Lead times for semiconductor equipment components in South Korea are lengthening, with some reaching 40 months. Upstream supply capacity has been unable to keep pace with the surge in AI demand, raising concerns about the impact on investment in semiconductor production infrastructure worldwide.
Supply of key components used in semiconductor equipment in South Korea is facing severe shortages, with lead times for several items now at least twice their previous levels. Reports indicate that lead times for core components sourced from Japan have reached 40 months.
Lead times for deposition equipment components have increased from 4 months to 10 months, while those for components sourced from Japan in the laser processing equipment sector could reach as long as 40 months. Some observers say it will be difficult to begin production unless alternative supply chains can be secured.
Lead times for packaging equipment components made in South Korea have also increased by about 50%, from the normal 4 months to 6 months or more. The explosive growth in AI demand has left upstream component manufacturers unable to expand production capacity, which is cited as one factor behind the shortages.
TSMC has continued to raise its outlook for equipment procurement volumes in 2026, with analysts viewing this as evidence that AI demand is translating into increased production of advanced-process chips. Cleanroom orders in China are being closely watched as a leading indicator, suggesting an expansion in domestic demand for semiconductor equipment.