A document from Vietnam’s environment ministry reveals that Shunsin, a subsidiary of Taiwanese giant Foxconn, is seeking approval for an $80 million investment in northern Vietnam aimed at integrated circuit production. The planned facility in Bac Giang province will specialize in manufacturing and processing electronic components, particularly integrated circuit boards. Shunsin intends to commence full-scale operations by December 2026, targeting an annual production capacity of 4.5 million units. The company has not yet responded to Benzinga’s request for comment.
Shunsin is part of Foxconn, the world’s largest contract manufacturer of consumer electronics products such as iPhones and iPads. It is also an investor in technology companies, including Apple Inc. (AAPL). It is also a significant maker of system-in-package modules (SoPs). The company returned to profitability last year, and the group’s chief executive officer, Young Liu, has set out a plan to transform Foxconn into an “intelligent” business by focusing on artificial intelligence and semiconductors while expanding its existing product innovation pipeline.
The SoP manufacturing market is booming as manufacturers move to smaller, thinner devices with more advanced functions, such as facial recognition. This creates a greater need for microprocessors, which are essential to the operation of such smart devices. The SoP market is estimated to grow by 9% to $80.8 billion by 2022, making it one of the fastest-growing markets for chip makers.
Companies producing SoPs will need to increase their production capacities to meet increasing demand. As a result, many companies are investing in new facilities in regions with large populations that can support the manufacturing requirements. This is why China is a leading SoP manufacturing region, and other countries are also attracting major investments from these manufacturers.
Besides expanding production lines, the firms will need more talent to work in these plants. This is why they are setting up training centers in these regions to train workers on the latest technologies. Some of these courses include augmented reality and robotics, allowing workers to use these tools to increase productivity.
US tech companies have warned that a Vietnamese draft law that tightens data protection rules and limits transfers of personal information abroad could hamper their growth in the country, especially their plans to expand their data centers there. The draft law was introduced to parliament in late August and is scheduled to pass by Nov 30.
As a result, companies such as Facebook and Google are considering other locations for their data centers or limiting the amount of data they transfer to Vietnam. In addition, the draft law could discourage investors from building factories in the country to assemble smartphones and other devices. The government is reviewing the law but has not announced its final decision. The draft law would require foreign investors to make significant capital contributions before establishing a plant in the country. In addition, the law would require companies to give the government the right to monitor their data and communications.
