Chip Makers Respond to Demand Surge
June 24, 2021
As we reported, Globalfoundries broke ground this week on a new 300-mm fab in Singapore, one of a projected 19 new high-volume fabs to be built by the end of this year, according to the industry group SEMI.
Those fabs along with another ten expected to be built in 2022 respond to insatiable demand for semiconductors, fueling an equally vibrant chip equipment sector expected to surpass $140 billion over the next several years, according to a SEMI forecast.
Taiwan Semiconductor Manufacturing Co. (TSMC) and other Taiwanese chip manufacturers are projected to construct six new fabs in the coming year, with two more coming online in 2022. TSMC has said it plans to invest about $100 billion over the next three years to increase foundry capacity.
Not far behind, Chinese manufacturers are expected to keep pace over the next 18 months, with a half-dozen new North American fabs planned by the end of next year.
Fabs such as the new Globalfoundries facility in Singapore that will produce 300-mm wafers account for most of the new capacity, SEMI said. No less than 15 300-mm lines are under construction, with seven more planned in 2022. SEMI said those seven will consist of a mix of 200-, 150- and 100-mm production lines geared toward meeting unrelenting demand of automotive, 5G and Internet of Things components.
Fifteen of the 29 new fabs projected by SEMI will produce upwards of 30,000 wafers monthly. A key driver is the memory sector, that will account for at least four dedicated fabs over the next 18 months. Once up and running, those facilities could be producing as many as 400,00 wafers per month, the industry group estimates.
While foundry construction is well underway, SEMI cautioned this week that it does not expect chip makers to begin installing lithography and other equipment until 2023 “since it takes up to two years after ground is broken to reach that phase.”
Still, some chip makers may begin installing IC equipment as early as next year, the industry group added.
Which acknowledges a key point: Despite all the recent talk about reviving U.S. chip manufacturing and building resilient technology supply chains, it will take a while to ramp up semiconductor production. A major focus, observers note, is how much capacity TSMC and Intel bring online in the U.S., particularly hoped-for expansion in Arizona.
If and when that U.S. capacity comes online, SEMI said the IC equipment sector heavily focused on North America and Europe suppliers is bound to prosper for the foreseeable future.