Record spending for fab equipment expected in 2017 and 2018, says SEMI

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KUALA LUMPUR (March 8): Fab equipment spending is expected to reach an industry all-time record - more than US$46 billion in 2017, according to the U.S. based Semiconductor Equipment and Materials International (SEMI).

In its World Fab Forecast report released yesterday, SEMI said the record is expected to be broken again in 2018, nearing the US$50 billion mark.

It said these record-busting years are part of three consecutive years of growth (2016, 2017 and 2018), which has not occurred since the mid-1990s.

The World Fab Forecast report (end of February 2017) provides updates to 282 facilities and lines equipping in 2017, 11 of which are expected to spend over US$1 billion each in 2017.

In 2018, SEMI’s data reflected 270 fabs to equip, with 12 facilities spending over US$1 billion each. 

The spending is mainly directed towards memory (3D NAND and DRAM), Foundry and MPU.  Other strong product segments are Discretes (with LED and Power), Logic, MEMS (with MEMS/RF), and Analog/Mixed Signal.

SEMI forecasts that China will be third for regional spending in 2017, although China’s annual growth is minimal in 2017 (about 1%), as many of the new fab projects are in the construction phase. 

It said China is busy constructing 14 new fabs in 2017 and these new fabs will be equipping in 2018.

“China’s annual spending growth rate in 2018 will be over 55% (more than US$10 billion), and ranking in second place for worldwide spending in 2018. 

“In total for 2017, China is equipping 48 fabs, with equipment spending of US$6.7 billion; looking ahead to 2018, SEMI predicts that 49 fabs to be equipped, with spending of about US$10 billion,” it said.

The SEMI World Fab Forecast indicates that Europe/Mideast and Korea are expected to make the largest leaps in terms of growth rates this year with 47% growth and 45% growth, respectively, year-over-year (y-o-y). 

Japan will increase spending by 28%, followed by the Americas with 21% y-o-y growth, it said.