SEMICONDUCTOR INDUSTRY

UPDATE

January 2018

McIlvaine Company

 

TABLE OF CONTENTS

 

EVG Completes Latest Phase of Production Capacity Expansion

Samsung’s Semiconductor Business Braces for Fiercer Competition In 2018

Epileds Poised to Start Production at New Plant

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EVG Completes Latest Phase of Production Capacity Expansion

EV Group (EVG), a supplier of wafer bonding and lithography equipment for the MEMS, nanotechnology and semiconductor markets, announced that it has completed construction and opened a new building at its corporate headquarters in Austria to expand capacity for producing its industry-leading process equipment. The building, part of an investment of more than 20 million Euros that was announced earlier this year, allows for a significant expansion of warehouse space and provides more than 50 percent additional test room space for the final assembly of EVG’s high-precision systems, as well as technical source inspection of the systems by its customers.

“EVG operates in highly dynamic markets, where we always strive to provide our customers with the latest technologies to realize their product ideas with the shortest possible time to market–true to EVG’s Triple-i philosophy of invent-innovate-implement,” stated Dr. Werner Thallner, executive operations and financial director at EV Group. “Our headquarters expansion helps ensure that we continue to deliver on this pledge to our customers. I’m pleased to say that we completed this expansion in record time too, and we already have plans for additional capacity expansion in preparation for future growth.”

The completed building at EV Group’s headquarters is part of an investment of more than 20 million Euros to expand the company’s production capacity.

The new test rooms, which are designed to house larger systems including high-volume manufacturing platforms and solutions for panel-sized substrates, are equipped with the latest air conditioning and cleanroom technology. The ambient conditions created through these measures are similar to those found in the semiconductor fabs or bio-medical labs of EVG’s global customers. The sophisticated security concept at EVG’s headquarters, which extends to the new building complex, enables customers to have controlled access to individual test rooms where the technical source inspection of their tools can take place together with EVG specialists.

Several EVG systems have already been moved to the new facility for final assembly, software installation and initial set-up in order to make more room available for fulfilling additional system orders.

 

Samsung’s Semiconductor Business Braces for Fiercer Competition In 2018

Kim Ki-nam, chief executive officer of Samsung Electronics’ semiconductor business, is bracing for fiercer competition in the global market for chips this year -- a critical time for the industry’s growth. Cautiously forecasting the chip industry for the next 12 months, Kim said in a short New Year’s message to local media that the industry is in a grave situation, hinting at difficulties in innovating technologies and concerns about a looming oversupply. “Amid an unprecedented boom, the semiconductor industry is facing a stark reality,” Kim said. “Due to rapidly changing technologies, it is very difficult to predict how the industry landscape will change.” Market researchers project that the global chip market will continue thriving this year, but the growth pace is expected to slow compared to last year. 

According to data, the world DRAM market expanded by 72 percent to $72.2 billion in 2017 from a year earlier, but it is estimated to be $84.4 billion this year, a 16.9 percent growth from last year. 

Samsung’s biggest profit source is dynamic random access memory. 

Predicting tightness in supply and demand of DRAM chips due to rising demand from data center businesses, Samsung is currently expanding its DRAM production by building a new fabrication line on the second floor of the cleanroom in its newest plant in Pyeongtaek, Gyeonggi Province. 

The new facility’s capacity is expected to be 60,000 wafers, about one-sixth of the company’s total DRAM production capacity, according to the industry. When the expansion plan was released in November, DRAM prices temporarily nosedived 21.4 percent in one week, due to oversupply worries.  

“We will make ceaseless efforts to innovate technologies and take challenges in order to keep the position of the world’s top chipmaker,” Kim said. 

Samsung plans to seek innovation in its flagship 3-D NAND flash memory by allocating 60 percent of its annual investment amount for NAND, according to the company’s conference call on its third quarter earnings. However, the NAND market is also predicted to see slower growth this year. The market grew 46.2 percent to $53.8 billion last year, while it is forecast to expand 10 percent to reach $59.2 billion this year. Industry observers say Samsung’s investment plan for this year might reshape the market by affecting supply and demand significantly. 

“The NAND market has already started slowing down, while the DRAM market is likely to be influenced by Samsung’s further investment,” said Song Myung-seob, an analyst. “Investors will need to pay more attention to the company’s upcoming investment announcement for this year.” 

According to another market researcher, Samsung invested a total of $26 billion last year, accounting for over 20 percent of total investments by global chipmakers. 

The institute estimated Samsung spent $14 billion on building facilities for 3-D NAND, while investing $7 billion and $5 billion in DRAM and foundry respectively. 

 

Epileds Poised to Start Production at New Plant

LED epitaxial wafer and chip maker Epileds Technologies is relocating production from a rented plant to another of its own in the Southern Taiwan Science Park, according to Chinese-language newspaper Economic Daily News. It is installing equipment at the new facility and the production lines there will gradually come into operation in first-half 2018.

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