Gartner: Asia Dominates Global Chip Production

By Agence France-Presse Asia dominates the global contract chip-making industry with nearly 80% of the world's production valued at more than $8 billion, an industry monitor said June 5. Last year, the Asia-Pacific's share of the worldwide industry stood at 78.1% and generated revenues of $8.2 billion, technology research firm Gartner Inc. said. Led by Taiwan, the epicenter of contract chip production with more than 83% of the region's output, Gartner predicted Asia-Pacific's contract chip-making industry would grow 23% this year. That is expected to generate revenues of at least $10 billion, the Stamford, Conn-based firm said. "Utilization rate in the current quarter is estimated to top 75%, with wafer shipments and ASP [average selling price] projected to increase by 26% and 2% quarter over quarter respectively," Tan Kay-Yang, Gartner's principal analyst for semiconductors, said. Despite the rosy projections, the industry still faces downside risks, Gartner said. "Although geopolitical uncertainty in the Middle East have receded and the Severe Acute Respiratory Syndrome [SARS] pandemic in Asia has improved, downside risks nonetheless still remain," Tan said. "The overall semiconductor business sentiment continues to appear highly capricious and volatile in the second half." Copyright Agence France-Presse, 2003