Chip-making kit spending slides

Taiwan cuts spend 44.5 per cent, US 15.7 per cent

Nothing says quite so much about the state of the semiconductor industry - or at least the outlook for the immediate future - as the money manufacturers spend on chip-making kit.

No surprise, then, that spending on equipment was way down during the first three months, according to the latest data from Semiconductor Equipment and Materials International.

Worldwide, spending on chip production equipment was down 12.7 per cent, falling from $12.88 billion in Q4 2000 to $11.25 billion in Q1 2001.

Taiwan suffered the chilliest cold feet, with the island's chip makers cutting spending a massive 44.5 per cent. In the last quarter of 2000, they spent $2.04 billion on new chip kit - for the first quarter of this year they spent just $1.13 billion. That's well down on the $2.3 billion they spent during Q1 2000.

North American manufacturers cut their spending significantly, too. Q1 2001 spending totalled $2.97 billion, down 15.7 per cent from $3.9 billion in Q4 2000, but well on the year-ago quarter's $2.36 billion. So even if growth isn't as high as anticipated, US and Canadian chip makers are still buying more kit.

That's also true of their European counterparts, whose year-on-year rise in spending totalled 13.6 per cent, up to $1.58 billion from $1.39 billion. In Q4 2000, spending reached $1.87 billion, making for a quarter-on-quarter fall of 15.7 per cent.

Some territories continued to increase their spending, year-on-year and quarter-on-quarter. Japan, for instance, spent $3.37 billion during Q1, compared to $2.18 billion (Q1 2001) and $2.56 billion (Q4 2000), for increases of 54.8 per cent and 31.7 per cent, respectively. ®

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