Following The Yen

An examination of the installed fab capacity base in Japan shows that total capacity expansion has stalled in recent years due to the consolidation and closures of facilities. The closure and consolidation of 27 facilities between 2009 and 2012 reduced the installed fab capacity in Japan by at least 350,000 200mm equivalent wafers per month. With that said, investments continued in some industry segments, and from 2010 to 2012 total front-end equipment spending totaled $11.3 billion in Japan (and total equipment, including packaging and test equipment, spending reached $13.7 billion over that same three years).

As noted in the August SEMI Global Update (www.semi.org/en/node/46496), Flash Alliance, the joint-venture between Toshiba and Sandisk, has the largest ongoing investment activity in Japan. Flash capacity in Japan grew by 14% in 2011, although it leveled off to 4% growth in 2012 and is estimated to increase by the same rate this year. A boost in the Flash Alliance investment will result in a forecast 7% expansion in Flash capacity for 2014.

While on a much smaller scale in terms of wafer size, LED epi fab capacity in Japan continues to multiply. The above graph shows the growth of LED epi fab capacity, and while the rate of capacity expansion is slowing, LED epi capacity is expect to expand 20% in 2013 and 16% in 2014. Nicha Corp. is leading the LED investment activity in Japan, followed by Toyoda Gosei, Show Denko, and Toshiba. More information will be available at SEMICON Japan 2013 (Dec. 4-6).

Device manufacturers in Japan also are active in the MEMS and sensor markets. Early on in 2013, Hamamatsu Photonics K.K. announced a 13.5 billion yen plan for the fiscal year that included its MEMS business. In April, it announced the construction of a new facility for the development and mass production of MOEMS-based opto-semiconductor devices and modules at its Solid State Division, targeting automotive, smartphone and other applications.

In June, Seiko Epson issued a release about its 16 billion yen investment for two new production lines in Japan to “manufacture next-generation print heads for use in business and industrial printing systems to come to market in the latter part of the 2013 fiscal year.” The investment began in fiscal 2011, and the new lines will be at the Epson Suwa-Minami Plant in Nagano Prefecture and at its Sakata Plant in Yamagata Prefecture. Front-end manufacturing will be at the Suwa-Minami plant and back-end processes at the Sakata plant.

To support the above investments, equipment spending is expected to increase in Japan in 2013 and again in 2014. These investments will result in the production of next-generation Flash, new MEMS, and advanced LED devices by Japanese semiconductor manufacturers. Learn more at SEMICON Japan and register for free here.