* 2010 spending expected at roughly $30 billion
* Projected peak at $43 billion in 2012
By Ian Sherr
SAN FRANCISCO, March 8 Global chip equipment
spending should grow by more than three-quarters in 2010, but
companies will focus on upgrades and efficiency, keeping
investment in capacity shy of pre-recession levels, two
industry trackers said.
Investment in chip manufacturing equipment is expected to
reach roughly $30 billion this year, up more than 75 percent
from a year ago, but still off the peak of about $45 billion
seen before 2007, Gartner said on Monday.
Another study released by the SEMI trade group, which
comprises the world's leading makers of machines used to make
microchips, estimated growth in chip gear spending could hit as
much as 88 percent.
"The semiconductor equipment industry will experience a
very strong growth spurt in 2010, as we emerge from a very
costly recession, and this growth is expected to continue
throughout 2012," said Jim Walker, research vice president at
"However, we expect this upturn to be one of the first in
which the peak revenue in capital equipment does not surpass
previous growth cycles, which may well help to mitigate the
boom/bust scenario that we have seen in the past."
The renewed focus comes after a costly round of capacity
investments spurred by the explosion of personal computers in
the 1990s and the dot-coms of the past decade, said Klaus
Rinnen, co-author of the Gartner report.
The focus has turned to inventory control and eking more
products from existing manufacturing plants, he said.
"It pays back to upgrade," Rinnen said, adding that
enhancing existing fabs, or production centers, with better
manufacturing processes can cost less than a quarter of the
price of a new one.
"Let's get more out of these fabs and let's keep them for
longer and upgrade them more rapidly and buy them more smartly
so that we can get more out of it for lower cost," he said.
As a result, Gartner said it expects spending to peak in
2012 at roughly $43 billion.
"It doesn't mean we don't build at all, it's just less
building," Rinnen added.
The world's top chip equipment makers include Applied
Materials (AMAT.O), ASML (ASML.AS) and Tokyo Electron (8035.T).
Top chip manufacturers include Intel Corp (INTC.O), TSMC
(2330.TW) and privately held GlobalFoundries.
(Reporting by Ian Sherr. Editing by Robert MacMillan)