AI tech suppliers unfazed by US vote

• By Lisa Wang / Staff Reporter, in Tainan

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Taiwan’s leading artificial intelligence (AI) hardware suppliers do not expect the Democrats’ wins in the US midterm elections to affect customer demand, with severe capacity shortages remaining a primary constraint, several company executives said last week.

Some of the Democratic victors campaigned on pledges to clamp down on data centers, raising concerns about AI infrastructure deployment in the US.

The political factor would not slow down King Yuan Electronics Co’s (京元電子) planned US capacity expansion of up to US$1.4 billion, company president Gauss Chang (張高薰) told reporters at a news conference ahead of an annual semiconductor materials forum in Tainan on Friday.

MediaTek Inc advanced packaging technology business deputy general manager Shang Hou, right, speaks as executives of other companies look on at a technology forum in Tainan on Friday.

Photo: Lisa Wang, Taipei Times

“The project will move forward as planned now that all details have been finalized,” Chang said.

The company’s long-term strategic commitment would be unaffected, he said, adding that it would closely monitor political developments in the US.

Unimicron Technology Corp (欣興電子), a supplier of IC substrates to Nvidia Corp, said the election results had not yet dented customer demand.

“Customers are chasing us for capacity, while we are chasing suppliers to keep up with demand. This indicates that AI demand has outpaced what the whole ecosystem can supply,” Unimicron executive president Mike Ma (馬光華) said.

Driven by a severe capacity crunch, lead times for critical manufacturing equipment in the printed circuit board and IC substrate supply chain have stretched to as long as three years, Ma said.

The supply bottleneck is so severe that some equipment vendors have stopped accepting orders for delivery before 2028, he said.

“The supply chain bottlenecks are highly fluid,” Ma said.

Unimicron’s primary operational constraint has shifted to equipment procurement, which is compounded by a heavy reliance on overseas machinery suppliers — primarily in the US and Japan — making the bottlenecks much harder to navigate, he said.

Under these circumstances, Unimicron is hesitant to commit to further capacity expansions despite financial support from customers, Ma said.

However, investors should not worry about “AI overheating” any time soon, given persistent supply chain shortages, he said.

Overwhelming demand has triggered widespread supply constraints across the semiconductor ecosystem, MediaTek Inc (聯發科) vice president for advanced packaging technology Shang Hou (侯上勇) said.

“MediaTek has to fight for wafer allocation and advanced packaging capacity. Even for IC substrates, we have to book our slots way ahead of time,” Hou said. “All told, we still face a long runway of challenges before these products actually reach the customers.”

Ta Liang Technology Co (大量科技), which supplies advanced back-drilling machines with charge-coupled device alignment to Unimicron and other substrate makers, has secured orders for delivery next year, company general manager Eric Yu (游善溥) said.

Those orders were secured about two months ahead of schedule, as most technology companies finalize supply contracts for next year by the end of this year, he said.