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Lack of onshore OSAT capacity presents security risks

The lack of onshore OSAT capacity could pose security risks. “We tend to get excited and animated about aspects of chip production like design and manufacturing, but the packaging is where, from a security perspective, the vulnerabilities actually become quite concerning,” Christian Rodriguez, an expert associate partner at McKinsey & Co.’s Aerospace and Defense practice in Washington, tells Aviation Week. “Packaging represents a handover in the ownership and control of the device from the manufacturer to the packager. It becomes a natural entry point for something to happen. If we can’t package chips, we have to send them somewhere else, potentially disrupting the supply chain and security.”

For that reason, boosting OSAT capabilities in the U.S. could strengthen overall resilience of the semiconductor supply chain. “We want to build more capacity onshore so that [at] least for mission-critical, safety-critical, high-consequence-of-failure systems, more of that final packaging is being put in place somewhere with a high degree of assurance and trust,” Rodriguez says.

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