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Chip makers' 2003 capex to buck downward trend

Buying more kit as customers buy more chips

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Semiconductor manufacturers are set to increase spending on chip-making equipment this year, reversing the downward trend witnessed over the last few years, market watcher Gartner claimed this week.

That, it reckons, is a sign of incipient recovery, with the industry starting to "emerge from its holding pattern and... to move forward again".

Gartner reckons worldwide semiconductor capex will total $29.9 billion this year, 7.9 per cent up on last year's figure, $27.7 million. In 2002, spending fell 37.9 per cent year on year. Spending is favouring 300mm wafer equipment.

"On a regional basis, Japanese companies are most aggressively raising spending this year with a possible increase of 25 percent to 30 percent over 2002, funding its newly restructured ventures," aid Klaus-Dieter Rinnen, managing VP for Gartner's semiconductor manufacturing and design research group, in a statement. "DRAM has been strong so far, led by Samsung's aggressive plans to increase spending by more than 50 per cent over last year. Foundry is the wild card. We expect foundry [spending] growth to be flat in 2003, but this can change in the blink of an eye."

The company's figures show an increase in worldwide wafer fab utilisation, rising to 81 per cent in Q2 across the board and 90 per cent for 180nm/0.18 micron process and under lines.

"In the second half of 2003, we anticipate utilisation rates to rise further," said Rinnen. "Overall utilisation should cross the 85 per cent mark during the second half of the year. Leading-edge utilisation [180nm or below] should end the year at a projected 95 per cent."

This year, worldwide foundry revenue will grow 23 per cent, Gartner forecasts, driven by rising wafer shipments on the back of growing chip demand, primarily in the consumer and PC sectors. Gartner said it expects a PC upgrade cycle to commence in the second half of the year, albeit a slow one. ®

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