issue. There are other FCCSP sources, such as Samsung Electro-Mechanics (009150.KS), Daeduck Electronics (353200.KS), and Korea Circuit (007810.KS) that can also produce same, but given how tight the market was going it, we expect buyers will have to pay up to garner supply to offset the Unimicron issue
2nd Unimicron Plant Fire - 2-4-21 - Source: Taiwan English news
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