A bright outlook for 2004; barring unforeseen events, 2004 is projected to be good year.The year 2004 promises to be one for improved economic growth in the electronics industry. Foundries such as TSMC TSMC Taiwan Semiconductor Manufacturing Company, Ltd
TSMC Taiwan Semiconductor Manufacturing Corporation
TSMC Traffic Systems Management Center
TSMC Toll Station Management Controller
TSMC Transportation Supply Maintenance Command
TSMC Technical Services Manager Code , UMC UMC United Methodist Church
UMC United Microelectronics Corporation
UMC University Medical Center
UMC United Microelectronics Corp (Republic of China)
UMC University of Missouri-Columbia and Chartered are reporting high capacity utilization Capacity Utilization measures the rate at which a firm makes use of their capital productive capacities, such as factories and machinery. Capacity Utilization generally rises when the economy is healthy and falls when demand softens. . Contract assembly operations report increases in capacity utilization and improved earnings. Driven by the latest craze over camera phones and new features, mobile phone production surpassed 450 million units in 2003 with a 10 to 15% growth rate projected for shipments in 2004.
Consumer electronics sales are expected to be strong for digital cameras and camcorders, MP3 players and DVDs. Digital camera sales passed 35 million units in 2003 and are projected to grow as much as 25% per year. (1) Demand for personal computers is increasing, and the server market is growing. With the growth of electronic content in cars, automotive electronics is a bright spot. According to according to
1. As stated or indicated by; on the authority of: according to historians.
2. In keeping with: according to instructions.
3. Henderson Ventures, "global production of automotive electronics will grow by 11% in 2004." (2)
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Recovery in Asia
After a decade of poor economic performance, Japan's economy seems to be on the rebound. Taiwanese companies are reporting improved business in the electronics sector. China continues to be an important growth area, reporting an 8.5% gross domestic product growth rate in 2003. China's production of laptops and mobile phones continues to grow, and manufacturing for domestic consumption and export markets is strong for these and other electronics products. Concerns about trade friction abound as China expands its own domestic electronics industry. Despite the entry into the World Trade Organization, China still places a 17% tariff on imports of foreign semiconductors in electronics sold in its domestic market.
Expansion of China's domestic semiconductor industry continues in both capacity and services. SMIC SMIC Salaire Minimum Interprofessionnel de Croissance (French: guaranteed minimum wage)
SMIC Semiconductor Manufacturing International Corp (Shanghai)
SMIC Side Mount Intercooler will offer wafer bumping this year, based on the transfer of equipment from Singapore's MicroFab. If all goes as planned, nine 8-in. semiconductor fab See fab. plants will be located in the Shanghai area this year. (3)
Advanced Packaging Drives Profits
Shipments of advanced packages--such as ball grid arrays (BGAs) and chip-scale packages (CSPs)--continue to drive the growth in revenue and margins for the integrated circuit integrated circuit (IC), electronic circuit built on a semiconductor substrate, usually one of single-crystal silicon. The circuit, often called a chip, is packaged in a hermetically sealed case or a nonhermetic plastic capsule, with leads extending from it for (IC) package subcontract assembly operations. Data from Taiwan's Industrial Technology Research Institute shows that BGAs account for less than 8% of unit volumes; BGA (Ball Grid Array) A popular surface mount chip package that uses a grid of solder balls as its connectors. Available in plastic and ceramic varieties, BGA is noted for its compact size, high lead count and low inductance, which allows lower voltages to be used. sales account for more than 53% of revenue for Taiwanese companies.
Wafer bumping is expanding with strong demand for gold bumping driven by sales of driver ICs for flat panel displays and solder bumping A technique for attaching chips to a printed circuit board. Tiny globes of solder are attached to the bonding pads on the chip and then melted in place on the board. See BGA and flip chip. driven by the move to flip chip A chip packaging technique in which the active area of the chip is "flipped over" facing downward. Instead of facing up and bonded to the package leads with wires from the outside edges of the chip, any surface area of the flip chip can be used for interconnection, which is typically done and wafer-level packaging. Companies are expanding bumping capacity in Taiwan, Japan and China. In the U.S., the long awaited sale of the K&S Flip Chip Division to start-up RoseStreet Labs unleashes the new organization--now called FlipChip International--to tackle new markets. Almost all of the major contract assembly houses now offer wafer bumping and wafer-level packaging, including Amkor, ASE (Adaptive Server Enterprise) A relational DBMS from Sybase that runs on Windows NT/2000, Linux and a variety of Unix platforms. ASE is a comprehensive and robust data management product with a long history dating back to the late 1980s. , ChipPac, Fujitsu Microelectronics, Shinko Electric, Siliconware (SPIL SPIL Signal Processor In the Loop
SPIL Society of Petroleum Industry Leaders (Naked Gun 2½: The Smell of Fear)
SPIL Siliconware Precision Industries Limited (Taiwan) ) and ST Assembly Test Services (STATS).
Stacked die packages continue to see double-digit growth. Almost every mobile phone and digital camera contains at least one stacked die CSP (1) (Certified Systems Professional) An earlier award for successful completion of an ICCP examination in systems development. See ICCP.
(2) (Commerce Service P . While much of the volume has been in the two-die stacked package, an increasing number of stacked die packages with three, four or five die are shipping. In addition, Fujitsu Micro-electronics, ChipPAC and Intel are offering eight die stacked CSPs--some with interposers between the die (Figure 1).
The inclusion of logic and other components makes this a year to watch system-in-package (SiP) and system-on-chip (SOC) developments. While IC designers continue to integrate functions into a single die, economics at the wafer fab level and business decisions often drive the need for SiP. While industry analysts have no consensus on a clear definition for SiP, they all agree that this segment will see lots of action.
With legislative deadlines looming in Europe, lead-free assembly is becoming an issue for many U.S. companies. Some Japanese companies This is a list of companies from Japan. Note that 株式会社 can be (and frequently is) read both kabushiki kaisha and kabushiki gaisha (with or without a hyphen). See that article for more details. are already shipping up to 25% of components with lead-free finishes. Memory makers may offer new packages with only lead-free finishes. Many consumer electronics, mobile phone and laptop computer makers offer products with lead-free solder. Greater interest in recycling may emerge as an alternative solution in the lead-free dilemma.
While an upturn seems to be in progress, what the future holds is up to speculation. The U.S. economy typically sees a boost during an election year. While many economic indicators Economic indicators
The key statistics of the economy that reveal the direction the economy is heading in; for example, the unemployment rate and the inflation rate. will show improvement, employment growth in the electronics manufacturing sector is expected to show smaller gains as jobs continue to move offshore. Protectionist actions in the U.S. and other countries and their impact on international trade are of great concern. Higher interest rates driven by excessive deficits will dampen future growth. Regardless of future economic scenarios, 2004 promises brighter prospects than recent years, and the electronics industry should benefit.
(1) 2003. Sales of Digital Cameras on Torrid Pace as Makers Extend Lines. Journal of the Electronics Industry. A Dempa Publication. December, p. 25.
(2) Henderson Electronic Market Forecast Newsletter. Los Altos, CA: Henderson Ventures. www.hendersonventures.com.
(3) 2003. Semiconductor Market in China and Asia: Shanghai's 8-inch Fabs. Semiconductor World. Japan: Press Journal. November, p. 108.
E. Jan Vardaman is president of Tech-Search International, Austin, TX; email: jan@TechSearchInc.com.