The global compound semiconductor packaging market size was valued at USD 15,690.01 million in 2022. It is expected to reach USD 38,537.72 million by 2031, growing at a CAGR of 10.50% during the forecast period (2023–2031).
A compound semiconductor is created using deposition technologies and comprises elements from two or more periodic table groups. Since semiconductors have special qualities like a wide band gap, high operating temperatures, high current and voltage holding capacity, and the capacity to produce microwave signals, they are crucial parts of most electronic circuits. Compound semiconductors are created when layers of two or more elements with thicknesses ranging from several nanometers to micrometers are laminated. Each layer uses a different combination of elements. According to the properties of the material, the wafer process varies. In addition, some CS devices have delicate air bridges, gold bond pads, topographical cavities and trenches, and other bulk material characteristics that are delicate to conventional packaging techniques' mechanical and chemical processes. The performance and efficiency of the new semiconductor components are now thus limited by conventional electronics packaging and interconnection technologies.
Manufacturers are putting more of an emphasis on offering compact electronic devices in a variety of verticals, including consumer electronics, healthcare, automotive, and semiconductor integrated circuit manufacturing. To ensure precise patterning on the wafers and chips, these manufacturers are shrinking the size of the integrated circuits. Additionally, the market for medical devices is witnessing an increase in demand for the sophisticated, wearable, and customized healthcare technology, including nano-sized robotic surgery equipment. As a result, designers now need to move beyond traditional packaging methods and adopt advanced compound semiconductor packaging due to the trends toward smaller electronic devices.
Due to the increase in demand for high-performance electronics, the semiconductor industry is seeing growth in miniaturized electronic devices. The advancement of technologies like RFID, MEMS, and other power devices also increases the demand for thin wafers. A significant need for miniature electronic devices is generated by new applications in semiconductor technology, which also contribute to the expansion of the advanced packaging market for compound semiconductors globally. These applications make use of a very thin and ultra-thin die.
Wafers are now an essential production component because they use automation to boost productivity and accuracy. To control the entire process and make it easier through automation, compound semiconductor wafers are used to monitor various parameters, including temperature, pressure, flow, level, and other parameters. Additionally, a rise in production rates in the automotive sector, where electric and self-driving cars and trucks will contribute significantly, is anticipated to significantly impact the compound semiconductor packaging market. Wafers made of compound semiconductors are widely used in automobiles for various purposes, including collision detection, infotainment, and navigation. Global growth in the packaging market for compound semiconductors is anticipated to be aided by the automotive industry's steady transformation from traditional designs to driverless and smart cars.
Compared to traditional packaging methods used in the semiconductor industry, compound semiconductor packaging technology is costly. At some levels, the cost of designing and producing chips for each new node is high. Additionally, because of the complexity of the ICs, wafer fabrication is much more expensive. Packaging various chips and integrated circuits with intricate patterns hampers the adoption of advanced compound semiconductor packaging. The semiconductor industry finds compound semiconductor packaging very viable due to its many features, including easy and wider interconnections for chips and wafers and the availability of heterogeneous integration. However, because these features are readily available, compound semiconductor packaging is more expensive than conventional packaging, which makes it challenging for small manufacturers to adopt this technology. As a result, a significant inhibitor to the growth of the compound semiconductor packaging market globally is the high cost associated with advanced packaging solutions for compound semiconductors.
It is anticipated that a variety of novel materials, such as superconductors, carbon nanotubes, and compound semiconductors like GaN, will be used to create next-generation smart technologies. A smart grid and infrastructure must include new cable types, power electronics, cable insulators, cable dielectrics, and energy storage devices. As the market matures, an increase in these technologies is anticipated to fuel demand for GaN and other compound semiconductors. Incorporating advanced compound semiconductor devices and modules is also expected to encourage new smart infrastructure efficiencies, such as enhancing power quality and equipment lifespan, lowering costs, and improving power system control and reliability. Therefore, the growth of the packaging market for compound semiconductors is anticipated to present a lucrative opportunity due to the development of smart technologies.
The global compound semiconductor packaging market is segmented by packing platform, application, and end-use.
Based on the packing platform, the global compound semiconductor packaging market is bifurcated into the flip chip, embedded die, fan-in WLP, and fan-out WLP.
The flip-chip segment is the highest contributor to the market and is expected to grow at a CAGR of 9.8% during the forecast period.A chip scale package (CSP) solution is a flip chip. A flip chip attaches semiconductor components, like MEMS and ICs, to external circuitry. Flip chip CSP is smaller than other products because wire bonding is unnecessary. Compared to direct chip attachment or chip on board, it offers better chip protection and improved solder joint reliability and is used for all mobile applications (COB). The Flip Chip CSP is the best kind of modern compound semiconductor packaging.
Compared to more conventional packaging methods, the compound semiconductor packaging type offers relatively thin, compact, and lightweight packages. Most applications, including RFICs and memory ICs, use flip chips. Additionally, this package type is employed for GPS, cellular phones, PC peripherals, camcorders, and digital cameras. Increased demand for circuit miniaturization, the growing popularity of the Internet of Things (IoT), and technological advancements in wire bonding are the main factors driving the growth of the flip chip.
Fan-out wafer-level packaging is an improvement over traditional packaging for integrated circuits. It was created so that a silicon die could have more external contacts. Fan-out WLP is a more reliable manufacturing process that does not have the size restrictions of a typical die. Due to its significant technical advantages, which have prompted its extensive commercialization, it is anticipated to be one of the most profitable compound semiconductor packaging technologies and to gain prominence in the market. In place of mold compound, the popular packaging method known as "fan-out wafer level packaging" is used to construct packages with die embedded in materials such as organic laminate or compound semiconductor wafer.
Based on the application, the global compound semiconductor packaging market is bifurcated into CS power electronics, CS RF/microwave, CS photonics, CS sensing, and CS quantum.
The CS power electronics segment owns the highest market share and is expected to grow at a CAGR of 9% during the forecast period.The use of solid-state electronics in converting and controlling electric power is known as power electronics. Both switches and amplifiers can be made of power electronic devices. Due to operational efficiencies, power electronics companies implement compound semiconductor packaging in their products and modules. Compound semiconductor packaging is used to create a variety of solid-state power electronic devices that can regulate output parameters like voltage, current, and frequency. Most electronic systems must have devices made of compound semiconductor wafers.
Compound semiconductors like SiC and GaN are also increasingly necessary for high-voltage power electronics because of the rising demand for effective energy management in products like solar inverters and hybrid cars. As wide bandgap technologies become more prevalent in the power electronics industry, substrate suppliers have made significant advancements toward optimizing SiC or GaN wafers, boosting the market's growth internationally.
The wavelengths of microwave radiation, a type of electromagnetic radiation, range from 1 m to 1 mm, and their frequencies range from 300 MHz to 300 GHz. Microwave technologies are being used and recognized in more radar and communications applications. The development of potent transmitter and low-noise amplifier semiconductor devices benefits from compound semiconductor packaging technology. In addition, the performance and dependability of high-power microwave devices are determined by the design and quality of the AlGaN GaN used in those devices. Due to their quick processing, which is profitable for market expansion, electronic circuits utilizing III-V compound semiconductor devices and modules have been used extensively in RF components and systems in the microwave ranges in recent years.
Based on the end-use, the global compound semiconductor packaging market is bifurcated into the digital economy, industrial and energy and power, defense/security, transport, consumer electronics, and space.
The transport segment is the highest contributor to the market and is expected to grow at a CAGR of 8.6% during the forecast period.Electric and hybrid vehicles both use a lot of compound semiconductor power devices. There are two different types of GaN power devices on the market, lateral and vertical GaN power devices; both designed for use in the transportation sector. Compared to Si-power MOSFETS, lateral GaN power devices are more commonly used due to their higher blocking voltage of 600 volts, improved performance characteristics, low internal resistance, and high-speed resonance. Compound semiconductors are primarily used in voltage regulators, fuel injectors, mass airflow and pressure sensors, ignition control units, electric spark controllers, antilock brakes, and engine control units in the automotive and transportation industries. The automobile sector may use the flip chip in a larger range of applications due to its small size, enhanced functionality, high reliability, low cost, and superior thermal characteristics.
In recent years, conventional silicon-based power diodes and transistors have been used in energy and power and industrial systems. The packaging technology for compound semiconductors is better suited to managing electrical loads, switching rates, and other performance requirements necessary to cut down on energy losses and lower system costs overall. For use in offline power supplies, home electronics, hybrid and electric vehicles, and smart grid systems, the development of SiC and GaN power electronic devices is actively pursued.
China Dominates the Global Market
The global compound semiconductor packaging market is segmented into the US, the UK, China, and the Rest of the World.
China is the most significant shareholder in the global compound semiconductor packaging market and is expected to grow at a CAGR of 9.5% during the forecast period. China's semiconductor industry heavily relies on foreign technology to fuel its rapidly expanding economy, importing 90% of its chips. Electronics make up the most significant portion of the consumer market in China, which is also one of the largest producers of personal electronics equipment. Over the next ten years, it is anticipated that this will continue to hold a dominant position. Moreover, given that significant players are introducing cutting-edge compound semiconductor packaging technology, the existence of electronics manufacturing facilities in China is anticipated to contribute to growth rates during the forecasted opportunities. Therefore, all of these investments and innovations are expected to fuel the expansion of the compound semiconductor packaging market.
The U.S. is expected to grow at a CAGR of 10.6% during the forecast period. Although the U.S. semiconductor industry has state-of-the-art research and development facilities because of the presence of global giants, the growth of the U.S. compound semiconductor packaging market is predicted to be slow. The market has also seen significant spending on R&D facilities and cooperation from the major players, making it the second-largest contributor to the packaging market for compound semiconductors.
Significant public and private investments have been made in the South Wales compound semiconductor cluster. In the U.K., more than 5,000 businesses produce electronic systems, and many create goods that will likely utilize compound semiconductors in the future. Additionally, consumers and luxury car manufacturers are concentrated in the U.K. This increases the need for sophisticated electronic components in engine control units and other infotainments, fueling the U.K. market for compound semiconductor packaging.
Other nations, including Taiwan, Korea, Germany, and others, also hold a sizable portion of the market for compound semiconductor packaging. Governments in many nations support efforts to use compound semiconductors in various applications. German OEMs are in charge of producing 40% of all premium automobiles sold worldwide and 70% of all premium cars produced globally. According to the Federal Statistical Office, Germany is expected to be the leading nation in automotive electronics, growing at 5.9% annually. Therefore, this development in the auto sector encourages the use of microelectronics in the nation and consequently generates lucrative growth opportunities for the compound semiconductor packaging market in Germany.
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