Semiconductor sales have been so hot this year, they’ve not only pushed global manufacturers to boost production and squeeze every chip possible off production lines, they’ve also spurred massive spending on new fabrication plants and production line equipment. Production lines at Japanese automotive chip maker Renesas were whirring along so fast at its Naka Factory, it literally caught fire on March 19 of this year. With business so good, it’s no wonder semiconductor manufacturers are clamoring to build new capacity.
The latest forecast update from SEMI, the chip equipment industry association, substantially raised the full year targets for 2021 and 2022.
SEMI now forecasts fab equipment spending to reach a record high US$84 billion this year, up 30% from 2020 and a big increase from its previous forecast of a 15.5% gain this year.
Back in March, when SEMI put out its prior forecast, it said chip equipment spending would not exceed $80 billion until 2022.
So the revision in 2021 spending is substantial.
Spending will continue to grow in 2022, SEMI says, forecasting an 11% gain next year to $93 billion, which will be yet a new all-time high.
The previous record was $71.2 billion in 2020.
This year, the biggest spenders are in the foundry sector, companies like TSMC, Samsung and Intel, followed by the memory sector, then microcontroller units and discretes (mainly power management chips), while the opto sector will also see double digit growth, SEMI says.
Dozens of new chip factories are being built as well.
There are 14 new chip fab projects slated for 2021, with construction spending up 31% to $16 billion, according to SEMI.
Construction spending will continue at a frantic pace in 2022 with a 45% increase to $23.8 billion, “which is the highest amount for construction spending on record,” SEMI said.
Related Links: Renesas Press Release (March, 2021): https://www.renesas.com/us/en/about/press-room/notice-regarding-semiconductor-manufacturing-factory-naka-factory-fire-summary-updates SEMI Data (June, 2021): https://www.semi.org/en/news-resources/market-data/world-fab-forecast-report-highlights-q2-2021
SEMI Release (March, 2021): https://www.semi.org/en/news-media-press/semi-press-releases/world-fab-forecast
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