Semiconductor Packaging/Assembly Poised For Rebound

Compiled ByDeborah Austin The decline in the semiconductor packaging and assembly market is leveling off and should reverse to growth mode by next year, forecasts market intelligence firm Gartner Dataquest, Stamford, Conn. Industry revenue fell 54% in 2001 from 2000 -- to $2.981 billion worldwide -- and will slide another 9% for 2002, says Gartner. But it forecasts a 54% rebound to $4.191 billion in 2003. With portable devices growing and power management crucial, demand for power and discrete packaging will climb, says Jim Walker, principal analyst, Gartner Dataquest's semiconductor research group. But semiconductor assembly and test service consolidation could continue into 2003, with excess capacity and lack of available capital threatening survival for second- and third-tier companies. And Japanese players will accelerate adoption of outsourcing, which began in 2001.