Meaning
Manufacturing loss thresholds established in semiconductor packaging agreements define the acceptable percentage of units destroyed during the assembly process. This osat assembly yield attrition allowance accounts for the physical reality that some silicon dies will be damaged during wire bonding or encapsulation. Outsourced assembly and test providers use this figure to set price expectations with their clients.
The boundary is set by the difference between gross starts and net good units.
Material Waste
Physical components such as lead frames or molding compounds are consumed regardless of whether the final chip functions. The osat assembly yield attrition allowance provides a buffer for these wasted materials in the final invoice. If the actual loss exceeds the agreed limit, the provider typically bears the cost of the lost silicon.
Precision in the assembly line reduces this scrap.
Cost Allocation
Responsibility for the financial impact of failed units is distributed between the designer and the assembler based on this percentage. When the osat assembly yield attrition allowance is set at one percent, the customer pays for a small amount of expected failure as part of the standard unit cost. This arrangement simplifies billing by avoiding disputes over minor routine losses.
Large deviations trigger formal quality audits.
Process Maturity
New packaging technologies often require a higher initial margin for error than established methods. As a production line stabilizes, the osat assembly yield attrition allowance is usually renegotiated downward to reflect improved efficiency. This reduction in the allowed loss directly lowers the landed cost for the semiconductor company.
Continuous monitoring ensures the allowance matches the actual performance of the equipment. Vendors often provide detailed reports to justify the current threshold during these negotiations.
