The supply and demand ratio at fabs is beginning to look shaky, dipping to a lower lead time at foundries than even when the world was hit by recession. Lead times for 8-inch fabs have dropped to under two weeks compared to ten weeks the start of the year.
Unnamed sources in Taiwan said that lead times for six and 12 inch wafer processes have been shrinking too, dropping to roughly three weeks. Early inventory adjustments have been needed because of weak demand throughout the second quarter, the sources told DigiTimes.
A chip analyst, who requested not to be named, told TechEye: "The chip design people have seen a slight decrease in sales during the end of the second calendar quarter, but this isn't an exact science and if they're not careful they'll find themselves in trouble again.
"Earlier this year, production at Nissan came to a standstill simply because they did not anticipate the ebb and flow of demand in an industry which still has undercapacity.
"Most of the foundry business is centred in Taiwan and Asia. If they haven't got products because they're slowing down on stock, they haven't got anything to sell."
Semiconductor firms suffered from undercapacity earlier this year, partly as a result of an unexpected rebound in demand.
*Update Malcolm Penn of FutureHorizons got in touch with us tell us that this is complete and utter bollocks. He told TechEye: "Total, absolutely, wrong and insane. The only way to do it would be on a fast lot basis, not on a production basis.
"It's a bunch of crap, there is no fab in the world that can turn a wafer around in two weeks. Three months is typical. Two months if you're really good.
"Just one word from the semiconductor industry and you'd know it was nonsense."
Malcolm doesn't mince his words - thanks for correcting us, we screwed up and so did DodgyTimes.