https://www.scmp.com/tech/tech-trends/article/3129611/us-chi...
In particular in China and South Korea.
I wonder when all this extra capacity translates into more supply?
Maybe China and South Korea will be alright, as they can focus on the Chinese market in a world bifurcated by the US-China Tech war, but for the rest of the world, it seems that a supply glut is sure to follow?
2019, though, not so much. All the capacity came online at the same time, there was oversupply, the price of 3D NAND plummeted, and the chip companies pulled back buying dramatically, sending the equipment suppliers from feast to famine, again.
I recall a 2-year period in the late '90s where the San Jose Mercury News headline in August read '1,000 Jobs Open at Lam and Applied' to one year later, 'Lam to Lay Off 1,500'.
Edited- typo.
I view it like the construction industry. I worked as a concrete/asphalt inspector for my local municipality in college and the cycles of the road repair industry are similar in my mind. In this world there are lots of "crews" that travel around the country following the work. They start in the south in the winter, and gradually work their way up to the north as the ground thaws and road construction can be done. They usually have a 2 week - 2 month contract in each town and then move on. No one area has enough work to keep them busy for a season. The industry is built on that ability to maximize work/profit and minimize downtime by moving from customer to customer as the work does also.
I view it as similar for many of us who do/have worked in semi. When there is a glut of work, it's all good. When there isn't there are hundreds or thousands of highly skilled, highly specialized folks needing work. Those folks/consultancies typically are able to pivot to other industries that need the same skillets readily and easily (like medtech, aerospace, automotive, etc.) and keep working during the slow period for semi. The alternative would be for semi equipment designers/manufacturers (like ASML, etc) to rely more on in house permanent workforces and less on contractors and subcontractors but I fear a fundamental change like that may not be sustainable from a cost standpoint. These companies already have huge swings in their workforce numbers every few years, often hiring or letting go hundreds or thousands at a time.
Edited - typo
South Korea, I don't know. The spike in equipment purchase certainly sticks out, maybe they (SK) expect to be able/allowed to supply the Chinese companies, that Taiwan can't/won't?