The SEMI Association expects that between 2025 and 2027 inclusive, chip manufacturers will spend $400 billion to equip factories using 300 mm silicon wafers. At the end of this year, costs for these purposes will increase by 4% to $99.3 billion, but next year they will immediately jump by 24% to $123.2 billion.
Image source: Micron Technology
According to SEMI, next year will be the first period in the history of the semiconductor industry that the cost of purchasing equipment for the production of chips will exceed the amount of $100 billion. In 2026, they will increase by another 11% to $136.2 billion, and by 2027 the growth rate will slow down. up to 3%, but this will still increase the amount to $140.8 billion. By industry sector, the main sources of growth in demand for chips will be artificial intelligence and machine learning, cloud computing and data centers, the automotive sector and the Internet of Things. The geopolitical factor will also have a stimulating effect – the pandemic has exposed the vulnerability of supply chains to the high concentration of production capacity in Asia, so other regions are now trying to develop their own semiconductor industry. Even the environmental factor is driving demand for new chip manufacturing equipment as companies try to comply with the green agenda.
Image source: SEMI
A significant part of the three-year costs of manufacturers for the purchase of equipment for the production of chips from 300-mm silicon wafers, namely $230 billion, will be in the contract manufacturing segment. The transition to more advanced technologies such as the same 3nm process technology will require a corresponding update of the equipment fleet. Along the way, new materials and components will be introduced, the production and processing of which also require new equipment. Research work in the advanced lithography segment will also require serious investment. At the same time, the need for chips produced using mature technical processes will grow, and equipment will also be purchased for these needs.
In the logic components segment, three-year costs for the purchase of equipment for chip production will reach $173 billion, according to SEMI forecasts. This will largely happen due to the rapid growth of server infrastructure necessary for the development of artificial intelligence systems. This area requires chips produced using advanced technical processes, so the cost of purchasing specialized equipment is quite high. At the same time, the infrastructure of 5G communication networks will develop, which also needs new chips. Endpoints also benefit from upgrading to more advanced processes that reduce power consumption.
The development of AI systems involuntarily stimulates the demand for memory, especially when it comes to HBM. In this area, $120 billion will be spent over the next three years to equip enterprises with new equipment. Advances in 3D NAND memory are making it possible to equip smartphones and data centers with larger data storage capacities.
Finally, in the field of power electronics production, investment in equipment will reach $30 billion in the next three years; analog and combined chips will require investments of up to $23 billion. Not least of all, this will happen due to the expansion of electric vehicles and the development of alternative energy in general. In addition, automation solutions are in demand in the manufacturing sector.
In the regional context, the largest buyer of equipment for the production of chips from 300 mm silicon wafers until 2027 will remain China, which will spend more than $100 billion on these needs. This year alone, $45 billion will be spent on these purposes, and in 2027 their amount will be limited to $31 billion
The concentration of memory production in South Korea will force this country to spend $81 billion on related needs. The largest contract chip manufacturers are located in Taiwan, and this island is going to spend $75 billion on the purchase of equipment for chip production over three years, although part of these funds will be spent on supplying equipment to foreign enterprises of the same TSMC. Finally, both Americas will limit their spending to $63 billion, with a predictable bias in favor of the United States. Japan, Europe, the countries of the Middle East and Southeast Asia will limit themselves to more modest amounts.