Ayala’s IMI braces for power shortage

MANILA, Philippines - Integrated Micro-Electronics Inc. (IMI), the electronics manufacturing services unit of Ayala Corp. is bracing for the effects on its business operations of the power deficiency that is expected to occur in Luzon by summer next year.

IMI also expressed concern for other semiconductor and electronics manufacturing operations in the country.

“Power shortage is going to be a problem, because we’re in one of those industries that require low cost and quality power,” IMI president and chief executive officer Arthur Tan told The STAR in an interview.

“We do have generators that will help keep us running but will definitely change our cost model, making it more costly to run,” he added.

IMI currently operates five manufacturing plants in the Philippines. One of the largest electronics manufacturing services, power semiconductor assembly and test services company in the world, it serves diversified markets that include those in the automotive, industrial, medical, telecommunications infrastructure, storage device, and consumer electronics industries.

Tan, who also serves as chairman of the Semiconductor and Electronics Industries in the Philippines Inc., said the power-intensive electronics manufacturing industry needs strong assurance from the government on provision of a reliable and sustainable energy supply.     

“It’s a problem that is at the top of our mind, but it should be managed by the government. It is the government’s mandate to make sure to provide an economically viable energy platform for the country to remain competitive because if we cannot prove it is capable of making those sound decisions and plans, then who will we attract to come and build a manufacturing investment in the country?” Tan said.

“So this is a test case as to what political will the government has in terms of developing the manufacturing sector,” he added.

The government has already called for emergency powers to be granted to the President to address a foreseen power shortage in Luzon by summer next year.

IMI is eyeing to be the first Filipino-owned electronics manufacturer to earn billions of dollars in revenues in the near term, barring any major geopolitical issues or calamities.

As of the first nine months of the year, IMI continued to post strong revenue growth.

Its consolidated revenues for the period ending September already grew by 19 percent to $650.1 million from $547.1 million a year ago.