The global COVID-19 pandemic, coupled with robust demand for next-generation electronics, has kept the capital equipment market humming. Last year, global sales of semiconductor manufacturing equipment surged 44% to an all-time record of $102.6 billion from $71.2 billion in 2020, according to data from SEMI, an industry association representing the global electronics product design and manufacturing supply chain.

The robust sales of semiconductor manufacturing equipment are not surprising, given that electronics manufacturers have been in a race to increase global manufacturing capacity to keep up with demand for semiconductors and other electronic components.  But because additional manufacturing capacity typically takes several years to bring online, the effects of the additional investments are often not felt immediately, which accounts for ongoing parts shortages.

"The 44% increase in manufacturing equipment spending in 2021 highlights the global semiconductor industry's aggressive push to add capacity," said Ajit Manocha, SEMI president and CEO, in a statement. "This drive to expand production capabilities extends beyond the current supply imbalance, as the industry continues to ramp up to address a wide range of emerging high-tech applications that will enable a smarter digital world with countless social benefits."

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China Paces Growth

According to SEMI, China was the largest market for semiconductor equipment for the second time, with sales expanding 58% to $29.6 billion to mark the fourth consecutive year of growth. Korea, the second-largest equipment market, saw sales soar 55% to $25.0 billion, after showing strong growth in 2020. 

Following China and Korea, Taiwan equipment sales grew 45% to $24.9 billion. Annual semiconductor equipment spending increased 23% in Europe and 17% in North America, which continues to recover from a contraction in 2020. Sales in the remainder of the world jumped 79% in 2021.

The survey found that global sales of wafer processing equipment rose 44% in 2021, while other front-end segment sales grew 22%. Assembly and packaging equipment increased 87% across all regions in 2021, while total test equipment sales rose 30%.

Annual Billings by Region (in Billions of U.S. Dollars)

Source: SEMI (www.semi.org) and SEAJ (www.seaj.or.jp), April 2022

200mm Fabs on the Rise

One ancillary trend has been the increased trend toward 200mm fabs, according to a separate SEMI report, 200mm Fab Outlook Report. The report concludes that manufacturers will increase global 200mm fab capacity by 1.2 million wafers, or 21%, between 2020 and 2024 to hit a record high of 6.9 million wafers per month.

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The report projects that 200mm fab equipment spending will reach $4.9 billion in 2022, after climbing to $5.3 billion in 2021. 200mm fab utilization is expected to remain at high levels as the global semiconductor industry works to overcome the chip shortage.

According to SEMI’s Ajit Manocha, wafer manufacturers are expected to add 25 new 200mm lines between 2020 and 2024 to help meet growing demand for applications such as 5G, automotive and Internet of Things (IoT) devices, that rely on devices like analog, power management and display driver integrated circuits (ICs), MOSFETs, microcontroller units (MCUs) and sensors.

The report said that foundries will account for more than 50% of fab capacity worldwide this year, followed by analog at 19% and discrete/power at 12%. China is projected to lead the world in 200mm capacity with a 21% share in 2022, followed by Japan with 16% and Taiwan and Europe/Mideast at 15% each.

Spencer Chin is a Senior Editor for Design News covering the electronics beat. He has many years of experience covering developments in components, semiconductors, subsystems, power, and other facets of electronics from both a business/supply-chain and technology perspective. He can be reached at [email protected].