Used semiconductor equipment market on the rise

As leading-edge digital memory and logic manufacturers build 300-mm fabs with 65-nm and smaller process technology, their 200-mm fabs with 130-nm and smaller technology are becoming obsolete, leaving them available for the analog, mixed-signal and RF chips.

By Ann Steffora Mutschler, Senior Editor -- Electronic News, 1/11/2008

Based on analysis of probable fab closures and fabs for sale, the used semiconductor equipment market will show tremendous growth in the next two year, growing from $300 million in 2007 to more than $8 billion in 2009, according to Phoenix-based research company Semiconductor Partners, part of Semico Research.

Morry Marshall, partner, strategic technologies, at Semiconductor Partners, explained that as leading-edge digital memory and logic manufacturers build 300-mm fabs for process technologies of 65 nm or less, their 200-mm fabs at 130 nm or 90 nm, and some of their 300-mm fabs at 90 nm will be obsolete.

Also, as a result of the growing analog, mixed-signal, and RF markets, analog and mixed-signal manufacturers will have a need for those fabs to meet demand. These factors combined are creating an opportunity for companies that finance, resell or refurbish used equipment, Marshall noted.

VLSI Research predicts equipment sales will fall 5% from $57 billion in 2007 to $54.15 billion in 2008. Equipment sales in 2007 were 7% higher than 2006. 

Gartner Inc expects worldwide semiconductor equipment spending to total $40.3 billion in 2008, a 9.9%decrease from 2007 spending of $44.8 billion, as the semiconductor industry overcomes the memory oversupply situation.

Klaus Rinnen, managing VP for Gartner’s semiconductor manufacturing group, reminded that 2007 was marked by continued strong DRAM investments, shrugging off the realities of a market sector in oversupply, slower NAND spending growth, and disappointed hopes of a foundry spending revival. 

“As we look to 2008, we expect the long overdue capital spending correction in the DRAM market to push the capital equipment market into contraction. Adding on the downside is another slow year from foundry and generally more cautious spending mood, with concerns about a U.S. economic recession rising,” Rinnen said.