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Pastimes : Clown-Free Zone... sorry, no clowns allowed
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To: LLCF who wrote (151219)2/14/2002 2:12:27 PM
From: orkrious  Read Replies (2) of 436258
 
No, when INTC plans new chip, AMAT gets equipment orders before INTC can make the chip no?

Actually, that is not correct. With many fabs operating at 50% of capacity, they must be convinced a pickup is for real before they add capacity. It is true that many companies will want the latest equipment to help keep their costs down, but as a general rule the equipment companies don't lead the upturns. It's a fallacy perpetuated by a couple of people that sound good.

Almost no one orders new equipment with capacity utilization low. What good is new equipment when you're operating at low capacity. And at low capacity, you have no sales. Where does the money come to pay for new equipment? There are often head fakes of business picking up, such as now.

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