Research company MarketsandMarkets recently published a report noting the semiconductor manufacturing equipment sector will be worth $95.9 billion by 2025. As the group estimates the market is currently worth $62.4 billion, it projects a 53.8 percent rise in value over the next five years.
The organization also covered the factors driving the industry’s growth and identified the region that will see the most expansion.
Consumer Products Demand and Machinery Costs
MarketsandMarkets explained the rising demand for consumer products and the mounting costs of component fabrication tools would drive the semiconductor equipment sector’s robust development.
The firm anticipates rising demand for electric and hybrid vehicles will greatly expand the component manufacturing gear market. Because of the digitized nature of their propulsion systems, next-generation automobiles require more semiconductors than gas-powered cars. As carmakers outfit their new offerings with advanced driver assistance systems and infotainment cockpits, they will need to buy more MCUs and CPUs to administer those features.
MarketsandMarkets’ also states the global expansion of digital infrastructure – meaning artificial intelligence networks and cloud computing – will push the sector’s growth.
The analyst group points out the rising cost of semiconductor manufacturing equipment will contribute to the market’s surging value. Presently, microelectronics companies are striving to produce smaller chipsets with ever-greater transistor density, and energy efficiency. As an example, extreme ultraviolet lithography (EUV) has emerged as the best etching technology to achieve that aim, allowing firms like TSMC to create 5nm nodes. However, ASML, the sole manufacturer of EUV tools, sells its cutting-edge systems for $150 million each.
As semiconductors become more complex, their fabrication equipment becomes more sophisticated and expensive. That spike in manufacturing tools costs will play a big role in expanding the market.
Asia-Pacific, Memory Segment, and Coronavirus Impact
MarketsandMarkets determined the Asia-Pacific region – which includes China, Japan, South Korea, and Taiwan – will have the largest semiconductor production equipment market share by 2025. The firm stated the area’s large concentration of foundries and high demand for consumer electronics would allow it to dominate the sector.
Fortune Business Insights recently reported the Asia-Pacific region would lead the world in semiconductor purchasing, so it’s data accords with MarketsandMarkets’ findings.
The research company predicts the memory segment will see the largest growth rate over the next five years. The group explained the popularization of new technologies like MRAM and ReRAM would spark an upswing in module manufacturing equipment purchasing.
MarketsandMarkets also offered some insights regarding the impact of the coronavirus pandemic on the semiconductor manufacturing equipment sector. The firm predicts the global health crisis will increase machinery sales as companies build new chip research and development facilities. However, the group believes the pandemic will cause a drop in consumer product spending that will restrain the market’s growth.
Despite the pandemic’s lingering impact, the digital transformation trend will seemingly push the semiconductor manufacturing equipment sector to new heights.