Shortages loom after 8-inch fabs run at 99% capacity in Q1
(06/02/00, 01:54:41 PM EDT)
semibiznews.com
SAN JOSE -- That loud choking sound coming from the semiconductor industry is the result of a tight squeeze on production capacity becoming much tighter this summer.
Worldwide 8-inch wafer fabs, producing mainstream metal-oxide semiconductors, were operating at an astonishing 99% of their capacity at the end of the first quarter, according to the latest industry data. Industry analysts are now warning that a severe shortage of production capacity will likely hit the industry in the next couple of months.
"That number [99% capacity utilization] really jumps out, but the other number that jumped out at me was the increase in wafer starts with process less than 0.3-micron [feature sizes]," said analyst Bill McClean, president of IC Insights Inc. in Scottsdale, Ariz.
McClean was referring to the new Semiconductor International Capacity Statistics (known as SICAS), which show wafer starts for 0.3-micron and below processes at 566,200 six-inch equivalent wafers in the first quarter. That level of production was a 22.3% increase from the fourth quarter of 1999, when semiconductor fabs were producing leading-edge ICs at a run rate of 462,800 six-inch equivalent wafers per week. In the third quarter of 1999, fabs were producing 358,300 six-inch equivalent wafers (with 0.3-micron and below processes).
"The less-than-0.3 micron capacity jumped 100,000 wafers a week in the first quarter compared to the fourth quarter, which was more than 100,000 higher than the third quarter," McClean observed. "The first quarter capacity for processes less than 0.3 micron was almost double what it was in the same period last year."
McClean believes the fast ramp of 0.3-micron and below processes was possible partly because of an oversupply of empty and available fab space from the last downturn. But now the industry has "pretty much filled out all of the existing space, and there's not a lot of room left [for rapid expansion]," warned the veteran chip analyst. Consequently, he and other analysts expect average selling prices to begin to rise in the third quarter as shortages of ICs spread.
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The report said MOS fabs with 8-inch wafer diameters were nearly tapped out at 99% capacity utilization--the highest on record, according to many long-time observers. In the first quarter of 1999, capacity utilization of 8-inch MOS fabs was at 92.7%, and at the low point in the last downturn (third quarter 1998) it was at 86.9%, according to the SICAS report. |
