Semiconductor Capital Equipment Market Trends

Growth Drivers

• Emergence of 5G Technology– The Internet of Things, augmented reality, mission-critical services, cloud solutions, and others have benefited from the deployment of 5G networks, which have increased wireless communication, ultrafast speeds, low latency, and high reliability. This is expected to support the growth of the semiconductor capital equipment market over the next few years, with a view to ensuring that equipment and networks operate smoothly. It is estimated that by 2027, the number of 5G subscriptions worldwide will reach 6 billion.
• Growing Trend of Electric and Hybrid Vehicles– Semiconductors are used for different parts and car components, e.g. sensors and microcontrollers, by the vehicle manufacturers of electrical and hybrid vehicles. Therefore, it is estimated that favorable opportunities for market expansion are created by the emergence of electric and hybrid mobility in combination with a requirement to use AI-based automotive systems. The International Energy Agency IEA announced that global sales for electric cars in 2021 have increased to 6.6 million, which means the overall number of electric vehicles on the road now stands at 16.5 million.
• Increased Demand for Semiconductors – semiconductors are part of almost every electronic component including computers, laptops, mobile phones, tablets, TVs, video games, cooking appliances and so on. The value of the semiconductor capital equipment market is projected to be reduced as a result of this factor. The global sales of semiconductors reached approximately USD 620 billion in 2022.
• Increasing Trend Towards Miniaturization- Semiconductor producers are being driven by a trend towards miniaturization and enhanced functionality in electronic devices. They're taking advantage of the latest techniques for manufacturing and are looking into innovative capital equipment.

Challenges

• Shortage of skilled and trained personnel- The main challenge faced by the semiconductor manufacturing sector is a lack of skilled and trained personnel. The retirement of the baby boomers has left a hole in embedded knowledge. The number of experienced personnel available was therefore not sufficient. Baby boomers' retirement and global economic growth have been the main reasons for widening this gap. In the production and operation of complex machines, employees in the semiconductor manufacturing sector do not have any knowledge or skills. Due to the gradual decline of technical training programs in schools, they do not possess essential skills and knowledge in fields such as engineering, mathematics, science, or technology.
• The market for semiconductor capital equipment is particularly affected by the high starting costs of setting up and installation, as a result of constraints on production machine manufacturers and installations.
• The demand for equipment varies due to the variability of the characteristics of the semiconductor industry.