Theses›Semiconductor manufacturing›Legacy assembly

Legacy assembly

Traditional packaging is a mature, commoditised layer where profit is leaving for advanced packaging, and nothing in it opens with time.

  • Bear
  • Shut
  • $82B by 2035

The callThe bear case is more likely: every step is held by entrenched incumbents or already a commodity, the assembly houses run at 15-25% gross margin, and the shift to panels is incumbent-led. The market grows from $47.0B to about $82.1B by 2035 with chip volumes.

D1D2R1R2R3C1C2foragainst D1D2R1R2R3C1C2foragainst
Fig. 1The balance. Drivers and catalysts against restraints, each block sized by its weight; catalysts hang dashed because they have not happened yet, sized by their odds. It tips toward the restraints.
  1. D1AI packages outgrow round 300mm wafers, so packaging moves to large rectangular panels, where tools and placement built for wafers don't hold fine pitch.
  2. D2The EU's PFAS restriction may force new encapsulant chemistry the mould-compound oligopoly's formulations don't survive.
  3. R1Every step is held by entrenched incumbents or is a commodity, and the assembly houses run at 15-25% gross margin.
  4. R2The panel-level shift is captured by the same incumbents: ASE's line, TSMC's glass panels, CHIPS Act money to advanced packaging.
  5. R3A panel line costs about $200M (ASE's), and the listed ceiling, Kulicke & Soffa, is about $4.5B.
  6. C1The EU's PFAS restriction reaches the Commission with no long derogation for fluorinated encapsulants and mould compounds, forcing new chemistry the oligopoly's formulations don't survive. SEAC refused to exclude fluoropolymers in its March 2026 draft.2027
  7. C2Panel-level packaging reaches volume (Samsung Electro-Mechanics from late 2027, TSMC and Rapidus 2028), opening placement, inspection and plating sockets on 600mm panels that wafer tools don't serve.2028
Rests onthe beliefs underneath
Supported by · confidence
What would prove itdated tests, open and resolved
20272028today12watch 20272028today12watch
Fig. 2Each ring is a dated test: dashed while open, struck through when overdue, ticked or crossed once resolved.
  1. 1A non-incumbent reaching pilot yield in panel-level packaging.Dec 2027 · open
  2. 2The EU PFAS restriction forcing a new encapsulant held outside Resonac, Sumitomo Bakelite and KCC.Dec 2027 · open
Expressionslisted, private, technologies
  • 0522.HKASMPT Limited
    • cheap
  • ASXASE Technology
    • expensive
     Largest OSAT — packaging + test.
  • BESI.ASBE Semiconductor (Besi)
    • cheap
  • KLICKulicke & Soffa
    • full
  • AMKRAmkor Technology
    • not screened
     Second-largest OSAT: leadframe, laminate, power-discrete and wafer-level packaging and test sold to chipmakers.
  • 600584.SSJCET Group
    • not screened
     China's largest OSAT: wire-bond, flip-chip, SiP and wafer-level packaging and test for domestic and global chipmakers.
  • 002156.SZTongfu Microelectronics (TFME)
    • not screened
     Chinese OSAT packaging and testing chips for AMD and domestic chipmakers, across wire-bond and flip-chip packages.
  • 6239.TWPowertech Technology (PTI)
    • not screened
     Taiwanese OSAT focused on memory packaging and test (DRAM, NAND) plus logic, sold to memory makers.
Private · 2 private companies, 2 of them in China.

Forehope Electronic (Ningbo) · Jiangsu Silicon Integrity Semiconductor (JSSI)

Technologies
Who has already bet on itprivate rounds, from public sources

$239M raised by 2 companies. Early: Little money in so far; a lead investor would set the pace.