The scarcest thing in the AI supply chain is not always the processor. Sometimes it is the slice of resin, copper and glass the processor is mounted on. On Tuesday, a factory built to make more of that material opened in Singapore, the latest effort to loosen one of the tightest constraints in advanced computing.
The plant belongs to Advanced Substrate Technologies, a joint venture between U.S. chipmaker Broadcom and Japan’s Toppan Holdings, and it is the first factory in Singapore able to produce high-end flip-chip ball grid array substrates, the components known in the industry as FC-BGA. For Toppan, which has made the substrates at its main hub in Niigata, Japan, it is the first such plant outside the country.
The facility sits near the Jurong Lake District and spans about 95,000 square meters, with the first operating phase covering roughly 70,000 square meters. It has hired 315 people, more than 200 of them engineers and technicians, and it was brought online about three months ahead of schedule. The companies have not disclosed a full price tag, but Japanese media reported an initial investment of about 50 billion yen, or roughly 405 million Singapore dollars, with total spending including later expansion expected to exceed 100 billion yen. High-value manufacturing is scheduled to begin before the end of the year.
FC-BGA substrates do unglamorous but essential work. They carry the dense web of connections between a chip and the circuit board around it, and the large, many-layered versions needed for AI accelerators and network switches have been in persistent short supply as demand has outrun the industry’s capacity to build them.
Broadcom’s interest in the plant is direct. The company is Toppan’s largest customer for FC-BGA substrates and depends on the component for the custom AI accelerators it designs for Google, OpenAI, Anthropic and Meta. Chief Executive Hock Tan has told investors the company expects AI semiconductor revenue to reach about $115 billion in fiscal 2027 and roughly $230 billion in fiscal 2028, a doubling path that holds only if the substrates and memory behind those chips keep flowing.
Tan has been explicit that the outlook is anchored in secured supply, not extrapolation. He has told analysts the company has locked in the wafers, substrates and memory needed to reach the 2027 and 2028 figures, and that the real constraint is the pace at which land, power and data centers come online. Substrates are a small part of the bill of materials, but they are the part that can stall an entire shipment when they run short.
The executives who spoke at the opening framed the plant as a fix for a specific shortage. Charlie Kawwas, president of Broadcom’s Semiconductor Solutions Group, said the Singapore capacity “gives us meaningful flexibility and differentiation as demand for AI and networking silicon continues to climb,” and that a facility brought online early delivers relief “while the industry is constrained by substrate shortages.” Yoshiyuki Iida, the venture’s chief executive, said the plant helps address a bottleneck in AI and networking chip production.
Singapore’s government welcomed the project as a deepening of the country’s semiconductor role. The Economic Development Board and the industrial landlord JTC Corporation backed the plant, and Deputy Prime Minister Gan Kim Yong attended the opening. Singapore has long hosted wafer fabs, chip design and assembly, but advanced substrates add a layer of the supply chain the country had not previously occupied.
The choice of Singapore reflects more than government incentives. The city-state sits close to the assemblers and foundries that turn substrates, chips and memory into finished packages, and it offers the stability and logistics that a precision factory needs. For Broadcom, a supplier in the same region as its contract manufacturers shortens the distance between the components and the products that consume them.
For Toppan, the Singapore plant extends a business it has been building for years. The company, founded in Tokyo in 1900 as a printing house, now spans packaging, security and electronics, and it has said it aims to more than double its FC-BGA production capacity from the 2022 level by fiscal 2027. Singapore has served as a regional hub for the group, and the new factory anchors advanced packaging and AI supply chains across Asia.
Analysts said the opening addresses only part of the shortage. Substrate capacity is one of several bottlenecks in AI hardware, alongside high-bandwidth memory and advanced packaging, and a single plant, however early, cannot close the gap on its own. But every block of capacity added near a growing customer base shortens the wait for the components that the next generation of accelerators will consume.
The plant is one answer to a problem the whole industry is trying to solve. Substrate makers in Japan, South Korea and Taiwan have been adding capacity, and governments have been courting the investment, because the shortage sits exactly where the AI boom’s demand is most concentrated. Whether the Singapore plant, the first of its kind in the country, is enough depends on how fast demand for AI hardware keeps growing; what is clear is that it will not be the last factory built to make the material underneath the chips.
