SEVENOAKS, England Warning of potential disaster ahead, market watchers here say they expect global wafer-processing capacity to surge by at least 50 percent between now and 2005.
The increased capacity includes an additional 400,000 eight-inch equivalent MOS wafer starts per week in China and Taiwan alone, up from current levels of 1.2 million wafers a week or a 33 percent increase.
With capacity expansions also expected at major independent device manufacturers such as Intel, Samsung, STMicroelectronics and Texas Instruments, the researchers, Future Horizons, question who will fund the work and how they will ever be repaid.
Is this buildup, the researchers ask, "another semiconductor industry disaster in the making?"
Taiwanese chip makers have 11 new 300-mm wafer fabs under way or on the drawing boards, Future Horizons notes in its December Semiconductor Industry Update Newsletter, attributing the figures to Gordon Shen, president of the Taiwan Semiconductor Industry Association.
Future Horizons notes that 11 12-inch wafer fabs are roughly equivalent to at least 25 advanced 200-mm wafer fabs, or a MOS capacity increment of some 200,000 eight-inch equivalent wafer starts per week. The market researcher says mainland China plans to build 25 advanced fabs by 2005 in its bid to "build a national chip industry," creating a similar level of added capacity.
"Taiwan's capital expenditure as a percent of revenues ran at 66 percent in 2000, and 55 percent in 2001, three times the normal industry average," the newsletter said. "Mainland China's figures are an awful lot higher. It rather begs the two obvious questions: Where is all the necessary funding going to come from and how is it ever going to be paid back?"
Peter Clarke writes for Semiconductor Business News, an EE Times Network Web site.