Taiwan will continue to be the world’s leader in semiconductor capital expenditure (capex) this year amid an industry-wide spending spree, according to a U.S.-based trade association report released June 1.
After a year of underinvestment, strong business growth, robust demand and rising chip prices, many companies are launching aggressive expansion plans in 2010, the Semiconductor Equipment and Materials International report stated.
Global shipments of semiconductor equipment in the first quarter of 2010 surged by 142 percent over the same period last year to US$7.46 billion, SEMI said.
The association predicts that fab spending will shoot up by 117 percent year-on-year to US$35.51 billion, compared with March projections of an 88-percent increase to US$27.2 billion. “This will be a banner year for the equipment and materials industry,” the report said.
Another SEMI report released June 9 predicts that total capex by Taiwan’s semiconductor sector is expected to expand by 77 percent year-on-year to US$7.7 billion in 2010, leading South Korea with US$7.4 billion.
“Rosy projections on demand are prompting foundries and memory firms worldwide to beef up their capex this year,” SEMI Senior Research Manager Clark Tseng told Taiwan Today June 10.
While most foundries embarked upon process upgrades in 2009, Tseng expects to see more expansions this year, pushing global installed capacities up by 13 percent in 2010, and another 11 percent in 2011. In contrast, memory makers in general will likely opt for process upgrades.
“The equipment and materials sectors will continue to show steady growth in 2011, but this potential will not be as impressive given a higher comparison base this year,” he said. SEMI expects to see 2011 fab spending up by 18 percent over 2011 to US$42.04 billion.
In a breakdown of individual spending, South Korea’s Samsung Electronics Co. Ltd. will be the leading investor with estimated capex of US$7.56 billion, followed by Taiwan Semiconductor Manufacturing Co. Ltd. with US$4.68 billion and U.S.-based Intel Corp. with US$3.64 billion.
Taiwan’s United Microelectronics Corp. and Inotera Memories Inc. are among those planning to spend over US$1 billion this year.
In related news, TSMC’s board approved capital appropriations totaling US$1.58 billion on several capacity expansion projects May 11. UMC also announced an annual capex budget of between US$1.2 billion and US$1.5 billion in its 2010 first quarter report. (SFC-JSM)
Write to Meg Chang at meg.chang@mail.gio.gov.tw