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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: daryll40 who wrote (52370)	9/17/2001 3:24:56 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 70976

Delay of fab projects after 2002 could 'derail' IC recovery, warns report Semiconductor Business News (09/17/01 14:29 p.m. EST) EL SEGUNDO, Calif. -- The semiconductor industry faces "serious shortages" of select parts if chip makers do not jumpstart their delayed fab projects by next year, warned a report from iSuppli Corp. here today. Shortages of logic and other chips "could develop rapidly and derail the recovery of the entire electronics industry" if chip makers do not begin the construction of their delayed fabs by the middle of 2002, warned Len Jelinek, who tracks the industry for iSuppli of El Segundo, Calif. "Semiconductor integrated device manufacturers (IDM) plant utilization is hovering in the 70% range, and foundry utilization was just 40% last quarter as manufacturers ceased outsourcing wafer starts," Jelinek said. "And while it seems a bit fanciful to speak of allocation and component shortages in light of these conditions, our detailed analysis of the semiconductor supply chain has identified several choke points that could cause significant component shortages over the next several years," Jelinek said. "Specifically, consolidations, facility shutdowns and delaying of announced expansion plans in light of current market conditions is creating the potential for serious supply shortages to develop in the not too distant future," he said. "To avoid this, manufacturers must restart these deferred programs by next summer to have the capacity on line to meet customer demand," he said. "This has truly been a tough year so far for the semiconductor industry," he noted. "But as order rates pick up over the next few quarters, it will be important for manufacturers not to color capacity expansion decisions with the pessimism of the recent past."