Market Trends of Standard Logic IC Industry
This section covers the major market trends shaping the Standard Logic IC Market according to our research experts:
Automotive Industry to Generate the Maximum Demand
- The automotive industry is looking forward to wide-scale electrification and advancements regularly. The introduction of smart connected tech and autonomous features is driving the demand for the implementation of semiconductors. Hence, the increased use of circuitry, MPUs, and sensors directs the increased deployment of standard logic ICs for power regulation and rectification.
- The new-age technology catering to safety and modification of ride dynamics is aggressively increasing the use of semiconductors in passenger vehicles. To meet safety norms like airbags, autonomous features, electronic stability control (ESC) programs, and others, companies follow strict regulations on circuit level and use one of the best logic ICs available. For instance, companies like Texas Instruments (TI) offers automotive logic devices compliant with the AEC-Q100 standard. The ICs support a wide range of supply voltages, ranging between 5V and 1.2V, to meet the requirements of any automotive system, including infotainment systems, body control modules, automotive lighting, and advanced driver assistance systems (ADAS).
- IoT Services and remote access features like geofencing, telematics, fleet management systems, autonomous and semiautonomous driving assists, in-vehicle infotainment, and other SIM-based utilities are taking the automotive sector towards dense application of communication. This encourages the deployment of communication modules and more sensors to provide detailed schematic input parameters for further processing. The modules and sensors are extensively using logic ICs to maintain electrical safety standards and power efficiency, especially in electric vehicles.
- As the world is shifting toward Electric Vehicles (EVs), the requirement of extensive regulation of electrical parameters invites logic gate ICs for safer implementation of the charging and discharging technologies. Automotive companies utilize the potential and wide range of voltage handling capabilities of logic ICs through the vehicles' and final deployment stages and charging infrastructure. These factors drive the innovation and advancement in the standard logic IC industry to optimize power consumption, operating voltages, and scaling properties.
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Asia Pacific Region to Drive the Market Growth
- Some of Asia's biggest manufacturing hubs include China, Taiwan, South Korea, and Japan. The availability of a cheaper skilled workforce, favorable weather conditions, government incentives, robust power, and water infrastructure, transportation and logistics, and attractive investment conditions help the semiconductor fabrication industries flourish. These industries contribute significantly to standard manufacturing logic ICs and storage devices.
- According to the 2021 State of the U.S. Semiconductor industry provided by the Semiconductor Industry Association (SIA), about 75% of the world's total semiconductor manufacturing capacity lies in East Asia. The currently operating manufacturing units have 7 nm and below leading-edge capabilities. The current market conditions promise the region's overall domination to continue rising over the forecast period. Major credit for this high rate of development goes to the significant government incentives that significantly bring down the Total Cost of Operation (TCO) compared to the alternate locations.
- According to SIA, Taiwanese firms founded the foundry model in the late 1980s and 1990s. These units specialized in manufacturing the chips designed by firms from other regions. Today Taiwan comprises two of the five largest foundries globally, hosting 20% of the total global capacity. TSMC is one of the three firms, along with Intel (US) and Samsung (South Korea), that can produce logic chips in advanced nodes (10 nanometers or below). These advanced logic chips are deployed in compute-intensive devices like PCs, data center/AI servers, and smartphones. Most of the world's capacity in the top nodes (5 and 7 nanometers) is located in Taiwan.
- The high concentration of the materials required for semiconductor manufacturing like photoresists, silicon wafers, chemicals including packaging substrates, or specialty gases also defines the location of manufacturing logic ICs. For instance, C4F6 is required for the etching process, enabling the process completion 30% faster than the closest alternative. Asian countries, especially Taiwan, have figured out such factors. It would take a notable amount of investment and time for the other regions to align such resources to disrupt the Asian dominance.
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