At a Glance

The Moov Difference

While competitors typically take an average of one month (and some up to 6) to pay a seller for a tool, this refurbisher received payment 1 day after the contract was signed through Moov’s global marketplace.

Services Provided

• Secured buyer through global marketplace
• Managed logistics
• Payments
• Real-time GPS tracking and environmental monitoring

Background

A large US refurbisher had entered into a deal with an end user for a top of market tool. However, when the end user was acquired, the deal fell through leaving the refurbisher with a costly asset on their books. When the refurbisher finally turned to Moov, they had already been paying storage fees for this unused asset for 9 months. The refurbisher had tried utilizing numerous brokers to offload the tool to no avail, due in part to the specific requirements of their original buyer. The refurbisher needed this asset off of their books in the new year – so they turned to Moov’s global marketplace for used semiconductor manufacturing equipment in hopes of finding a buyer.

Solution

After months of searching for buyers, the refurbisher was able to quickly secure an international buyer through Moov’s global marketplace. The entire process from contract through arrival, uncrating, and installation took a mere 35 days. Whatsmore, the refurbisher received payment one day after contract signing thanks to Moov’s buyer verification and payment support.

Going the Extra Mile

• Due to port closures, the buyer needed this tool to arrive on an exact date – a request that would typically be near impossible given the unpredictability of global logistics. However, thanks to Moov’s close relationships with global service and logistics providers, Moov was able to ensure the tool arrived on the exact date that the buyer needed it. In turn, this eliminated any headache for the refurbisher, as they were able to completely offload logistics to Moov.
• Moov’s added-value real-time logistics and tracking portal provided complete visibility into where the tool was and in what conditions it was stored en route to the buyer. Both buyer and seller were able to rest assured that the tool was stored in proper environmental conditions during transport, and would arrive in a timely fashion and in the condition promised.

At a Glance

The Moov Difference

Moov worked with this end user to rapidly recapitalize 11 underutilized assets in order to secure production line budget for a critical tool they needed.

Services Provided

• Managed Sales
• Managed Procurement

Background

A production line team at a US manufacturer needed an ICP downstream asher but only had partial funding to acquire this system. Knowing Moov’s marketplace offers the largest selection of pre-owned tools from reliable suppliers, they turned to Moov to explore their options.

Solution

After consulting with Moov’s team of experts with over $1bn in experience helping manufacturers recoup capital on idle and underutilized assets, this manufacturer identified several idle systems they could sell through Moov’s global marketplace. The manufacturer was able to rapidly sell 11 tools in order to gain the capital they needed to acquire a YES Ecoclean system.

Going the Extra Mile

Moov was able to work with this manufacturer to ensure that capital from the sales of their used assets went back to a specific fabrication center and production line budget — ensuring this production line team had the funding they needed to acquire their plasma resist strip/descum system.

AT A GLANCE

The Moov Difference

The end-to-end process of procuring a replacement tool, deinstallation, crating, air freight, rigging and installation would typically take 6 months. Through Moov, the entire process only took 4 weeks, enabling this fabrication center to minimize revenue loss when a critical machine went down.

Services Provided

• Managed service procurement
• Parts
• Deinstallation, crating
• Air freight
• Installation, rigging
• Flexible payment options

Background

A high volume wafer fabrication center in the western US was already in the market for a new ion implanter. When a second tool went down, their situation shifted from “opportunistic” to “critical.” Their senior facilities manager reached out to Moov to learn how they could expedite procuring a VIISion 200 replacement through Moov’s global marketplace.

Solution

Moov’s experienced managed service team quickly identified a tool from an international supplier that matched this fabrication center’s exact requirements. Thanks to Moov’s ecosystem of aftermarket service providers, Moov was able to provide an end-to-end solution for not only procuring the tool but also deinstallation, crating, air freight, rigging and installation. This process would typically take up to 6 months, but Moov was able to provide a 4-week solution to help this fabrication center get back up and running.

Going the Extra Mile

• Knowing this fabrication center needed to avoid any further delays, Moov proactively sourced the exact model of pump the fab needed, at a discount, from a refurbisher partner, to ensure the client was able to get their new implanter up and running smoothly.

• Since the process of procuring and delivering this replacement system moved so fast, it took longer for payment to process than it did to ship and install the tool itself. Thanks to Moov’s flexible payment options, the team was able to accommodate expedited delivery while still ensuring the seller was paid in a timely fashion.

In 2022, the semiconductor industry faced challenges including slowing sales growth and tensions in the global supply chain. However, the industry also saw record levels of investment in research and development by U.S. companies and the passage of the CHIPS Act, which provides incentives for domestic chip manufacturing, bringing total business Private Investments for U.S. Semiconductor Production to over 200 billion dollars. The US CHIPS Act has already prompted new commitments to construct manufacturing facilities in the US, and it is expected to create jobs and drive economic investment. The Act provides $52 billion in funding for a range of technologies, including large-scale fabrication facilities and projects for current-generation chips, new and specialty technologies, and manufacturing equipment and material suppliers. It also includes a 25% advanced manufacturing investment tax credit. In addition to manufacturing incentives, the CHIPS Act also focuses on research and development, with $13 billion in funding to foster collaboration between government, industry, academia, and other stakeholders and to develop the pipeline of scientists and engineers necessary to fuel future innovation in the semiconductor industry. The Act establishes several programs to support R&D, including the National Semiconductor Technology Center, the National Advanced Packaging Manufacturing Program, Manufacturing USA Institutes, and the CHIPS Defense Fund. Other countries that have implemented their own chips acts include Europe, Taiwan, China, South Korea, and Japan, with hundreds of billions of dollars added to the global investment in semiconductor manufacturing and research. Despite these efforts, significant challenges remain for the semiconductor industry, including developing a skilled workforce, maintaining leadership in chip design, and maintaining access to global markets and supply chains. To overcome these challenges, it is essential for the industry to maintain a strong partnership with local governments and other key players, to ensure that the industry is able to meet the increasing demand for semiconductors.

The semiconductor industry has created a new sector called power semiconductors. With the growing demand for technologies like electric vehicles, charging stations, fast power charging devices, solar / wind industries, and even battery-powered portable devices used in everyday life. You can expect to continue seeing the term power semiconductors in the future. Semiconductors are typically made with Silicon (Si). Silicon has been great to use up to the point where we needed to use high power and to be able to withstand higher temperatures. Due to the makeup of silicon, it is limited in how it can be used in these applications, but the industry has been working on solving this issue with substrates like gallium nitride (GaN) and silicon carbide (SiC), also known as power semiconductors. Power semiconductors will change the industry as we know it. One of the challenges the industry has faced in adopting power semiconductors is that power semiconductor wafers like SiC and GaN need to be grown using different methods and processes than silicon, which limits the diameter that they can grow the ingot. This means they can only currently make power semiconductor wafers in 200mm diameter and below. And, because the industry has largely moved on to manufacturing semiconductors on 300mm wafers, the power semiconductor industry has faced challenges in sourcing older equipment used for 200mm and below. Many original equipment makers have stopped making 200mm equipment. But, with the billions of dollars now backing this industry, power semiconductor manufacturers have options for sourcing 200mm equipment. For example, Moov Technologies, helps manufacturers around the globe buy and sell used and refurbished equipment from other fabs. Even original equipment manufacturers have started bringing back 200mm product lines to meet demand.

According to Straits research, the global power semiconductor market was valued at $40 billion (USD) in 2020 and It is estimated to reach an expected value of $55 billion (USD) by 2030. Today, some of the biggest manufacturers are investing in the global power semiconductor market like Infineon Technologies, Texas Instruments, ST Microelectronics, NXP semiconductor, ON Semiconductor Corporation, Renesas Electronic Corporation, Broadcom, Toshiba Corporation, Fuji Electric, WolfSpeed, and ROHM, just to name a few. With companies like Infineon investing 2 billion dollars, Wolfspeed investing 6.5 billion dollars, SK Siltron spending 300 million dollars, and SEMI announcing, the Global 200mm fab capacity is expected to surge by 20% through 2025. I would say the 200mm industry is alive and well, with a great future ahead with technology like power semiconductors driving the industry.

Industry Growth & Government Funding

The industry will grow 10% in 2022 to over $600 billion (USD) globally. Of the 29 fabs starting construction in 2021 and 2022 China and Taiwan will lead the way in the new fab construction starting with eight each, followed by the Americas with six, Europe and the Middle East with three, and Japan and Korea with two each. This is a breakdown of some of the spending and growth expected by region:

US: The US currently accounts for 12% of global chip manufacturing, down from 37% in 1990. To regain chip manufacturing capacity, the US government has passed and funded The CHIPS and Science Act which unlocks nearly $250 billion in funding and tax incentives for the US semiconductor sector. Federal funding combined with state and local incentives has been successful in securing investment from top global manufacturers to build new fabs and expand capacity in the US. Just to list a few investments: Intel, TSMC, Samsung, Micron, and Texas Instruments have announced a combined $650 billion in planned spending.

EU: The EU Chips Act will provide 43 billion euros ($49 billion USD) of investment into the semiconductor industry with many tax incentives. Specifically, the EU wants to boost its market share of chip production to 20% by 2030, from the 9% that it currently holds. Intel alone has announced the first phase of a plan to spend up to €80 billion in manufacturing and research facilities in Germany, Ireland, Italy, Poland, Spain, and France.

ASIA: In the next decade, the South Korean government will work in collaboration with local companies to invest $450 billion (USD) into the establishment of the world's largest semiconductor industry supply chain. Japan plans to attract more advanced technology investment from abroad. Japan has also set up a fund of almost $1.5 billion USD and plans to substantially expand support policies. The second phase of the China National Fund was also approved in 2018, which means $30 billion (USD) from the second phase of this fund will be invested in the semiconductor industry over the next few years. Companies in Taiwan plan to invest over $107 billion (USD) in semiconductors by 2025. Last but not least the newest player in the industry, India, is planning to invest $30 billion (USD) in the tech sector/semiconductor supply chain as Silicon Nationalism becomes the new global trend.
Top Challenges

Labor and Talent: Labor and talent shortages worldwide will be a bigger problem than expected. In the US alone there are 90,000 semiconductor jobs that need to be filled by 2025. Today wages and inflation are affecting the ongoing talent war as companies struggle to fill positions as compensation has not risen materially to compete with other industries and the cost of living especially in cities like Austin and Phoenix continues to go up. The US government is working hard to fund & develop the National Semiconductor Technology Center which will provide funding to educational institutions that will help build up & educate the future semiconductor industry workforce. Chip Shortages: Chip shortages will continue into 2024, according to Intel CEO Pat Gelsinger. Efforts started in 2021 to expand capacity for legacy nodes – namely, a 10-15% increase in 200mm and 300mm wafer capacity – will not yield results until 2023. Investment in leading-edge fabs in Arizona, Texas, and Ohio will take 3-4 years to build and cost $20bn each. In short, expanding capacity and building new fabs is a long process so we should continue to expect to see supply shortages in the interim.
OEM Supply Chain Disruptions: Original Equipment Manufacturers in the semiconductor industry have experienced the worst supply chain shortages in history. Supply chain issues are causing delays for almost all new equipment currently on order. One solution that many OEMs are implementing is to bring home domestically a lot of the component manufacturing. By reducing the long international shipping times and having more of the components made in the US, they can greatly reduce long supply chain lead times. The other solution is to qualify more domestic suppliers and reduce the qualifications and lead times needed to become a certified supplier to OEMs.

Top Opportunities Government Investment - The influx in investment from governments across the world to bolster their domestic semiconductor ecosystems will likely attract additional private capital investment in the industry and create fruitful partnerships between governments, the private sector, and academic/research institutions. Global Alliances - While the trend of Silicon Nationalism has fueled a chips arms race of sorts, it has also reminded the industry that global interdependence is required to support the industry. New Technologies and Innovation - The innovation of new technology will continue to drive the industry. New technologies such as the Internet of Things, will have incredible growth in the future with over a trillion devices by 2035. These devices will have continuous developments in software, and the hardware will be made on new FPGA technology so that new software uploads can update old hardware functionality allowing IoT devices to evolve as new technologies are created.

OEMs, also known as original equipment manufacturers of semiconductor equipment around the globe are having some of the most profitable years recorded in history. But with this growth, they are also experiencing severe growing pains and supply chain issues causing delays for almost all new equipment currently on order. If an OEM is not able to order a specific component like a harness plug or a robot blade, they cannot simply grab the next off-the-shelf component to fill that shortage due to the strict qualifying process that is needed to become a certified partner and or vendor supplier to the OEM. In the past, it could have taken years for a company to become a certified vendor to some of the top OEMs. Today, that process is getting cut shorter, but still, so many OEMs are experiencing challenging supply chain problems and forcing them to ship equipment short some specific parts due to long lead times. According to the Wall Street Journal, two of the biggest OEMs, Applied Materials (AMAT) and Lam Research (LRCX) both saw missed or deferred revenue due to supply chain issues last quarter.

One solution that many OEMs are implementing is to bring home domestically a lot of the component manufacturing. By reducing the long international shipping times and having more of the components made in the US, they can greatly reduce long supply chain lead times. According to Oscar Draguicevich at Fathom Digital Manufacturing Corp (NYSC: FATH), a company that locally manufactures parts for semiconductor OEMs, Fathom has seen a great influx of orders from domestic OEM manufacturing companies, for all types of parts. Companies like Fathom who can mass-produce these parts domestically are happy to grow with the new demand. However, as Draguicevich pointed out, with this demand for parts delaying production, domestic part manufacturing needs to be even more of a focus in the future and sustainable business relationships must be forged.

Today, tools from all of the top 5 OEMs of semiconductor equipment are on backorder. With component delays, OEMs cannot manufacture and test equipment fast enough to meet demand. However, with the passing of the CHIPS Act of 2022 by the Senate this week, and likely passing in the House within the week, new incentives exist to ramp up domestic manufacturing of chips, equipment, and parts. Hopefully, some of the incentives – whether through grants or the 25% tax credit outlined in the CHIPS Act – will trickle down to local parts manufacturers like Fathom to fill the seemingly but critical supply chain gaps hampering OEMs today.

According to US Secretary of State, Gina Raimondo, chip shortages are likely to last through 2023. Intel’s CEO Pat Gelsinger, went as far as to predict shortages will last through 2024 in April. As many in the industry know, building new fabs to ramp up production is not a quick task – it can take 3-5 years to build a new fab. Expanding capacity of existing fabs is also not a “quick fix.” To truly understand why ramping up chip production is a problem without an immediate solution, it’s helpful to understand on the day-to-day level what is involved in installing new equipment in a fabrication center – from build to running full production.

The process of ordering semiconductor equipment to run full production at the customer fab can be a long, timely process. Besides the chips themselves, semiconductor manufacturing machines can be some of the most difficult equipment that we manufacture on a large-scale production manufacturing line. To take the equipment from a custom configuration order to running full production in a fab can take years based on the type of equipment you are ordering.

There are two methods of manufacturing and testing equipment. One is Integrated Final Test (IFT) and the other is the Module Final Test(MFT). IFT is when all of the different modules like chambers and mainframes are manufactured,integrated, and tested as a whole unit completely from back to front just like it would be set up in the fab. IFT is a more efficient way to test the unit but many fabs for the sake of time and money are going to modular final test (MFT). MFT is where individual units like the chambers, the factory interface, and the mainframe are built and tested separately, then a more detailed IFT test is run in the customer fab after all the parts are integrated. This method is cost-efficient for OEMs, especially when OEMs have separate modules made in different parts of the world.

After a tool is shipped to its customer, the tool is unpacked, inspected, wiped down, and brought into the fab, and, depending on the type of tool, this could mean just rolling it in and plugging it into the wall outlet or carefully floating in the tool to the specific location on a specially designed hovercraft that prevents any bumps or shocks to the fragile internal equipment. After setting the tool or separate modules on a template with all the floor cutouts and sometimes shock absorption platforms, the process of integrating all the chambers, factory interface, mainframes, cables, gas lines, and sub-fab support equipment to the tool begins. Depending on the tool type and the type of install speed the customer ordered and paid for, the installation process of the tool can take days up to many months to complete the full integration of a tool. But once the tool is finally integrated and fully connected to all the facilities it is now ready for power-up and test. Many people would assume this means flipping on a switch and turning on the machine, but this is far from what really has to be done. Some of the first testing includes running virus checks, connecting the tool to the fab mainframe / AMHS, and making sure it is talking to all the other systems. Other important systems checks include running leak rates, training robots, verifying configurations, and other facilities connected to the tool. Other testing includes the operations checking of all the different components and support equipment, running particle count wafers to be sure there are no internal particle issues, uploading recipes, and running dummy wafers to be sure all the robot handoffs are correct. After days or months of testing and bringing the tool online, the next stage of running the full process on test wafers begins.

What is a full process test? This depends on the tool and the process. Some of the equipment used in semiconductor manufacturing uses extreme temperatures as hot as the surface of the sun and pressures that can pump down to a vacuum of 1x10-9 Torr, relatively close to the vacuum of deep space that is 1x10-6 to <3x10-17 Torr.The final stage of bringing a tool online to running full production includes the final tuning, testing recipes, and verifying this tool can run full production for every wafer identically every time it runs the process.

As we can see, the process of ordering a tool, to running full production is complex. With equipment shortages and delays leading to lead times of up to 18 months from OEMs before a tool even arrives at the fabrication center, it is easy to see how the process of expanding capacity could take not months, but years.