The international chip market is set to plummet by over a third in 2001, industry watchers warned today.
Trade organisation Semiconductor Equipment and Materials International (SEMI) warned that chip manufacturers can expect 2001 sales to decline by 35 per cent from the record £34.1bn ($47.7bn) shipped in 2000.
The SEMI forecast estimates 2001 sales of £22bn ($31bn) which still represents the industry's second best year on record.
The study found that some 40 per cent of chip makers expect the market to hit bottom in the last three months of the year, while just over a third believe the worst won't be over until next year.
The forecast anticipates overall market growth of 11.6 per cent, to £24bn ($34.6bn) in 2002, and 22.5 per cent growth, to £30bn ($42.4bn) in 2003.
SEMI's Stanley Myers said: "The bust in the end markets led to lower demand and over-capacity, which also led to over-inventory. Chipmakers simply stopped ordering new high-tech manufacturing equipment."
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