Taiwan Semiconductor Industry set to become world's largest.June 8, 2011 -
According to data from Semiconductor Equipment and Materials International, Taiwan is poised to overtake Japan in 2011 as world's largest semiconductor materials market. Taiwan's market grew from US$6.87 billion in 2009 to estimated US$9.11 billion in 2010, representing 36.2% growth. Taiwan's government is taking steps to improve competitiveness of domestic chip industry, and Taiwan's National Science Council is making ties to develop new technologies to further technological edge.
Taiwan's Semiconductor Industry to Become World's Largest in 2011
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Taiwan External Trade Development Council
5th Fl., 333 Keelung Rd., Sec. 1
Taipei, 11012, Taiwan
Press release date: June 6, 2011
Taiwan's market is set to surpass Japan's, boasting a YoY growth of over 36 percent in 2010.
TAIPEI, TAIWAN - Taiwan is poised to overtake Japan in 2011 as the world's largest semiconductor materials market, according to data from SEMI (Semiconductor Equipment and Materials International). The global trade organization also said Taiwan's market grew from US$6.87 billion in 2009 to an estimated US$9.11 billion in 2010, representing a growth rate of 36.2%.
Data shows that the global semiconductor material market rose 25 percent last year from the previous year to a value of US$43.55 billion. That represented a new high since 2007, when it recorded US$42.67 billion.
Amid this growth, Taiwan's government is taking steps to improve the competitiveness of the domestic chip industry, which accounts for nearly half of the market capitalization on the Taiwan Stock Exchange (TSE). Taiwan's National Science Council (NSC) has been fostering ties between universities, research organizations and semiconductor companies to develop new technologies to enhance the island's technological edge in the market.
Taiwan's National Chip Implementation Center (CIC), for one, has announced a new method of fabricating chips that cuts development time by two-thirds while also slashing costs in half. The new technology stacks chip modules on top of each other, thereby enabling higher density of electronic components on a circuit board. The new method could lead to smaller mobile devices. NSC has called Taiwan Semiconductor Manufacturing Co. (TSMC) - the world's biggest chipmaker - a key investment partner in the new technology, which TSMC Chairman Morris Chang has referred to as a paradigm shift.
TSMC posted NT$36.28 billion (roughly US$1.2 billion) in net profit in the first quarter of 2011. Morgan Stanley said the firm's better-than-expected first quarter earnings reflected its efforts in controlling operating expenses and maintaining its gross margin.
"Our thesis for investors is to take a more cautious stance on the foundry sector overall, but to overweigh TSMC on its significant exposure to smartphones and tablets," the brokerage said. "The fact is TSMC is outperforming peers, and communications is outpacing other sectors to give us more confidence in the thesis."
TSMC also recently said that it estimates the company's sales for 2011 will rise 20 percent from 2010 in U.S. dollar terms. In addition, the company said it also expected its sales for the second quarter would rise 3.4 percent to 5.3 percent from the first quarter.
In addition, TSMC has announced that it will double output capacity to an equivalent of over 20 million 200mm wafers in five years. It said that was to meet strong demands likely to be driven by three emerging directions guiding hi-tech industry developments. Those are human-machine interface, digital-media technologies and a quickly diversified environment.
Other major semiconductor firms in Taiwan include UMC (United Microelectronics Corporation) and Mediatek, which is a fabless semiconductor company.
With their focus on marketing, design, masking, production, testing, and packaging, Taiwan's semiconductor manufacturing firms have had a huge effect on the momentum of vertical disintegration in the global industry. What more, Taiwan exerts a strong influence over the Chinese semiconductor market. Therefore, global upstream materials firms all maintain an active presence in Taiwan, from where they can service the entire Asia Pacific market. TSMC www.tsmc.com/
About Taiwan External Trade Development Council (TAITRA) The Taiwan External Trade Development Council (TAITRA) was founded in 1970 to promote Taiwan's foreign trade and competitiveness in world markets. Over the past 40 years, TAITRA has played a key role in the development of the Taiwan economy. TAITRA is jointly sponsored by the government and commercial associations and is viewed by all as the business gateway to Taiwan for the international business community. Please visit www.brandingtaiwan.org or www.taiwantrade.com.tw for more information.