Foxconn and Yageo team up to form a semiconductor JV

In the future, XSemi will be based in Hsinchu, Taiwan and will draw from the strengths and resources of both companies. The new JV will – according to a press release from Foxconn – collaborate with other semiconductor companies in terms of product design, process and capacity planning, and sales channel. At the same time XSemi will create its own complete semiconductor supply chain and provide customers "total solution services with high-quality products and stable supplies," the press release reads. The new joint venture XSemi will deepen Yageo's and Foxconn's footprint in the semiconductor space, focusing on the development of semiconductor chips with average selling prices lower than USD 2.00, which they call “Small IC”. So far, the two parties state that they have started discussions with several global semiconductor companies, and will announce collaboration plans in the semiconductor industry in the near future. Young Liu, Chairman of Hon Hai, states in the press release that he believes that “the semiconductor industry is facing the biggest upheaval in the past three decades, and the industry order will face a serious restructuring. Now is undoubtedly the best timing to initiate strategic partnerships in various segments.” Foxconn is betting big on its semiconductor strategy, making it one of the three core technologies for the conglomerate. Within its reach in the semiconductor supply chain, Foxconn has built capabilities within semiconductor equipment, design services, IC design in 5G, AI, CIS (CMOS Image Sensors), and display driver, foundry fabs, and advanced packaging. XSemi‘s key product focus, small ICs, is said to become one of the most important elements of Hon Hai’s future plan. It will not only create a steady semiconductor supply to the company’s current communication applications and future emerging technologies, but also fulfill the needs of its international customers, the press release continues. for Yageo this new collaboration with Foxconn could be seen as a natural extension and progression of the strategic alliance which was initiative with the company last year. After the acquisition of KEMET and Pulse, Yageo has put an emphasis on high-end product development to consolidate technologies and channels to be close to its customers “Yageo aims to create a one-stop shop for its customers, and through this joint venture, we will further provide the services and products that meet customers’ need for supply chain optimization,” says Pierre Chen, Chairman of Yageo.