Global spending on semiconductor capital will reach $44.8 billion this year, a 51 percent jump over 2003, Gartner said. And worldwide spending on capital equipment in the industry is projected to surge 64 percent to $37.3 billion this year.

Those figures top the growth seen in 2003. Last year, chip capital spending grew just 8 percent and capital equipment spending increased 10 percent.

Spending in specific segments of the industry, such as wafer fabrication equipment, packaging and assembly machines, and automated testing gear, are projected to increase by more than 63 percent each this year, Gartner said.

Wafer fabrication plants reached 94 percent capacity at the end of the second quarter, Gartner said. The company said, however, the surge won't continue forever.

Gartner predicts that spending on chip capital will grow 13 percent in 2005 before shrinking 15 percent in 2006 and 17 percent in 2007. Gartner sees a recovery in 2008 with growth of 12 percent.

By: 2004
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