We ponder the state of the ASEAN semiconductor market in broad strokes
This article was initially published as the foreword to the EET Recommend e-book.
TAIPEI — With records of all sorts being broken in the semiconductor industry in 2017, the signs for the end of the decade are promising. The top ten semiconductor R&D spenders padded their budgets with 6 percent on average compared to 2016. DRAM and NAND demand, as well as price, skyrocketed, enabling the semiconductor industry as a whole break $400 billion for the first time. With demand looking unlikely to diminish anytime soon, the major players in this industry are ramping up their production capability, with wafer capacities projected to grow by 8 percent per annum in 2018 and 2019.
On the vehicle front, 2030 looks set to be a target year for governments that mean business, and business of course means phasing out fossil-fueled vehicles. With development cycles of around five years not uncommon in the world of passenger cars, it’s a good thing that the ball is already rolling. Component suppliers are welcoming the push for autonomous vehicles, with a flurry of activity in ADAS development seeing new solutions and market actors being announced almost weekly, as are new AI and machine learning chips.
Elsewhere in the supply chain, car giants are fighting with consumer electronics manufacturers over cobalt contracts of their own to ensure an adequate supply of raw materials for their battery packs. With the raw material having tripled in price in the last eighteen months, developments are sure to make their mark on EVs, as they command closer to ten kilograms of cobalt per finished product, whereas a typical smartphone battery requires less than ten grams. The gist of it is that revenues are yet again on the rise, as cobalt is absolutely essential. “Cobalt prices are unstable due to speculators on the market, but we’re not going to let that stop us,” commented a battery solutions director for a vehicle manufacturer EE Times spoke to.
Everywhere you look, ten-, eleven- and occasionally even twelve-figure USD sums are being invested, offered, turned down, and as if to spice things up, fines of the same magnitude are being issued. In other words, records are being set left, right and center, and Asia is where the main developments happen. While Japan, Korea and Taiwan are meandering on their traditional paths in semiconductors, China is aiming to cut itself a piece of the world market by means of colossal state investment funds earmarked for stimulating its national production of ICs.
In spite of all this progress, Asia is still an emerging market with huge growth potential for the foreseeable future. Electric vehicles, industrial automation, IoT products, security systems and drones will continue to drive the market forward, with strong regional demand among both consumers as well as in the manufacturing sector.
Thanks to the rapid development of IoT and wireless control industry, the demand of RF ICs are on the rise. Taiwan-based IC design house Holtek Semiconductor highlights continuous improvement of IC technology, enabling ever-increasing RF transmission efficiency, at reduced power consumption. Main developments in low-power wireless are mainly happening at the sub-1GHz and 2.4GHz, as driven by IoT applications.
Another RF IC supplier, AMICCOM, indicates that sub-1GHz RF ICs have very low power consumption on the receiver side, making it especially suitable for electronic toll collection and smart metering where wired power often isn’t available. Furthermore, the 2.4GHz technology can pair low power consumption with long transmission range, making it suitable for applications such as remote controls, toys, helicopters, drones, wireless audio, as well as home automation and security products.
Lastly, we’ve had a word with Mouser, distributor of all things electronics. It is obviously in a quite unique position to give us an insight of the Asian markets and especially strong growth is seen in Singapore, Thailand and Malaysia, with over 60% growth each over the last year. Looking forward, Mouser is aiming to increase its head count in Asia, to “provide more localized service by region and deepen our engagement with manufacturers,” it commented in a written statement.
All stats and data point toward strong continued growth on the Asian markets, and we’re of course excited to be part of the coverage on your behalf. Perhaps fittingly, we can round off this article with one final quote to sum up the general picture of the market, yet again from the Texan giant distributors Mouser: “APAC accounts for 24% of our global business. We expect to see [even] stronger growth in the following years.”