Refurbished equipment: heating up and coming of age
ClassOne Equipment Inc., Atlanta, GA USA
The refurbished semiconductor equipment market is heating up quickly. In a recent report, Gartner predicts that 2010 will see a jump of 65% over 2009 figures . And considering all sources of supply, the total market in 2010 could reach $2.1B . The recent forecasts notwithstanding, the refurbished equipment segment has always been hard to define. Until around 2002 it was fragmented and disorganized with many brokers simply "flipping" equipment from one fab to another. Similar to real estate agents who broker homes between buyer and seller, these brokers had little invested aside from time and effort. There was a huge separation from buying new and going to the used market where the motto was often: no support, no service, no guarantees.
As the semiconductor industry has matured, however, and the original device manufacturer (ODM) has become more demanding, the gap has narrowed. Now OEMs, such as Suss MicroTec and KLA-Tencor, have established their own internal refurbished equipment divisions, and the "refurbisher" segment has emerged. Both will continue to grow and offer the end customer a global presence for refurbished options.
Defining the used equipment market
The used equipment market can now be defined as OEM sales, fab to fab sales, lend-lease and broker sales, and refurbisher sales. It has become a viable alternative to new equipment sales, especially considering that it can offer equipment lead-times that are often half of those for new equipment and costs that can be 40-70% reduced.
Until recently, 150mm tools have been the focus of refurbished equipment, but now, all segments of microelectronics manufacturing are being affected. There is a glut of 200mm tools available; the supply could last through the end of 2010. And now 300mm tools are on the market from fab closures such as Qimonda.
Analog manufacturers, who closed many 100mm and 150mm fabs during the downturn, have entered the market for refurbished tools as they move to 200mm fabs. Foundries are active in this market as they look to boost capacity quickly. The Chinese semiconductor ODMs may be the biggest buyers of refurbished tools, since as a general rule, they don't participate at the bleeding edge.
Solar, MEMS and LEDs manufacturers are also participating in the refurbished marketplace and competing for tools with more technically advanced IC makers. Although those end markets may seem red-hot and production tools scarce, the bloated refurbished market is now supplying re-tooled production equipment to satisfy those specialized needs.
Even brand new production fabs are purchasing refurbished. Late vintage era tools (from 2004 models onward) offer state-of-the-art production capability and cover almost all technological advances. If no major options have been added to the tool in the newer generations, the cost-savings of buying refurbished is striking and enticing. Additionally, those hardcore production tools are proving they are workhorses, some expected to be producing wafers for another 15 years or more.
The refurbishing process
The refurbished tool of today bears little resemblance to the used tool from the mid-1990s. Refurbished equipment is now disassembled, worn parts replaced with new, and re-assembled to OEM specs. Aesthetically, the refurbished tool looks like new. Panels, or "skins," are often repainted or polished, and the entire tool is cleaned top to bottom. OEM maintenance schedules are strictly enforced as the refurbisher follows the manufacturer's recommendation for parts replacement. For example, in a typical KLA-Tencor Surfscan particle inspection system, the laser and power supply are replaced. The optics, which do not often deteriorate, are cleaned, adjusted and calibrated. The refurbishment is performed in a cleanroom environment as required for particle inspection equipment. Most end users visit the refurbisher's facility to run wafers for a final acceptance test before the tool is approved for shipment.
Unlike the old days when a used tool would arrive at the shipping dock with little instruction, today's refurbished tool, especially a more complex one such as a mask aligner for example, arrives ready for installation, qualification and training – all provided by the refurbisher.
Software for refurbished equipment remains a sticking point for some buyers. A refurbished tool is delivered with software that is currently running on that generation tool. For the newest software version, the buyer typically has to go to the OEM to purchase a software license or a new tool must be purchased. The key question to ask: is it worth the cost of the new tool to get the latest software? Often, the answer is no. Most customers of refurbished equipment are happy to run with late vintage software on a proven, stable platform that has all the bugs worked out. (It's not much different than software for your PC; if it's a brand new release, it's bound to have bugs.)
SEMI, the global trade industry association, is even getting in on the software debate. In 2008 it purchased SEC/N, the Surplus Equipment Consortium Network, and is coordinating efforts in the secondary equipment market with a special interest group called SESTG (Secondary Equipment, Services and Technology Group; www.semi.org/en/IndustrySegments/SecondaryMarket). Their goals include raising industry standards and driving quality performance, and addressing the software issue, among others.
As the quality and longevity of semiconductor capital equipment has evolved and as fab production demands have stiffened, refurbished equipment has emerged to fill crucial needs within the industry. The quality and attention to detail is way up, the market is flourishing, and device manufacturers of all types are reaping the benefits.
A recent example of a refurbished system provided to an end user was a Karl Suss MA150cc Mask Aligner that had an original purchase price in the range of $500,000–$700,000 USD (depending on configuration). It had a one-year warranty that included installation and training. The lead-time was 4-6 months.
ClassOne was able to refurbish the system with a price in the range of $225,000–$275,000 USD (depending on configuration), a warranty/guarantee of six months, with installation and training included in the purchase price. The lead-time was two months.
All major subassemblies were rebuilt including: mask stage, TSA microscope manipulator, BSA microscope manipulator, wafer transport, cassette elevators, shutter assembly, lamp manipulator, WEC head, and Z-axis. All drive belts, worn switches and kinked tubing (or tubing that moves) were replaced. The lamp house shutter and mirror house cylinders were replaced, along with several lamps and mirrors in the system. The pre-aligner was thoroughly cleaned and lubed; the manipulators were leveled and the microscopes were tested and set up. We ran end user wafers through the system and fine-tuned the handling and sensors to their wafers and set up the AutoAlign program. Finally, we performed a lamp test, a power supply calibration and guaranteed the system to meet original specifications.
The end user received an almost-new mask aligner that had been completely refurbished for half the price of a new machine and delivered in half the time. It was ready to perform on the fab floor to its original specification for many years to come.
1. "Refurbished Semiconductor Equipment Revenue to Rebound in 2010," Gartner, Dataquest Insight, ID #G00172439, p.1.
2. ibid, p. 5.
Byron Exarcos received his BS, industrial engineering from Georgia Tech (Georgia Institute of Technology) and is president of ClassOne Equipment, Inc., 5302 Snapfinger Woods Drive, Atlanta, GA 30035 USA; ph.: 770.808.8708; email email@example.com; http://www.classoneequipment.com