Semiconductors were invented in America and today are one of our nation’s top exports. This is an industry employing over a quarter of a million people in the U.S., supporting more than one million additional American jobs, and is strategically important for our nation’s economic and national security.
Your company should neither own nor lease everything. There should be a set of criteria established for each tool purchase to assess the most advantageous balance of ownership and leasing equipment.
According to Gartner, Inc., worldwide semiconductor capital equipment spending is projected to total $38.5 billion for 2014, an increase of 15 percent from 2013, and total spending is projected to follow an increasing pattern through 2018. The strong, positive outlook for capital spending in 2014 is a result of increased demand across all semiconductor segments.
Mid-level companies that refresh their critical technology manufacturing tools through structured leases stay ahead of their competition by possessing state of the art production capabilities.
Companies that have a strict policy of ownership only influence equipment retention beyond typical depreciation schedules of 5 years. This philosophy puts beneficial upgrades and new technology capabilities on hold, waiting on capital budget approval, when a lease may qualify for payment through the expense funds.
- Replace and/or upgrade equipment quickly and efficiently as upgrades are released.
- Shorten the decision cycle as the additional step of requesting large capital expenditures can be reclassified from capital budget to expense budget in some applications.
- Convert what might be a large purchase into an affordable monthly expense. This means:
- Conserving cash reserves,
- Keeping bank lines of credit open for short-term use
- Cutting out of pocket costs for upgrades
- Enabling new projects in the budget
- Boosting productivity
- Bringing new products to market more quickly