IC Insights expects the semiconductor market to grow ten per cent this year and does not expect any downturn until 2013. Future Horizons expects 9% growth but adds, it could be more.
"Most people expect single digit growth but we’re forecasting double digit growth," Bill McClean, CEO of IC Insights, told the ISS-SEMI conference in Grenoble this afternoon.
"We're forecasting 9% growth but it could very easily go to double digits," Malcolm Penn, CEO of Future Horizons told the conference, adding "we think 2012 will be a very strong year."
"2013 is the next downturn," added McClean, explaining: "capex is still only 16/17% of sales and we expect it to stay in that range for some time."
That’s because of the time-lag from ordering equipment to getting wafers out, explained Penn, from spending a capex dollar it takes at least a year to get a return in the shape of output..
"Last year we doubled the capex and only had 6% more wafer starts," said McClean.
So we haven't yet seen the effect of last year's sharp increase in fab manufacturing equipment buying.
STMicroelectronics is to spend more of its manufacturing capex in Europe, Alain Astier, vice president for front end technology and manufacturing group at ST, told the ISS-SEMI conference in Grenoble this morning.
"Manufacturing is weak in Europe, but in the last two years it has been recovering," said Astier, "Europe is investing in manufacturing: Intel is investing in Ireland, Globalfoundries is investing in Dresden, ST is investing $500m a year in Europe."
Asked by EW if ST CFO Carlo Ferro’s long-term strategy of gradually reducing capex as a proportion of sales had changed, Astier replied: "The strategy has not changed. We have shown we can be cost-competitive in Europe and there has been a decision to invest much more in Europe."
Asked if Europe benefited from having manufacturing, Astier pointed to the ‘strong correlation’ of R&D to manufacturing, arguing that R&D follows manufacturing, and to have a strong microelectronics sector required the full ecosystem from R&D to design to manufacturing.
ST has a university, said Astier, which teaches manufacturing science.