Summary: The SEMI World Fab Forecast report projects a 6.4% increase in global semiconductor capacity in 2024, driven by investments in leading-edge logic and foundry applications, with China leading the expansion and the foundry segment expected to be the top equipment buyer.
- The projected 6.4% increase in global semiconductor capacity in 2024 will push the capacity past the 30 million wafers per month mark for the first time ever.
- The expansion is expected to be driven by increased capacity in leading-edge logic and foundry applications, such as generative AI and high-performance computing (HPC).
- The global attention on the strategic importance of semiconductor manufacturing to national and economic security has played a significant role in the resurgence of fab investments and capacity expansion.
In a new report released by SEMI, it has been projected that global semiconductor capacity will see a significant increase of 6.4% in 2024. This growth will push the capacity past the 30 million wafers per month (wpm) mark for the first time ever, following a 5.5% rise to 29.6 wpm in 2023. The expansion is expected to be driven by increased capacity in leading-edge logic and Foundry applications, such as generative AI and high-performance computing (HPC), as well as a recovery in the demand for chips.
The report highlights that the capacity expansion slowed down in 2023 due to a decrease in semiconductor market demand and subsequent inventory correction. However, with resurgent market demand and increased government incentives worldwide, there has been a resurgence in fab investments in key chipmaking regions. This has led to the projected 6.4% rise in global capacity for 2024, according to Ajit Manocha, SEMI President and CEO. Manocha also notes that the global attention on the strategic importance of semiconductor manufacturing to national and economic security has played a significant role in these trends.
Looking at the period from 2022 to 2024, the World Fab Forecast report reveals that the global semiconductor industry plans to begin operations of 82 new volume fabs. These include 11 projects in 2023 and a substantial increase to 42 projects in 2024. These projects will cover wafer sizes ranging from 300 mm to 100 mm.
China is expected to lead the expansion of the semiconductor industry, thanks to government funding and other incentives. Chinese chip manufacturers are forecasted to start operations of 18 projects in 2024, with a year-on-year capacity growth of 12% to reach 7.6 million wpm in 2023 and an additional 13% growth to reach 8.6 million wpm in 2024. Taiwan is projected to remain the second-largest region in terms of semiconductor capacity, with a capacity increase of 5.6% to reach 5.4 million wpm in 2023 and a further 4.2% growth to reach 5.7 million wpm in 2024. The region is also expected to begin operations of five fabs in 2024.
Korea ranks third in chip capacity, with 4.9 million wpm in 2023 and a slight increase to 5.1 million wpm in 2024, representing a 5.4% growth as one fab comes online. Japan is expected to secure the fourth position with 4.6 million wpm in 2023 and 4.7 million wpm in 2024, reflecting a capacity increase of 2% as it starts operations of four new fabs in 2024. The Americas will see a 6% year-on-year increase in chip capacity to reach 3.1 million wpm, with six new fabs scheduled for operation in 2024. Europe & Mideast is projected to increase capacity by 3.6% to reach 2.7 million wpm in 2024, as it launches operations of four new fabs. Meanwhile, Southeast Asia is expected to increase capacity by 4% to reach 1.7 million wpm in 2024, with the start of four new fab projects.
The report also highlights the continued strong growth in the foundry segment, with foundry suppliers predicted to be the top semiconductor equipment buyers. The capacity is expected to reach 9.3 million wpm in 2023 and set a new record at 10.2 million wpm in 2024. On the other hand, the memory segment experienced a slowdown in capacity expansion in 2023 due to weak demand in consumer electronics such as PCs and smartphones. The DRAM segment is expected to increase capacity by 2% to reach 3.8 million wpm in 2023 and a further 5% to reach 4 million wpm in 2024. The installed capacity for 3D NAND is projected to remain flat at 3.6 million in 2023 and experience a slight increase of 2% to reach 3.7 million wpm next year. In the discrete and analog segments, the key driver of capacity expansion remains vehicle electrification. Discrete capacity is forecasted to grow by 10% to reach 4.1 million wpm in 2023 and a further 7% to reach 4.4 million wpm in 2024, while analog capacity is projected to grow by 11% to reach 2.1 million wpm in 2023 and a further 10% to reach 2.4 million wpm in 2024.
The SEMI World Fab Forecast report, which was published in December, provides comprehensive information on 1,500 facilities and lines globally. This includes 177 volume facilities and lines with various probabilities expected to start operation in 2023 or later. For more details about SEMI reports on other semiconductor sectors, interested parties can visit SEMI Market Data or contact the SEMI Market Intelligence Team (MIT) at [email protected].
Foundry: A foundry is a dedicated manufacturing facility focused on producing semiconductor components like integrated circuits (ICs) for external clients. These foundries are pivotal in the semiconductor industry, providing diverse manufacturing processes and technologies to create chips based on designs from fabless semiconductor firms or other customers. This setup empowers companies to concentrate on innovative design without needing substantial investments in manufacturing infrastructure. Some well-known foundries include TSMC (Taiwan Semiconductor Manufacturing Company), Samsung Foundry, GlobalFoundries, and UMC (United Microelectronics Corporation).
NAND: NAND technology is a type of non-volatile memory that is used in many computer applications. It is a type of flash memory that is used to store data in a non-volatile manner, meaning that the data is not lost when the power is turned off. NAND technology is used in many computer applications, such as solid-state drives, USB flash drives, digital cameras, and memory cards. It is also used in many embedded systems, such as cell phones, tablets, and other consumer electronics. NAND technology is a reliable and cost-effective way to store data, making it a popular choice for many computer applications.
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