Week In Review: Manufacturing, Test

Government policy
The U.S. government hopes to build more fabs and expand its R&D efforts in the United States. To help enable those efforts, U.S. Senate Majority Leader Charles Schumer has introduced the new bipartisan U.S. Innovation and Competition Act. This combines Schumer’s Endless Frontier Act and other bipartisan competitiveness bills. It includes $52 billion in emergency supplemental appropriations to implement semiconductor-related manufacturing and R&D programs. The bill needs to pass Congress before it is enacted.

Not all are happy with the plan. Bernie Sanders (I-VT) supports expanding the production of chips in the U.S., but he doesn’t support “over $50 billion in corporate welfare to large, profitable corporations with no strings attached.” See video here.

On top of that, U.S. chip subsidy efforts face pushbacks over China issues.

Chipmakers and OEMs
Recently, Intel, Samsung, TSMC, UMC and others announced major capital expansion plans. But not all chips require leading-edge processes. In fact, there is a huge demand for chips based on specialty processes.

For example, Bosch is ramping up a new 300mm fab in Dresden, Germany. The fab will produce ASICs and power semiconductors. The company broke ground on the fab in 2018. Production runs started in January of 2021 with full-scale production slated for July 2021.

Then, Sony Semiconductor has begun operations on the production lines at a new fab built on the premises of Nagasaki Technology Center. The new fab, called Fab 5, will be utilized for the mass production of CMOS image sensors.

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IBM and The Grainger College of Engineering at the University of Illinois Urbana-Champaign (UIUC) plan to launch a collaboration designed to increase access to technology education and skill development. This collaboration will involve the creation of the new IBM-Illinois Discovery Accelerator Institute, housed within The Grainger College of Engineering. It will be funded by a ten-year planned research investment from IBM and UIUC, complemented by a major new building project which will house research activities in quantum information, high-performance computing, hybrid cloud and networked environments. The State of Illinois will help fund the project, bringing total investments to more than $200 million.

NASA will initiate a new competition for the 2021-22 school year, providing student teams a chance to design, build, and launch experiments on suborbital rockets and high-altitude balloon flights. The NASA TechRise Student Challenge will begin accepting entries in August. Teams of sixth- to 12th-grade students can submit ideas for climate or remote sensing experiments to fly on a high-altitude balloon, and space exploration experiments to fly aboard a suborbital rocket.

Fab tools
TEL has announced some changes within its organization. As part of the changes, TEL has formed the new Corporate Production Division.

CyberOptics has received an order valued at approximately $1.3 million for a new customer adopting its SQ3000 Multi-Function systems for miniLED inspection and metrology. Revenue from the order is expected to be recognized in the second half of 2021.

Packaging and test
Advantest has disclosed its second mid-term management plan. In the plan, the company disclosed its sales targets and trends in the ATE business.

Keysight Technologies has acquired Quantum Benchmark, a supplier of error diagnostics, error suppression and performance validation software for quantum computing.

In a blog, Brewer Science discusses the field of advanced packaging, namely wafer-level packaging.

Market research
IC Insights has released its rankings for the top-25 semiconductor suppliers in the first quarter in terms of sales. Intel remains first on the list, followed by Samsung, TSMC, SK Hynix and Micron. There were two new entrants into the top-15 ranking in 1Q21—MediaTek and AMD. MediaTek and AMD replaced HiSilicon and Sony in the top-15 listing.

In total, semiconductor equipment sales are expected to surge 31% in 2021, reaching over $120 billion, according to VLSI Research. “The big uptick is driven by extraordinary IC shortages and higher than anticipated semiconductor demand,” according to the firm. “Equipment sales are expected to grow at a CAGR of 5% in the next five years, hitting $151 billion in 2026. Semiconductor industry is in an unprecedented upcycle that will likely continue a number of years fueled by strong secular drivers (digital transformation of the economy, AI, 5G) and also by government subsidies globally.”

Semiconductor manufacturers worldwide are on track to boost 200mm fab capacity by 950,000 wafers, or 17%, from 2020 through 2024 to reach a record high of 6.6 million wafers per month, according to SEMI. 200mm fab equipment spending is expected to reach nearly $4 billion in 2021 after passing the $3 billion mark in 2020, according to SEMI.

North America-based semiconductor equipment manufacturers posted $3.41 billion in billings worldwide in April 2021, according to SEMI. The billings figure is 4.1% higher than final March 2021 billings of $3.27 billion and 49.5% higher than April 2020 billings of $2.28 billion. “April billings of North America-based semiconductor equipment marked the fifth consecutive month of record growth,” said Ajit Manocha, SEMI president and CEO. “Equipment manufacturers continue to log steady growth as the industry works to meet accelerating demand for semiconductors across a wide range of end-market segments.”

There are mixed signals in the smartphone market. Investment banking firm Cowen has lowered its 2021 smartphone unit forecast from 7% to 5% year-over-year growth. “Our May field work that suggests builds at Samsung and OVX (Oppo, Vivo and Xiaomi) have declined for C2Q. Ongoing component supply tightness remains a risk for all,” according to Krish Sankar, an analyst at Cowen. In total, smartphone vendors are expected to ship 1.45 billion units in 2021 with 5G systems representing 450 million units, according to Cowen.

IDC has raised its near-term outlook for the global smartphone market. Shipments of smartphones are forecast to reach 1.38 billion units in 2021, an increase of 7.7% over 2020, according to IDC. This trend is expected to continue into 2022, when year-over-year growth will be 3.8% with shipments totaling 1.43 billion. Meanwhile, shipments of PCs are expected to grow 18.1% in 2021 with shipments of just over 357 million units, according to IDC. IDC still expects PC growth to drop slightly in 2022 at minus 2.9%.