SEMI forecasts 2011 Southeast Asia to increase fab spending to 43.8 percent

SINGAPORE: 2010 was a record year for Singapore's semiconductor industry and the strong growing trend is continuing through 2011. At SEMICON Singapore 2011— the annual exhibition that connects Southeast Asia’s semiconductor industry kicks off at Suntec Singapore. SEMI forecasts the fab spending in Southeast Asia to grow 43.8 percent year-on-year.

Industry forecast for semiconductor revenue growth for 2011 is expected to reach a range of 5 percent to 10 percent. With positive demand in the electronics sector, especially for mobile devices, SEMI expects the semiconductor industry to keep continued growth.Source: SEMI.

Terry Tsao, president of SEMI Southeast Asia said: “In Southeast Asia, we are looking at almost 17 percent growth in fab capacity this year which surpasses the global growth at 9 percent. This includes over 28 percent increase in installed 300mm fab capacity.”

The global semiconductor equipment spending in 2011 is expected to increase by 16 percent with current estimation of 3 percent increase for 2012. At 16 percent growth, 2011 would see the second highest level in equipment spending for the semiconductor industry, second only to the $48 billion spent in 2000.

In the Southeast Asia region, total semiconductor equipment spending is expected to reach $4.3 billion and $4.9 billion in 2011 and 2012, respectively. For 2011, about $2.6 billion to $2.8 billion will be spent on fab equipment, $900 million for test equipment, and $600 million on packaging equipment. In addition, the total semiconductor materials spending in Southeast Asia will reach $7.5 billion and $7.7 billion in 2011 and 2012, respectively. Packaging materials account for $5.8 billion of the spending this year, with fab materials spending forecasted to reach $1.7 billion.

The positive outlook of the industry reflects on the growth of SEMICON Singapore. This year, more than 145 companies across 14 countries are exhibiting at SEMICON Singapore. More than 6,000 visitors are expected to gather at this three-day exhibition and conference to learn the market trends and updates.

“Most experts, including those presenting during this SEMICON Singapore event, expect 2011 to be another strong year for semiconductors. Utilization rates for leading technologies remain high and equipment purchases have returned to levels last seen in 2007. I anticipate rather solid performance in Asia,” said David Wilhoit, President and CEO of Slitronic Samsung Wafer.

Singapore remains the second largest city of semiconductor output and manufacturing hub in Asia. Leveraging this favorable environment, many global semiconductor companies have chosen to locate their Asian headquarter in Singapore with IM Flash Technologies opening its $3 billion facility most recently in April. Foundries such as GLOBALFOUNDRIES and SSMC also announced new investments and accelerated their hiring.Source: SEMI.

Wilhoit added: “Approximately two-thirds of all 300mm wafers are consumed in Asia Pacific region, which makes Singapore an important base for us to support our customers.” Strong government support and a high-quality workforce are considered as the essential attraction for global companies to locate in Singapore.

“The local government interacts closely with the industry to create a supportive manufacturing environment which includes developing the highly motivated and educated workforce. Currently, 87 percent of our indirect labor is staffed with Singaporeans/PRs.”Source: SEMI.

Rodney Morgan, co-executive officer of IM Flash Technologies, who also serves as the chairman of SEMI’s Singapore Regional Advisory Board (RAB), stated that Singapore provides a great deal of opportunity, but it needs to focus on raising the visibility of the semiconductor industry through workforce development and awareness management.

“SEMI is working hard with the semiconductor industry ecosystem in Singapore to take the Singapore semiconductor industry to the next level,” said Tsao. Singapore remains an important base of semiconductor packaging & testing. Last month, IME just announced the IME-AMAT Center of Excellence in Advance Packaging.

"Singapore's manufacturing sector is positioned for higher economic growth with advanced packaging manufacturing capabilities such as through-silicon via (TSV) and wafer level packaging (WLP), technologies that enable higher performance and functionality in 3D-IC and MEMS applications. – This is an emerging trend that will continue to develop globally. In addition, Singapore continues to contribute significantly in these technology developments given the strong and established semiconductor R&D capabilities," said Prof. Dim-Lee Kwong, executive officer of IME.

A COO Series Forum is conducted on the first day of SEMICON Singapore gathering speakers from AMAT, ASML, IM Flash Technologies, Infineon, KLA-Tencor, Lantiq and UMC to discuss the issue of raising manufacturing efficiency and productivity, while driving down the costs.

“SEMICON Singapore is more than an exposition, it is the platform that connects our ecosystem, set benchmarks for driving manufacturing efficiency, and nurture more high-quality workforce for the industry,” said Tsao. There are five technical forums held at the show covering market trends, COO Series, MEMS, Advanced Packaging, Product Test Engineering and solar/PV & LED.