Recession - no recovery until 2012

Semiconductor industry will not recover until 2012, says TSMC chairman

The global semiconductor industry will likely experience negative growth in 2009, but will start to rebound at an annual growth rate of 4-5% from next year, according to Morris Chang, chairman of Taiwan Semiconductor Manufacturing Company (TSMC). The industry-wide downturn will decelerate the sector's growth until 2012 when total revenues will resume to meet 2008 levels.

TSMC CEO Rick Tsai earlier estimated that the global semiconductor market will decline 30% this year.

The current economic slowdown will follow the more painful L-shaped curve, said Chang, noting that US house prices are a crucial indicator for a complete economic recovery worldwide. Stability in the housing market implies that consumer confidence has improved. Consumer confidence has become the key for semiconductor industry's revival, Chang added. The evolving world has positioned semiconductor items as commodities and customers now possess strong market power, according to Chang.

Chang made the remarks at an industry conference yesterday (Feb 23).