With global demand for semiconductors in sharp decline, SEH America Inc., which makes silicon wafers used in chipmaking, is shutting down production at its Vancouver plant for a month starting Friday.

The shutdown affects about 750 SEH workers out of a total work force of 840, said Gary Jenks, SEH spokesman.

We have seen slowing demand since last October but have been able to stay the course until now, Jenks said. The (temporary) shutdown is the next phase. We are asking our workers to help deal with the situation.

SEH grows silicon ingot and makes thinly sliced silicon wafers for customers such as Intel Corp. and Texas Instruments. These chipmakers use silicon material to make semiconductors that go into a variety of retail and commercial products, from cell phones and video games to personal computers and automotive components.

Across all categories, market demand for chips has declined in the past six months at an accelerating pace.

On Monday, the Semiconductor Industry Association reported that global sales of semiconductors were severely affected by the worldwide economic turmoil last year. Total sales for 2008 were $248.6 billion, compared with $255.6 billion in 2007, a decrease of 2.8 percent.

December sales fell from $22.3 billion in 2007 to $17.4 billion in 2008, a decline of 22 percent. December sales were down 16.6 percent from Novembers $20.9 billion.

Several thousand workers are employed in chip-related businesses in Clark County, including those at Linear Technology Corp. and the big WaferTech chip foundry in Camas.

Jim Short, WaferTech director of facilities, said the foundry has also been curtailing work hours of the 1,000 people employed at the Camas operation.

Weve been doing days off across all aspects of the business, Short said. We see low (plant) utilization right now, and not much visibility (in terms of customer demand) past February.

In its most recent financial report issued Jan. 22, WaferTechs owner, Taiwan Semiconductor Manufacturing Co., reported a net sales decline of 30.6 percent in the fourth quarter ending Dec. 31 from the previous quarter and a 31 percent year-over-year decline.

Global outlook

Semiconductor association President George Scalise said Monday that the global economic recession severely dampened semiconductor sales in the fourth quarter of 2008, historically a strong quarter for the industry. The industry is facing an unprecedented period of uncertainty. A resumption of sales growth will depend in part on the effectiveness of various measures now under consideration by the Federal government to restore consumer confidence, improve liquidity, and stimulate economic growth.

Jenks said his company remains positive about an industry recovery. Every previous downturn has been followed by an equally robust business upturn, Jenks said. We remain optimistic that this will happen this time, too.

SEH AMERICA WORK CURTAILMENT

* WHAT: Due to declining computer chip demand, industry supplier SEH America in Vancouver is stopping production for a month.

* PRODUCT: Silicon wafers used in semiconductors.

* SHUT DOWN: Friday through March 9.

* IMPACT: 750 workers out of work force of 840.

Originally published by Julia Anderson.

(c) 2009 Columbian. Provided by ProQuest LLC. All rights Reserved.

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