World News
02/01/2006
BUSINESS TRENDS
Chipmaking tool sales bouncing back, says Semi
Following a stellar 67% climb in 2004, sales of semiconductor manufacturing equipment are seen declining 11% in 2005, but will bounce back to modest single-digit growth in 2006 and return to double-digit growth through 2008, according to data from Semi. Total equipment sales in 2005 are estimated to be $32.95 billion, rebounding in 2006 to $35.97 billion (9.1% growth), $40.40 billion in 2007 (12.3%), and $46.63 billion in 2008 (15.4%).
While capital spending in 2005 followed an anticipated cyclical decline, the numbers still show it was the third strongest year for worldwide tool sales, noted Semi president and CEO Stanley Myers. Suppliers can expect sequential gains for the next three years as chipmakers continue to invest in 300mm and 65nm technologies, he added.
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Backend segments were hit hardest during 2005 (assembly/packaging contracted 19%; test was down 17%), but they are expected to once again outpace overall equipment growth in 2006, and stay just behind the mark in 2007 and 2008.
Geographically, the only bright spot in 2005 was South Korea, where equipment sales rose 28% year-on-year. China (-54%) suffered through a big contraction in 2005, but is seen growing at a >20% clip through 2008. Hit hardest with hefty double digit contractions were Taiwan (-24%) and the rest-of-world regions (-35%).
WORLDWIDE HIGHLIGHTS
USA
Intel Corp. and Micron Technology Inc. are launching a JV to make and sell NAND flash memory chips, primarily to Apple Computer. Each company will supply IM Flash Technologies with an initial $1.2 billion and another $1.4 billion over the next three years. Intel also will pay Micron $270 million to license its NAND flash technology. Apple has committed to prepay $500 million to secure NAND supply from the venture, more than a third of its budgeted $1.25 billion spending for flash memory components over the next three months. Initial production is expected by early 2006.
MKS Instruments, a Wilmington, MA, provider of monitoring and control technologies for semiconductor and other manufacturing processes, has agreed to purchase Berkeley, CA-based Ion Systems, a provider of electrostatic management solutions, for ~$70 million. The transaction is expected to close in 6-8 weeks. Ion Systems had sales of roughly $35 million in its most recent fiscal year ended in June.
Photronics Inc., Brookfield, CT, and Micron Technology Inc., Boise, ID, are in talks to jointly develop advanced reticle technologies supporting fabrication of 45nm-and-below logic ICs. Work pursuing new equipment, materials, module development, and mask integration would begin in 1H06 primarily at Micron’s Mask Technology Center.
ASIAFOCUS
Public-private partnership SemIndia and Indian state government have announced plans to spend roughly $3 billion to build the first semiconductor manufacturing plant in India, licensing technology from AMD. The site, to include wafer fabrication as well an assembly-test-mark-pack operations, will be funded by a mix of backers including VC, debt financing, and strategic partnerships, as well as state government.
Thailand’s Board of Investment has revised its incentives for wafer fabrication and IC manufacturing businesses. The changes include exemption of import duties on upgraded or replacement equipment, and exemption of corporate income tax for up to eight years.
EUROFOCUS
Nanoident AG is planning a “two-digit million euro” investment to build a factory specifically for producing organic semiconductor sensors. Located in Linz, Austria, and online by 2006, the fab will have 100,000 sq. m production capacity.
Siltronic AG will invest ~136 million euros (US$160.6 million) to expand 300mm wafer production at sites in Burghausen, Bavaria, and Freiberg, Saxony, by roughly 50% to a combined 335,000 wafers/month.
Entegris Inc. said it will close a manufacturing facility in Bad Rappenau, Germany, redistributing work to other sites in the US and Asia. The move will eliminate 100 positions and cost $6.5 million in expenses and asset write-offs, but will save an estimated $2.0 million/year.