ASE head vows to fix pollution: mayor

EAGER TO RESUME::Analysts agree a shutdown of one to two months will not dent ASE’s supply chain, with the firm helped by the global IC industry’s slow season

Staff writer, with CNA

Mon, Dec 23, 2013 - Page 13

Advanced Semiconductor Engineering Inc (ASE, 日月光半導體) chairman Jason Chang (張虔生) promised yesterday that “every drop of wastewater” from the company will meet environmental standards in the future, Greater Kaohsiung Mayor Chen Chu (陳菊) said.

ASE is also expected to submit an improvement plan today on its wastewater treatment, as required by the Greater Kaohsiung’s Environmental Protection Bureau, so that the company can resume operations at its K7 plant as soon as possible, Chen said.


Chen made the remarks after a closed-door meeting with Chang and other senior ASE executives, including chief operating officer Tien Wu (吳田玉) and president Raymond Lo (羅瑞榮) of the company’s Greater Kaohsiung plant.

On Friday, the Environmental Protection Bureau ordered the closure of several assembly lines at ASE’s K7 plant in the city’s Nanzih Export Processing Zone.

The factory was caught in violation of environmental protection rules, discharging wastewater contaminated with heavy metals into the nearby Houjin River (後勁溪).

Chang said he hoped the plant could resume operations as soon as possible to safeguard the interests of ASE customers and workers, the mayor said.

The production lines responsible for the high levels of nickel found in the K7 plant’s wastewater were shut down, which affected 40 percent of the 5,000-strong workforce.


ASE said on Friday the partial shutdown at the K7 plant may result in a monthly loss of up to US$18 million, adding that the plant accounts for about 9 percent of the company’s monthly sales.

Andrew Chen (陳治宇), an analyst with Yuanta Investment Consulting Co (元大投顧), said the semiconductor supply chain has one to two months of inventory to handle a drop in packaging and testing services caused by the shutdown.

Chen said as long as the lines can reopen soon, the impact on the supply chain will be limited.

Other analysts agreed, saying that by relocating some packaging and testing equipment to other plants in the Nanzih Export Processing Zone, or shifting production to another complex in Taoyuan County’s Jhongli (中壢), ASE would be able to tolerate the impact in the short term.

They added that the fourth quarter of this year and the first quarter of next year make up the slow season for the global IC industry.

The analysts also said that some integrated circuit (IC) designers have contacted ASE’s rivals to check the possibility of taking orders from these fabless IC suppliers if the K7 plant shutdown is lengthy.

Without a quick reopening, ASE would face difficulties retrieving orders lost to its rivals, including South Korea’s Amkor Technology Inc, Singapore’s STATS-ChipPAC Ltd and Taiwan’s Siliconware Precision Industries Inc (矽品精密), they added.