Showa Denko Materials Co., Ltd. has decided to expand its production capacity of copper-clad laminates for semiconductor package substrates. Specifically, the company will be introducing a production line and additional equipment by 2025 at its Shimodate Works and Group company Showa Denko Semiconductor Materials (Taiwan) Co., Ltd. (SDSMT).

In relation, Showa Denko Materials plans to invest approximately 10 billion yen (US$70.4 million) to meet the rapidly growing demand for semiconductor package substrates. This, in turn, was driven by the increasing use of semiconductors for communications infrastructure supporting 5G and post-5G networks. This expansion is expected to roughly double Showa Denko Materials Group’s current output capacity of the product.

Rising Demand for Semiconductor Packages

The demand is rising for large servers in data centers and other devices with semiconductor packages capable of processing even more enormous amounts of data at higher speeds. This trend comes as remote work becomes commonplace amid the novel coronavirus pandemic and 5G coverage extends further.

In particular, there is an increasing need for thicker semiconductor package substrates to enlarge areas and reduce warpage. Thus, it is expected that copper-clad laminates used for the substrates will see 15 percent growth,^*1 a level exceeding the semiconductor market.

To meet the growing demand for this substrate material, Showa Denko Materials has decided to invest in facilities to expand production. Specifically, it will install a production line and additional equipment for copper-clad laminates for semiconductor package substrates at Shimodate Works and SDSMT.

Largest Investment in Copper-Clad Laminates

Shimodate Works will set up an integrated production line by 2025. Meanwhile, SDSMT will enhance some process capabilities to upgrade its existing production line. The investment in the two locations will total 10 billion yen (US$70.4 million), the largest amount spent on Showa Denko Materials’ copper-clad laminate business in the past several years.

Showa Denko Materials has established a copper-clad laminate supply system at four manufacturing sites. That include Shimodate Works; SDSMT; Group company SD Electronic Materials (Hong Kong) Limited; and SD Electronic Materials (Guangzhou) Co., Ltd. The latter is another Group company in China that began production in 2021. The new investment is expected to boost the Group’s output capacity of its copper-clad laminates for semiconductor package substrates to roughly double the current level.

Showa Denko Materials’ copper-clad laminates for semiconductor package substrates have a strong reputation for their excellent packaging reliability. These include warpage properties and flatness. Also, they hold the world’s top market share in value terms (FY2021).^*2 This material is especially recognized as indispensable to semiconductor packages for data center servers and other devices requiring high packaging reliability.

The Showa Denko Group positions semiconductor materials as a core growth business driving future growth. Showa Denko Materials will bolster its supply chains for copper-clad laminate products to meet rising semiconductor demand and outpace market growth.

^*1 Based on Showa Denko Materials’ survey.

^*2 Source: Prismark Partners LLC.