Ottawa, Nov. 23, 2023 (GLOBE NEWSWIRE) -- The global semiconductor packaging market size accounted for USD 30.14 billion in 2023 and is expected to reach around USD 50.13 billion by 2029, According to Precedence Research. Asia-Pacific led the global market with the largest market share of 33% in 2022.
Integrated circuits (ICs) or chips are enclosed in a protective shell during semiconductor packaging to ensure their usability, durability, and handling. Surface mount technology (SMT), classic leaded packages, ball grid arrays (BGA), chip scale packages (CSP), and system-in-packages (SiP) are only a few of the advanced packaging methods used in the semiconductor industry. Packaging solutions for semiconductor components offer improved security features, such as tamper resistance and secure key storage, are going to be essential as the relevance of cybersecurity grows, particularly for applications like automotive electronics and IoT devices.
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It is anticipated that advanced packaging techniques, including through-silicon via (TSV), fan-out wafer-level packaging (FOWLP), and fan-in wafer-level packaging (FIWLP) will receive more attention while accelerating the growth of the market. Higher performance, smaller form factors, and better power efficiency are all features of these technologies.
Key Insights:
- By Type, the flip chip segment contributed the largest market share in 2022.
- By Packaging material, the organic substrate segment held the highest revenue share in 2022.
- By Technology, the grid array segment has held the biggest revenue share in 2022.
- By End-user, the consumer electronics segment held the major market share in 2022.
Regional Stance:
The Asia Pacific semiconductor packaging market size surpassed USD 9.17 billion in 2022 and is projected to reach around USD 22.2 billion by 2032, expanding at a CAGR of 9.3% between 2023 and 2032.
Asia Pacific had the largest revenue share in 2022 and is expected to dominate in the semiconductor packaging market throughout the predicted timeframe. Nations such as China, Taiwan, South Korea, and Singapore, Asia Pacific has made a name for itself as the center of semiconductor manufacturing worldwide. These nations have invested significantly in skilled people, advanced technology, and infrastructure, resulting in an environment supporting the semiconductor supply chain. Asia is home to some of the world's biggest and most technologically advanced semiconductor firms, including TSMC (Taiwan Semiconductor Manufacturing Company), Samsung, and SK Hynix. These businesses are leading the way in semiconductor packaging technology, encouraging innovation, and establishing benchmarks for the sector.
Asia Pacific has established specialized clusters for semiconductor production. One of the most significant semiconductor research and development facilities in the world, for instance, is located at Taiwan's Hsinchu Science Park. The sheer amount of semiconductor production in the Asia Pacific enables economies of scale, which benefits local producers by lowering costs. Asia Pacific nations invest significantly in semiconductor technology research and development, promoting innovation and maintaining the area at the forefront of packaging methods and materials.
North America is the Fastest Growing Market
Leading regional semiconductor businesses, research institutions, and startups have made North America a hotspot for technological innovation, which has sparked the creation of cutting-edge packaging methods.
To remain competitive in the market, the region has a history of making significant investments in R&D for semiconductor technology, which involves the study of packaging methods, materials, and integration procedures. It even features a thriving ecosystem of research facilities, equipment manufacturers, semiconductor companies, and design studios. New packaging solutions may be developed and implemented quickly in this collaborative setting, which also speeds up innovation.
More complex semiconductor packaging solutions are required due to the rising demand for high-tech electronics such as smartphones, IoT devices, automotive electronics, and data center equipment. To meet these needs, North American businesses have been leading the way. Particularly in the wake of global supply chain disruptions, the significance of a strong and resilient semiconductor supply chain has come to light. Businesses in North America have made investments in plans to improve their supply chain capabilities.
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Report Highlights:
By Type, the flip chip segment is expected to hold the leading position in the market during the forecast period. In comparison to wire bonding, flip-chip technology can produce higher input/output connections. This is crucial for applications like microprocessors that demand numerous references. With flip-chip technology, many chips on a wafer can be produced concurrently, increasing manufacturing throughput and lowering costs. The integration of cutting-edge technologies like 2.5D and 3D packaging, in which several chips or dies are stacked vertically to improve functionality and performance, is well suited for flip chip technology. The adaptability of flip-chip packaging has been further increased by the development of numerous bumping methods, including solder bumps and copper pillars.
By Packaging Material, the organic substrate segment is expected to dominate in the semiconductor packaging market during the forecast period. Organic substrates can be produced using tried-and-true techniques, including lamination and etching. The popularity of these procedures can be attributed to the fact that they are well-known and frequently employed in the electronics sector. High-volume production is well suited for the manufacturing processes utilized for organic substrates. Meeting the demands of the consumer electronics market and other high-volume markets depends on this. It is possible to engineer organic substrates with strong thermal conductivity, which is essential for removing heat from semiconductor devices. They can meet the thermal demands of numerous semiconductor packages even though they might not be as thermally efficient as ceramics. In applications where weight is an issue, organic substrates are frequently lighter than their ceramic counterparts, which might be essential. They might also be thinner, resulting in a smaller package overall.
By Technology, the grid array segment is expected to be dominating in the semiconductor packaging market during the forecast period. Packages for grid arrays are renowned for their small size and effective utilization of available space. This is crucial in applications with stringent size requirements, such as those for mobile, wearable, and Internet of Things (IoT) devices. Grid array package manufacturing processes have improved over time. Higher manufacturing yields, as a result, have reduced costs as compared to other packaging technologies. Thermal control is made more accessible by grid array packages.
In high-power applications such as processors and GPUs, efficient heat dissipation is essential, and this is made possible by the pins' proximity to the package body. Flip-chip technology, in which the semiconductor die is put face-down on the substrate, is used in many grid array packages. Shorter connecting lengths and lower inductance are two benefits of this arrangement, which enhance performance.
By End-user, the consumer electronics segment shows a dominant position in the semiconductor packaging market during the predicted period. Quick technological breakthroughs characterize the consumer electronics sector. As a result, there is a continuing need for more compact, quick, and effective chips. Because of semiconductor packaging, these cutting-edge chips may be included in small devices. Consumer electronics, particularly mobile ones like cell phones, require energy-efficient parts.
Advanced packaging technologies make better power efficiency and temperature management possible, which are essential for extending battery life and maintaining dependable performance. Consumer electronics are becoming more intelligent and linked with the introduction of technologies such as 5G, IoT (Internet of Things), and AI. This necessitates using specialized semiconductor packaging techniques to meet the requirements of high-speed data processing and transmission.
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Semiconductor Packaging Market Scope
| Report Coverage | Details | |
| Global Market Size in 2023 | USD 30.14 Billion | |
| Asia Pacific Market Size in 2023 | USD 9.97 Billion | |
| Global Market Size by 2032 | USD 65.46 Billion | |
| Asia Pacific Market Size by 2032 | USD 22.2 Billion | |
| Growth Rate from 2023 to 2032 | CAGR 9% | |
| Asia Pacific Share in 2022 | 33 | % |
Market Dynamics
Driver
- Increasing complexity of semiconductor devices
Manufacturers can fit more transistors onto a single chip as semiconductor technology develops, resulting in better levels of integration and capability in a smaller footprint. These developments allow for more robust and adaptable electronic devices, ranging from cell phones to sophisticated computing systems. Modern packaging methods can accommodate larger memory capacities. This is essential for applications that require a lot of data, such as cloud computing, machine learning, and high-performance computing. Modern materials and packaging methods have been created due to the desire for greater complexity. For instance, multi-component integration in a vertical stack is made possible by 3D packaging technologies, including through-silicon vias (TSVs) and interposer-based designs, which improve functionality and performance.
Restraint
- Cost and complexity
As semiconductor technology develops, packing complexity rises. More sophisticated nodes need packaging with more layers and finer pitch interconnects, which raises the cost of packaging by requiring expensive materials and equipment. It is crucial to guarantee the dependability and quality of packed semiconductor devices. This calls for highly technical testing methods and tools. Due to more incredible inventory holding costs and potential losses from manufacturing delays, delays or disruptions in the supply chain might result in increased expenses. Reliable packaging requires high-quality components, including die-attached materials and sophisticated substrate interconnects.
These materials frequently have high price tags, which raises the entire cost. Expensive research & development is required to create cutting-edge packaging solutions, which also involves creating new tools, processes, and materials. Product sales must cover these expenses, which may result in price increases.
Opportunity
- Growth in automotive electronics
Advanced driver assistance systems (ADAS), infotainment, engine control units (ECUs), and other electronic technologies are standard in modern automobiles. This complexity calls for various semiconductor components designed for a particular purpose. Safety is of utmost importance in the automotive sector, including electronics. Semiconductor packing technologies must adhere to rigid reliability standards for vital systems such as airbags, ABS, and electronic stability control to operate reliably and without error. Solutions for semiconductor packaging that strike a balance between effectiveness, cost, and efficiency is highly desired. Manufacturers are interested in solutions that maximize available space, reduce energy use, and are profitable for mass manufacturing.
Compact and finely integrated electronic components are becoming increasingly necessary as automakers work to make cars more effective, lighter, and svelte. To achieve downsizing while assuring dependable performance, semiconductor packaging is essential. Higher degrees of integration and implementation are made possible by advancements in semiconductor packaging techniques such as improved materials, 3D packaging, and system-in-package (SiP) technologies. These developments make it possible to produce more advanced automotive electronics.
Challenge
- Regulatory and environmental concerns
Selecting suitable packing materials is essential for tackling environmental issues. Companies are pressured to choose materials that adhere to legal requirements and have a minimal negative environmental impact during their entire lifecycle, from manufacturing to disposal. Due to lead's detrimental effect on the environment and human health, numerous nations have adopted rules banning its use in electronic equipment. The creation of lead-free packaging materials and procedures has become necessary.
In the production of semiconductors, energy consumption is a primary concern. Semiconductor packing demands a significant amount of energy. To lessen their influence on the environment, manufacturers are under pressure to adopt more energy-efficient processes and technologies. Adhering to strict environmental and regulatory norms frequently takes a sizable investment in research, development, and compliance mechanisms. Due to higher production costs, semiconductor packaging companies' ability to compete may be harmed.
Related Reports:
- Advanced Packaging Market: The global advanced packaging market size surpassed USD 31 billion in 2022 and is expected to hit around USD 68.49 billion by 2032, poised to grow at a CAGR of 8.30% during the forecast period from 2023 to 2032.
- Packaging Coatings Market: The global packaging coatings market size was estimated at USD 4.8 billion in 2022 and is expected to reach USD 7.86 billion by 2032, poised to grow at a noteworthy CAGR of 5.1% from 2023 to 2032.
- Packaging Barrier Films Market: The global packaging barrier films market size reached USD 25.8 billion in 2022 and is expected to hit around USD 36.57 billion by 2032, expanding at a CAGR of 3.6% during the forecast period from 2023 to 2032.
Recent Developments
- In January 2023, Grinding and Akoustis Technologies, Inc bought Dicing Services, Inc. (GDSI). The purchase of GDSI by Akoustis is anticipated to aid in the company's plan to repackage and export its XBAW filters to the US and its upcoming application for funding through the CHIPS and Science Act.
- In January 2022, Klockner Pentaplast (kp), a pioneer in recycled content products and high-barrier protective packaging, announced its intention to increase its post-consumer reused (PCR) PET capacity in North America to broaden its sustainable innovation providing in the consumer health, drugs, and food packaging markets.
Market Key Players:
- Amkor Technology
- Powertech Technology Inc.
- Intel Corporation
- ASE Group
- Jiangsu Changjiang Electronics Technology Co. LTD
- Samsung Electronics Co. Ltd.
- ChipMOS Technologies Inc.
- Taiwan Semiconductor Manufacturing Company
- Texas Instruments
- Fujitsu Limited
Market Segmentation:
By Type
- Flip Chip
- Embedded Die
- Fan-in Wafer Level Packaging (FI-WLP)
- Fan-out Wafer Level Packaging (FO-WLP)
By Packaging Material
- Organic Substrate
- Leadframe
- Bonding Wire
- Ceramic Package
- Die Attach Material
By Technology
- Grid Array
- Small Outline Package
- Flat- No Lead Package
- Dual In-Line Package
- Ceramic Dual In-Line Package
By End-User
- Consumer Electronics
- Communications and Telecom
- Automotive Industry
- Aerospace and Defense
- Medical Devices
- Energy and Lighting
By Geography
- North America
- Europe
- Asia-Pacific
- Latin America
- Middle East and Africa
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