IC Insights specialists studied the semiconductor manufacturing market and prepared a revised forecast for the supply of integrated circuits for 2021 and ratings of the largest developers and manufacturers of these products. The document also contains a forecast of capital expenditures by companies for 2021 and a cumulative one until 2025.
Analysts point out that the development of semiconductor manufacturing is becoming more and more costly. The investment required to develop and master advanced logic technology processes has reached a threshold that only three companies – Samsung, TSMC and Intel – have been able to overcome. Moreover, only two of them can really be considered leading. These are Samsung and TSMC, which have mastered the 7 nm and 5 nm standards. Intel is expected to start serial production of 7-nanometer products no earlier than 2022, when Samsung and TSMC will already begin production of 3-nanometer products.
It is noteworthy that success is directly related to capital expenditures. Although Intel has been among the top two companies in the industry in terms of capital expenditure for 25 of the past 27 years, it spent only about half of what Samsung spent in 2020. This year, it will again lag far behind Samsung and TSMC, each of which will spend about $ 28 billion.
Samsung’s capital investment in semiconductors has remained very high since 2017, reaching $ 21.6 billion in 2018, $ 19.3 billion in 2019, and $ 28.1 billion last year. Samsung’s total spending from 2017 to 2020 of $ 93.2 billion is unprecedented in the history of the semiconductor industry. TSMC is not far behind. IC Insights expects Samsung and TSMC to combine capital expenditures of at least $ 55.5 billion this year, accounting for 43% of the global semiconductor industry’s capex.
Continuing to allocate amounts that are unaffordable for other market participants, Samsung and TSMC are consolidating their lead over them.
And yet, according to the source, companies from the EU, the US and China have the opportunity to catch up with the market leaders. This is possible with government assistance. Given the size of the gap, IC Insights believes that governments will need to commit at least $ 30 billion a year for at least five years to have “any reasonable chance of success.” Analysts make a reservation that for China, even if the funds are available, bans on the sale of critical equipment would surely become an obstacle.
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