One Japanese in house producer of wafers folded, but the capacity was picked up by SEH. I think that the wafer start could increase by 30% or more to eat into the excess capacity, but there have not been any new wafer facilities put on line in more then a year, I believe. If indeed wafer starts start to pick up, then tightness will develop rapidly, and with it pricing power, IMHO. Because of the drastic decline in ASP in the last two years, one would need at least 50% increase in wafer starts (very rough estimates), to get back on the curve leading to $200 billions annual shipments of chips in two years, once again, a very rough estimate.
Zeev
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