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The semiconductor chip packaging market size is estimated to grow by USD 993.4 billion at a CAGR of 37.32% between 2023 and 2028. The market is experiencing significant growth, driven by several key factors. Firstly, there is considerable investments in advanced fabrication facilities to meet the increasing demand for miniaturized and high-performance electronic devices. Additionally, there is a trend towards lower technology nodes, which necessitates the use of advanced packaging solutions to ensure reliable and efficient chip performance. However, the high initial investment required for setting up packaging facilities and the complexities involved in the packaging process pose challenges for market players. Despite these challenges, the market is expected to grow at a steady pace due to the increasing demand for advanced electronic devices and the continuous miniaturization of semiconductor chips. Overall, the semiconductor chip packaging market presents significant opportunities for growth, driven by technological advancements and increasing demand for high-performance electronic devices.
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The market is a critical sector in the electronics industry, focusing on the design, development, and production of semiconductor packages. These packages protect and connect advanced semiconductor components to various substrates and interconnects, enabling the functionality of consumer electronics, automotive electronics, and advanced computing systems. Key applications include consumer electronics such as smartphones and tablets, electric vehicles, autonomous driving, advanced packaging for high frequency applications, high performance computing, data processing, and Internet of Things devices. Advanced packaging techniques like flip chip, wafer level packaging, and 3D packaging are used to enhance power densities, signal integrity, thermal management, and mechanical support. Materials like leadframes, encapsulation resins, and display technologies play a crucial role in semiconductor packaging. The market is driven by the increasing demand for advanced semiconductor components in various applications, including artificial intelligence, autonomous driving, laptops, smartwatches, and sensor technologies. Electrical insulation and mechanical support are essential considerations for packaging materials to ensure optimal performance and reliability. Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The growing investment in fabrication facilities is a major factor driving the global market share growth. Memory device manufacturers such as Samsung Electronics, Western Digital, Micron Technology, Toshiba, SK Hynix, and Intel are investing in new manufacturing facilities to increase production capacity to remain competitive in the market.
Moreover, the growing demand for 3D NAND has created opportunities for supply chain members such as chip makers, integrated circuits (ICs), device makers and material suppliers. This is driving investment in 3D NAND manufacturing equipment. Hence, such factors are driving the market during the forecast period.
The growing investments in lower technology node is another factor supporting the global market share growth. As demand for low-power and high-performance semiconductors increases, semiconductor foundries and IDMs are investing in R&D to identify new technologies that can support production on lower technology nodes. Semiconductor manufacturers are trying to reduce the size of semiconductor nodes to achieve high performance, high scalability, and low production costs. These reductions follow Moore's Law, which states that the number of transistors in an integrated circuit doubles every two years.
Hence, semiconductor manufacturers are implementing different technologies such as Fin Field Effect Transistor (FinFET) and Fully Depleted Silicon on Insulator (FD-SOI) to realize the production of ICs based on lower technology nodes. Market players are investing in the establishment of new fab due to the growing adoption of lower technology nodes. The growing investment in fabrication facilities to support the production of ICs built on lower technology nodes is driving the demand for semiconductor chip packaging specifically designed for semiconductor wafers. Hence, such factors are driving the market during the forecast period.
The high initial investment will be a major challenge for the global market share growth during the forecast period. The growing demand for compact ICs and the emergence of new 3D packaging solutions such as TSV, stacked packages, and MEMS packages have changed the semiconductor IC manufacturing process. Manufacturers must invest heavily in manufacturing equipment to produce compact ICs. Furthermore, the manufacturing process is complex, consumes more time, and has a high chance of defects, leading to an increase in the cost of manufacturing.
The rapid technological change in the semiconductor industry is compelling companies to opt for efficient equipment, which increases the total cost of ownership of the equipment. Therefore, many companies are going fabless, which is reducing the number of potential customers for semiconductor chip packaging companies, thereby hampering the growth of the market during the forecast period.
The report includes the adoption lifecycle of the market, covering from the innovator's stage to the laggard's stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
3M Co.: The company offers semiconductor chip packaging such as 3M Heat Resistive Polyimide Tapes which are specially formulated for different high-temperature and chemical processes.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market share growth by the 3DIC TSV stacks segment will be significant during the forecast period. The popularity of TSV platforms is pushed by the growing need to increase functionalities, performance, and integration. Form factors and cost reduction also play an important part in the adoption of the TSV platform.
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The 3DIC TSV stacks segment was valued at USD 83.10 billion in 2018. 3D TSV technology is becoming an important solution platform for high-end memory applications, heterogeneous interconnection with CIS, MEMS, sensors, RF filters, and power applications. In the future, this technology will be used for applications such as photonics and the integration of LED functionality. The 3DIC TSV stack technology segment is expected to be the leading technology during the forecast period, growing at the fastest rate from 2024 to 2028. Based on these factors, the demand for 3DIC TSV stack technology is likely to increase, which can be expected to drive the growth of the featured market during the forecast period.
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APAC is estimated to contribute 78% to the growth of the global market during the forecast period. Technavio's analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The high quantity of raw materials and the low establishment and labor costs have helped companies launch their manufacturing units in APAC. China and Japan are the leading countries driving the growth of the market in the region. China has a rapidly growing smartphone market, and because of miniaturization, the demand for smartphones is expected to grow significantly. These factors are increasing the demand for semiconductor ICs, which is driving the regional market during the forecast period.
The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments.
Semiconductor packaging refers to the process of protecting and connecting semiconductor devices to various components and systems. This market encompasses various types of packaging, including advanced packaging techniques such as System in Package (SiP), miniaturization, 3D packaging, and organic substrates. The semiconductor packaging market is driven by the growing demand for consumer electronics, particularly smartphones and tablets. Additionally, the rise of electric vehicles, autonomous driving, and the Internet of Things (IoT) is fueling the market's growth. Advanced packaging technologies, such as Advanced Encapsulation Resins, Bonding Wire, Ceramic Packages, and Die Attach materials, are essential for high-performance applications in areas like artificial intelligence, high frequency applications, high performance computing, data processing, and telecommunications. Advanced packaging techniques also play a crucial role in automotive electronics, including advanced driver assistance systems, infotainment systems, and chip designs using FinFET transistors and Heterogeneous integration. The market is further fuelled by the need for thermal management, signal integrity, and power densities in various industries, including Aerospace and Defense, Production Linked Incentive, and Smart Manufacturing.
Market Scope |
|
Report Coverage |
Details |
Page number |
183 |
Base year |
2023 |
Historic period |
2018 - 2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 37.32% |
Market growth 2024-2028 |
USD 993.4 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
28.07 |
Regional analysis |
APAC, North America, Europe, South America, and Middle East and Africa |
Performing market contribution |
APAC at 78% |
Key countries |
China, US, Taiwan, Japan, and South Korea |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
3M Co., Amkor Technology Inc., Applied Materials Inc., ASE Technology Holding Co. Ltd., ASMPT Ltd., ChipMOS TECHNOLOGIES INC., GlobalFoundaries Inc., Jiangsu Changdian Technology Co. Ltd., Kulicke and Soffa Industries Inc., Microchip Technology Inc., nepes Corp., Powertech Technology Inc., Skywater Technology, SUSS MICROTEC SE, Taiwan Semiconductor Manufacturing Co. Ltd., Tokyo Electron Ltd., Unisem M Berhad, UTAC Holdings Ltd., and Veeco Instruments Inc. |
Market dynamics |
Parent market analysis, Market forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, Market growth and Forecasting, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the market forecast period. |
Customization purview |
If our market report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements. Get in touch
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Packaging
7 Market Segmentation by End-user
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Opportunity/Restraints
11 Competitive Landscape
12 Competitive Analysis
13 Appendix
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