New Integrated Circuit Technology Promises Faster Processing Speeds and Lower Power Consumption.

Electronic components distributors have reason to be optimistic as Singapore becomes an increasingly attractive production hub for the semiconductor industry. Western chip manufacturers and related suppliers are increasing their output in Singapore to meet the demand for long-term growth and to diversify supply chain risks. French substrate manufacturer Soitec plans to invest €400 million ($430 million) to double its production capacity at its wafer plant in Singapore, while US semiconductor equipment manufacturer Applied Materials is building a $450 million plant in Singapore to strengthen its ties with Asian chip manufacturing customers.

Soitec is expanding its factory located in Singapore's Pasir Ris wafer industrial park, which is the company's only production base outside of France. The project is expected to be completed in 2024, with the addition of 45,000 square meters of building area. The factory produces silicon-on-insulator (SOI) wafers, and the expansion will double its production capacity of 300mm SOI wafers to 2 million per year. Soitec's CEO Pierre Barnabe is optimistic about the company's prospects, as the current slowdown in the semiconductor industry has not affected its main market for energy-saving wafers, namely mobile communications, automotive and industrial applications, as well as connected devices.

Applied Materials' Asian center is based in Singapore, and the new plant is part of the company's eight-year expansion plan called "Singapore 2030". The new factory, which broke ground in December 2021, is expected to be completed in 2024, and will increase local staff numbers by about 40% to over 3,500 people. Applied Materials plans to meet the growing demand from major customers such as TSMC by increasing its production capacity in Singapore. In addition, the new plant will conduct research on commercializing new technologies, improving semiconductor capacity, and energy-saving initiatives. Applied Materials will partner with the Institute of Electronic Engineering at the Agency for Science, Technology and Research in Singapore to conduct joint research on hybrid bonding and other 3D chip integration technologies.

With global countries competing to attract chip-related enterprises, Singapore's efficient logistics system enables it to integrate well with customers from China, Taiwan, South Korea, and Japan. The semiconductor industry accounts for 7% of Singapore's gross domestic product. As a result, electronic components distributors should keep a close eye on Singapore's growing importance as a hub for the semiconductor industry.