Zhending: AI Still in Infrastructure Phase, ABF Shortage Unlikely to Be Resolved Within 3 Years

(CNA Taipei, July 7) Zhending chairman Shen Ching-fang, a global PCB manufacturer, stated today that AI is currently still in its infrastructure development phase, with the application layer not yet fully deployed. He anticipates that the growing demand for AI servers, high-performance computing, and humanoid robots will continue to drive demand for high-end PCBs.

He pointed out that the ABF substrates used in AI servers are increasing in size. However, due to increased material consumption and higher manufacturing complexity, the supply-demand gap is unlikely to improve in the short term, and it is estimated that it will remain difficult to alleviate within the next 2 to 3 years.

The General Chamber of Commerce held a lecture today, inviting Zhending chairman Shen Ching-fang to give a keynote speech. Regarding market concerns about whether AI investment is overheating, Shen Ching-fang said that the AI industry is currently in the infrastructure development stage, with ongoing construction in areas such as energy, GPUs, computing power, and large models. Cloud AI servers, edge computing, and future quantum computing are all important foundations supporting AI development.

He noted that the subsequent development of AI is not limited to servers. As technologies such as optical modules, 5G to 6G, and edge AI evolve, they will bring a new wave of PCB demand. Zhending is optimistic about the long-term trend of AI and continues to increase capital expenditure. The original plan for this year was an investment of approximately NT$50 billion, which was later increased to NT$80 billion, maintaining a high level of investment.

Shen Ching-fang stated that PCB factory construction requires a considerable amount of time and necessitates early planning. Zhending has grown from having no factories 20 years ago to becoming the global PCB leader today, maintaining its industry-leading position for the ninth consecutive year. This is primarily due to the foresight of continuous growth in the PCB industry and its long-term operational value. He mentioned that in the past, Taiwan had a misconception about the PCB industry being "unloved by parents," but the AI wave in the last two years has led the public to re-recognize the importance of PCBs.

Regarding the ABF substrate supply gap, Shen Ching-fang stated in an interview before the event that it is still difficult to resolve in the short term. He pointed out that the ABF substrates used in AI servers are increasing in size, which not only increases material consumption but also makes process yield control more challenging. "Currently, it is quite tight, and we probably won't see a supply-demand easing situation within 2 to 3 years."

When discussing South Korea's active expansion of its AI ecosystem through national efforts, Shen Ching-fang said that AI is a field actively being pursued by countries worldwide, not just South Korea. He believes that Taiwan has advantages in the AI hardware sector, especially in vertical supply chain division and integration capabilities, which remain a global strength. Taiwan should continue to build its own foundation well and not overly worry about the competition and development of other countries. (Editor: Chang Chun-mao) 0707

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