The production value of the nation’s semiconductor industry is expected to grow 16.7 percent this year from last year, outpacing the global industry’s 3.3 percent growth, industry association SEMI said yesterday.
That would help Taiwan safeguard its second spot in the global semiconductor market with a production value of more than NT$3 trillion (US$102.73 billion), SEMI Taiwan president Terry Tsao (曹世綸) told a media briefing in Taipei for the Semicon Taiwan trade show beginning today.
The global semiconductor industry’s production value is expected to increase to US$426 billion this year, SEMI said.
In terms of semiconductor equipment investment, equipment billings from Taiwanese firms rose 10.6 percent to US$8.63 billion during the first seven months of this year, ranking third in the world, SEMI’s tally showed.
China was the largest semiconductor equipment market with investment of US$9.84 billion during the January-to-July period, surging 45.2 percent from a year earlier, data showed.
South Korea came next with semiconductor equipment investment soaring 54.1 percent to US$9.49 billion.
“The COVID-19 pandemic does not slow down the global semiconductor industry’s investment in manufacturing equipment,” Clark Tseng (曾瑞榆), director of the industry research and statistics unit of SEMI Taiwan, told reporters.
North America-based manufacturers of semiconductor equipment last month posted US$2.6 billion in worldwide billings, up 32.5 percent annually, after hitting the highest level in about two years in July, Tseng said.
The global semiconductor equipment market is to climb to US$65 billion this year and rise further to US$70 billion next year, SEMI said.
The forecast did not take into account the US’ export restrictions on Huawei Technologies Co (華為) and potential sanctions against China’s biggest chipmaker, Semiconductor Manufacturing International Corp (SMIC, 中芯).
The US-China trade dispute would pose a greater threat to semiconductor supply chains over next two to three years if SMIC and other Chinese companies were to be placed on the US’ entity list restricting US semiconductor equipment suppliers from selling equipment to Chinese companies, Tseng said.
SMIC accounted for 30 percent of China’s semiconductor equipment market, he said.
The company has spent an average of US$3 billion to US$5 billion a year on new equipment over the past few years, he added.
The Chinese chipmaker has revised up its capital spending for a second time to more than US$6.7 billion this year to buy as much equipment as possible before being blacklisted by the US, Tseng said.
Tseng’s comments echoed those of ASE Technology Holding Co (ASE, 日月光投資控股) chief operating officer Tien Wu (吳田玉), who also spoke at the media briefing.
Wu said that rising protectionism, “parallel universes” and remote connections are three major challenges awaiting the global semiconductor industry in the post-COVID-19 era.
“Parallel universes” means that the world has divided into two camps that do not communicate with each other and differ in regulation, Wu said, implying that the world is divided into Chinese and US camps with different regulations, manufacturing materials and design systems.
Commenting on rebuilding the global semiconductor supply chain amid the US-China trade dispute, Wu said that it takes time for corporate executives to come up optimal decisions, given greater uncertainty of the external environment.
ASE and its semiconductor peers have the ambition to reshape the supply chain, he said.
MOMENTUM: While next-generation smartphones feature more semiconductors and vendors increase their inventory, the chipmaker remains focused on production in Taiwan Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the sole chip supplier for Apple Inc’s iPhone series, yesterday raised its revenue forecast again, saying that robust demand for 5G smartphones and high-performance-computing (HPC) would help boost revenue this year by 30 percent in US dollar terms. Three months ago, the chipmaker estimated that revenue would grow 20 percent this year from last year, reaching its long-term growth target of 15 to 20 percent annually. “Moving into the fourth quarter, we expect our growth in revenue to be supported by strong demand for our industry-leading 5-nanometer technology driven by 5G smartphone launches and HPC-related applications,”
WIN-WIN SITUATION: Customers, products and client portfolios of the companies are complementary, allowing for inroads into new fields, Chipbond’s chairman said Chipbond Technology Corp (頎邦) yesterday said it plans to acquire about a 31 percent stake in Orient Semiconductor Electronics Ltd (華泰電子) in a cash-and-share deal, aiming to make inroads into flash memory-chip packaging. Chipbond said the strategic alliance would open the door for the company to enter the flash memorychip packaging and testing market, which is a new business for the Hsinchu-based company. Chipbond primarily provides testing and packaging services for driver integrated circuits that are used in flat panels. BUSINESS OPPORTUNITY “Except for flash memory chips, we also saw a lot of new businesses that require the technologies of Chipbond or Oriental
India’s COVID-19 economic gloom turned into despair this week, on news that its per capita GDP for this year might be lower than that of Bangladesh. “Any emerging economy doing well is good news,” Kaushik Basu, a former World Bank chief economist, said on Twitter after the IMF updated its World Economic Outlook. “But it’s shocking that India, which had a lead of 25% five years ago, is now trailing.” Ever since it began opening up the economy in the 1990s, India’s dream has been to emulate China’s rapid expansion. After three decades of persevering with that campaign, slipping behind Bangladesh hurts
BROADER STANCE: While growth in its core consumer electronics assembly business is decreasing, the manufacturing giant aims at a 10 percent gross margin Hon Hai Precision Industry Co (鴻海精密) said it aims to secure a 10 percent share of the world’s electric vehicle market by 2025, with about 3 million vehicles potentially using its platform. The electronics giant yesterday unveiled the plan to expand its nascent automobile business, saying that it seeks to offset slowing growth in its core consumer electronics assembly business. The company also outlined plans to release a solid-state battery by 2024 that could potentially displace the more commonly used lithium-ion batteries in electric vehicles. Hon Hai plans to achieve its ambitious target by making its software and hardware platforms “open,” Hon Hai