China may become no. 2 fab spender by 2018

Fab expenditure is projected to increase 54 percent annually, hitting $8.6 billion in 2018.

China is expected to become the world's second-largest spender on chip equipment by 2018 as a number of startups there start ramping up new fabs.

It will increase overall fab outlay, including construction and equipment, by 54 percent annually or from $3.5 billion in 2016 to $5.4 billion this year, according to global chip equipment industry association SEMI. The figure will jump to $8.6 billion in 2018.

The bullish forecast comes as market research firm Gartner Inc. said it expects semiconductor industry sales to grow 12.3 percent this year, reaching $386 billion. Gartner said favorable market conditions that gained momentum in the second half of 2016 have raised the outlook for the chip market in 2017 and 2018.

During the two-year period covered by the SEMI report, South Korea, Taiwan and mainland China will lead record spending for fab construction and equipment. Expenditure in Europe will also increase significantly. SEMI forecasts that in 2017, chipmakers will invest more than $49 billion in equipment, a record for the semiconductor industry.

To read the full article, go to EETimes.