Report: Global semiconductor wafer market to reach $12.22 billion by 2024

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Semiconductor industry growth in 2020 report.

British market research firm Technavio recently compiled a forecast on the global semiconductor wafer market through 2024. The group expects the sector to reach $12.22 billion in the next five years on the back of increased digitization.

The organization also predicts the Asian-Pacific region will lead the world in microelectronics manufacturing in the next five years.

Factors Driving Semiconductor Manufacturing Growth

In Technavio’s analysis, the transformation of the consumer electronics segment pushed semiconductor manufacturing growth from 2015 to 2020. The group posits the demand for cutting-edge laptops, LED television sets, and smartphones forced IC makers to develop new output methodologies that prioritized miniaturization, minimal power usage, and enhanced processing capability.

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The organization believes that consumer electronics will still be a key industry growth driver going forward, but so will integrated interconnected systems. The firm predicts the rising popularity of handset-controlled smart home components will expand the semiconductor market. Technavio’s outlook falls in line with Statista’s estimate that the connected living space sector will reach $46.64 billion by 2024.

The analyst group also anticipates spiking medical device usage will be another industry revenue driver. VynZ Research issued a report mirroring its findings, stating that connected health monitors, drug delivery devices, and emergency medical equipment revenue will hit $20 billion by 2024.

Technavio’s forecast also asserts the mainstreaming of Internet of Things (IoT) technology will positively impact worldwide semiconductor fabrication. Currently, firms are using IoT networks to power everything from autonomous manufacturing to self-driving vehicle operation to cashierless retail stores. As such, Technavio’s forecast accords with the major prevailing trends in the microelectronics industry.

Global Production Hub Insights

In 2019, the Asian-Pacific region led the world in semiconductor wafer production followed by North America, Europe, South America, the Middle East, and Africa. Because it is home to manufacturers like Samsung, Sony, and Toyota, Technavio expects it will maintain its ranking through 2024. However, the recent trend of nation-states subsidizing local component manufacturing could upend the group’s analysis.

Recently, China, India, and Taiwan have announced plans to incentivize in-country semiconductor manufacturing with subsidy programs. The cumulative multibillion-dollar investment by those states will undoubtedly increase their local microelectronics production capacity, which backs Technavio’s outlook.

However, other regions have recently announced plans to increase their domestic chip-making capability through direct financial intervention. The New York Times notes Germany and Ireland have launched incentive initiatives to attract semiconductor manufacturers. Similarly, U.S. Senators have proposed two bills calling for a total of $47.8 billion in component supply chain support.

Emerging international interest in establishing local chip-making infrastructure could make North American or Europe the new global semiconductor wafer manufacturing hub. Regardless of how things shake out, Technavio’s forecast that microelectronics production will reach new heights this decade seems inarguable.

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