Samsung Electro-Mechanics Flashes Red on Glass Substrate Customer Evaluation... Investment Pushed Back Too Samsung Electro-Mechanics' investment schedule for semiconductor glass substrates is slipping. A bottleneck has emerged in the customer's prototype reliability evaluation. As a result, the timeline for building out the production line at GlaSSEM, the glass core joint venture, has also been pushed back, and the timing of related equipment orders has become murky. According to multiple industry officials on the 12th, GlaSSEM, the glass core joint venture between Samsung Electro-Mechanics and Dongwoo Fine-Chem, has been unable to give its partners an equipment order schedule. One industry official said, "As recently as the end of July the mood was that orders were imminent, but right now it is hard to predict when they will resume," adding, "The schedule has been postponed several times, so at this point it has become difficult even internally to roughly estimate when orders will be placed." Samsung Electro-Mechanics had been conveying equipment orders to partners for the GlaSSEM production line since November last year, but the schedule was pushed back at least three times, to December last year, then March, then June this year. After June, guidance on any follow up schedule disappeared altogether. The industry points to the failure to obtain reliability evaluation certification for the glass substrate prototype from a global communications chip customer. A person familiar with the matter said, "I understand that the investment schedule was halted because Samsung Electro-Mechanics failed to pass the reliability evaluation," and "Since the prototype has to be remade and resubmitted, further delays to the existing schedule are unavoidable." The person added, "Because a new prototype cannot be produced within one or two weeks, whether the line investment happens within this year is also uncertain." Samsung Electro-Mechanics is currently making glass substrate prototypes at its Sejong campus. To move to initial volume production, the step after pilot production, it is preparing to build a production line at GlaSSEM, the joint venture with Dongwoo Fine-Chem, a subsidiary of Japan's Sumitomo Chemical. Selection of the main process equipment suppliers, covering deposition, etching, laser drilling and inspection, is mostly complete. Last month, expectations ran high among equipment makers that orders would begin in August. Samsung Electro-Mechanics had planned to start with deposition tools, which carry the longest lead times, bring the main process equipment into Dongwoo Fine-Chem's Pyeongtaek campus and install it by April next year, and complete the initial production line within the second quarter. It is also known to have considered placing orders for long lead time equipment under the Samsung Electro-Mechanics name first and then transferring the contracts to GlaSSEM. A delay to Samsung Electro-Mechanics' glass substrate mass production timeline has likewise become unavoidable. Even if orders are placed within this year, factoring in equipment build times, the production line would be ready in the second half of next year at the earliest. The start of mass production is understood to have been pushed out to 2028 or later. When GlaSSEM was established early last month, Samsung Electro-Mechanics presented a target of operations starting in the second half of 2027. At the recent second quarter earnings announcement, less than a month later, it revised the start of operations to 2028.

Samsung Electro-Mechanics Flashes Red on Glass Substrate Customer Evaluation... Investment Pushed Back Too Samsung Electro-Mechanics' investment schedule for semiconductor glass substrates is slipping. A bottleneck has emerged in the customer's prototype reliability evaluation. As a result, the timeline for building out the production line at GlaSSEM, the glass core joint venture, has also been pushed back, and the timing of related equipment orders has become murky. According to multiple industry officials on the 12th, GlaSSEM, the glass core joint venture between Samsung Electro-Mechanics and Dongwoo Fine-Chem, has been unable to give its partners an equipment order schedule. One industry official said, "As recently as the end of July the mood was that orders were imminent, but right now it is hard to predict when they will resume," adding, "The schedule has been postponed several times, so at this point it has become difficult even internally to roughly estimate when orders will be placed." Samsung Electro-Mechanics had been conveying equipment orders to partners for the GlaSSEM production line since November last year, but the schedule was pushed back at least three times, to December last year, then March, then June this year. After June, guidance on any follow up schedule disappeared altogether. The industry points to the failure to obtain reliability evaluation certification for the glass substrate prototype from a global communications chip customer. A person familiar with the matter said, "I understand that the investment schedule was halted because Samsung Electro-Mechanics failed to pass the reliability evaluation," and "Since the prototype has to be remade and resubmitted, further delays to the existing schedule are unavoidable." The person added, "Because a new prototype cannot be produced within one or two weeks, whether the line investment happens within this year is also uncertain." Samsung Electro-Mechanics is currently making glass substrate prototypes at its Sejong campus. To move to initial volume production, the step after pilot production, it is preparing to build a production line at GlaSSEM, the joint venture with Dongwoo Fine-Chem, a subsidiary of Japan's Sumitomo Chemical. Selection of the main process equipment suppliers, covering deposition, etching, laser drilling and inspection, is mostly complete. Last month, expectations ran high among equipment makers that orders would begin in August. Samsung Electro-Mechanics had planned to start with deposition tools, which carry the longest lead times, bring the main process equipment into Dongwoo Fine-Chem's Pyeongtaek campus and install it by April next year, and complete the initial production line within the second quarter. It is also known to have considered placing orders for long lead time equipment under the Samsung Electro-Mechanics name first and then transferring the contracts to GlaSSEM. A delay to Samsung Electro-Mechanics' glass substrate mass production timeline has likewise become unavoidable. Even if orders are placed within this year, factoring in equipment build times, the production line would be ready in the second half of next year at the earliest. The start of mass production is understood to have been pushed out to 2028 or later. When GlaSSEM was established early last month, Samsung Electro-Mechanics presented a target of operations starting in the second half of 2027. At the recent second quarter earnings announcement, less than a month later, it revised the start of operations to 2028.

Source:https://x.com/jukan05/status/2087415382638490041