TO All,
American Fine Wire expands during Asian crisis
SINGAPORE, Feb 16 (Reuters) - American Fine Wire (AFW), a subsidiary of Kulicke & Soffa Industries, Inc, (KLIC -
news; K&S) which makes bonding wire for the semiconductor industry, opened a new $5 million production plant in Singapore
on Monday.
Don May, vice president of worldwide sales of Packaging Materials Group, a K&S affliated company, said Asia's economic
crisis had not put off expansion, simply introduced new challenges.
May said more than 50 percent of all semiconductor bonding wire shipped by AFW went to businesses in Asia.
Much of AFW's customer base in Asia was made up of semiconductor factories owned by multinational corporations, but a
substantial section is ''homegrown Asian owned companies,'' he said.
May said while multinationals were pulling through without many credit problems, a few of his customers in Thailand and
elsewhere had run up substantial debts to AFW.
May said he had found that some of his competitors had cut credit to some of those customers. That attitude is self-defeating in
many cases, he added.
''They can't pay us back without running the plant and they can't run the plant unless they have our product.''
May cited an unnamed customer in Thailand who had run up a substantial debt with AFW and other suppliers.
AFW's competitors cut credit to the company while AFW maintained relations to make sure it continued to operate and earned
enough money to pay down its debt.
Now several weeks later, not only has the Thai customer paid off much of what it owes, but AFW has captured 100 percent of
its business.
May said not all troubled customers would get that sort of deal, but careful selection and evaluation could turn today's credit
risks into tomorrow's devoted customers.
AFW expects revenue from Asia in 1998 to be flat or in excess of 1997.
For the past few years, the semiconductor industry in Asia has grown at a rate of 15-20 percent per year and AFW was betting
resumption of that growth rate is not far off, May said.
AFW's Singapore gold wire producing operation is 10 years old, and 80 percent of its production is exported to other countries
in Southeast Asia. |
