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Chip production running flat out, says VLSI

Posted: 25 Nov 2005 ?? ?Print Version ?Bookmark and Share

Keywords:semiconductor market? semiconductor manufacturing? semiconductor? chip production?

Semiconductor manufacturing capacity utilization remained overheated in October and will do so throughout November, according to market research company VLSI Research Inc.

Front-end utilization topped 96 percent in October, while utilization of test and assembly facilities was at 98 percent, the analyst said. These levels have traditionally stimulated sales of equipment.

The overall value for October was 96.6 percent up from 96.5 percent in September. VLSI Research (Santa Clara, Calif.) predicted that the value would slip slightly in November to 95.7 percent.

The consistently high values of capacity utilization are the result of a buildup of demand for the Christmas season arriving with chip makers still feeling the effects of a difficult, low-growth year and unprepared to add capacity to meet the surging demand. Equipment orders in the first half of 2005 had been too light, VLSI Research commented.

In consequence there is rush to bring in and commission equipment. VLSI said this activity would soon abate, as the industry moves past the seasonal November production peak.

- Peter Clarke
EE Times

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