ASE Holdings' North American subsidiary, ISE Labs, has announced a land acquisition in Guadalajara's Axis 2 industrial park, marking its first packaging facility expansion outside the US. The move comes amid potential supply chain uncertainties following the recent US presidential election.
The new facility will provide semiconductor chip packaging and testing services, strengthening ASE's global presence and enhancing its market opportunities in North America. This expansion represents ISE Labs' first venture beyond its existing US operations in Fremont and San Jose.
According to ASE, the facility is projected to create more than 500 jobs within its first year. To support workforce development, the state's Economic Development Department (SEDECO), Innovation, Science and Technology Department (SICyT), and Education Department will facilitate partnerships between ISE Labs and local educational institutions and chambers of commerce.
The choice of location is strategic, as Jalisco represents approximately 70% of Mexico's semiconductor production. The region's significance stems from its high-paying jobs and ongoing technological innovation within its tech ecosystem.
In a parallel development, ASE's subsidiary, Ennostar, has also acquired land in Jalisco to expand its EMS business, serving cloud, industrial control, and automotive clients in North America. These dual investments highlight ASE's strengthening relationship with local authorities.
While ISE Labs traditionally focused on testing services at its North American facilities, this Mexican expansion introduces packaging capabilities alongside testing operations, demonstrating a significant commitment to supply chain localization.
Industry sources note that the decision to establish packaging production lines in Mexico aligns with the need for cost-effective locations compared to testing operations, making Mexico a more attractive option than the United States.
However, concerns have emerged regarding potential high tariffs on Mexico under the new Trump administration, prompting tech supply chain companies to reevaluate their US production strategies. The industry is particularly focused on the impact of US-Mexico border issues, given Mexico's established testing and assembly infrastructure. ASE has not yet addressed how these developments might affect its new Mexican facility.
