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SIA admits 2001 chip growth forecast won't be met

Up 22 per cent? Not likely...

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The Semiconductor Industry Association has cut its annual growth projections, claiming that its original outlook for 2001 - specifically, growth if 22 per cent - almost certainly won't be achieved.

Global sales during December 2000 reached $17.9 billion, an increase of 21.6 per cent over the $14.70 billion recorded the year before. However, that marks a 2.1 per cent drop on November 2000's sales of $18.28 billion (a 28.4 per cent increase on November 1999).

So, month on month, sales are down as is year-on-year growth.

Of course, the clever old SIA expects this, noting that December's dip is in line with "normal year-end patterns". Indeed, when the trade body made its annual 2001 growth rate prediction of 22 per cent, it said Q1 growth would only hit 17 per cent, thanks to the "inventory overhang going into 2001".

Now, however, it's looking like that "inventory overhang" will protrude further than expected, to the extent that it will hurt 2001's overall figure even more.

The new, more pessimistic outlook - the SIA has yet to put a figure on the decline - is in tune with other industry predictions. Last month, Motorola said it reckons growth won't exceed ten per cent.

That's well down on the 37 per cent the industry achieved during 2000, according to figures from the SIA and, separately, Dataquest.

That growth was experienced most strongly in the Far East, with chip sales to Japan increasing 42.4 per cent and Asia Pacific 37.9 per cent year on year. Sales to the Americas grew 34.9 per cent; Europe grew 32.7 per cent.

Processors experienced the highest sales - $31.9 billion - but the lowest growth during 2000: just 17.2 per cent. The biggest growing sector was Flash RAM, which saw sales of $10.6 billion, up 133.2 per cent. The DRAM market grew 39.5 per cent to $28.9 billion. ®

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