By DAVE LAMMERS, Contributing Editor
Charles Dickens begins his novel A Tale of Two Cities, about London and Paris during the French Revolution: “It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness….it was the season of Light, it was the season of Darkness…”
The worldwide semiconductor industry is in a similar state, with revenues forecast at ~$530 billion this year and fab investments hitting a “best of times” $140 billion. Speaking at the virtual Advanced Semiconductor Manufacturing Conference (ASMC) 2021, SEMI senior principal analyst for semiconductors Christian Dieseldorff noted that it took industry 13 years to grow revenues from $200B to $300 billion, but only four years to reach the $400 billion milestone, and a scant four years more to reach the $500 billion level (FIGURE 1).
“Everyone is rushing to increase capacity, so much so that OEMs cannot keep up with demand for tool deliveries, leading to a slight chance some of these investments will be pushed into next year,” he said.
However, the industry’s strong growth is marked by painful component shortages for a wide range of key industries, and a “worst of times” level of international tensions — largely involving China, Taiwan, and the United States — which ASMC keynote speaker Robert Maire described as a standoff state of “mutually assured destruction.” The U.S. equipment export restrictions to SMIC and others are almost sure to result in retaliation from China, putting the kibosh on the proposed ARM acquisition by NVIDIA. Both the United Kingdom and China are likely to withhold approval of the merger, with Maire adding that disapproval of the mega-deal is likely to find favor with companies such as Intel and AMD.
Meanwhile, Washington is considering how to fund the CHIPS for America Act, approved by Congress but with funding for the incentives still being hammered out. A separate SEMI seminar, sponsored by the Arizona and Texas local SEMI chapters, featured industry and elected representatives discussing the CHIPS legislation and the need to “create a level playing field” with Asian nations, which one speaker said support up to half the cost of new fab construction with subsidies and tax benefits.