Microelectronics is one of the most important technologies of our time. From electromobility, autonomous driving, self-learning machines to medical technology, as well as energy generation – nothing works without the tiny chips. These are also at the center of productronica 2021, which together with the parallel SEMICON Europe from 16th to 19th November takes place on the premises of Messe München and is the largest microelectronics fair in Europe.
Microelectronics is one of the most important technologies for innovation and progress in almost all areas of life. And while many industries are suffering from the corona pandemic, it continues its growth path undeterred. The current trend analysis Microelectronics 2021 of the ZVEI (B1. According to ZVEI), the global microelectronics market increased by 6.8 percent in 2020 compared to the previous year to $440 billion. And this despite a simultaneous collapse of 3.2 percent in the global economy. The trend is caused, among other things, by the strong demand for electronic equipment for the home office (e.g. PCs) and consumer electronics (game consoles, TVs). But electromobility, autonomous driving, edge computing and 5G are also among the growth drivers.
Currently, the demand for microelectronics is greater than supply for various reasons: The pandemic has given manufacturers of IT technology and consumer electronics a special economy, while surprisingly fast recovering car sales are slowed down by chip shortages. In addition, there were corona-related production losses, especially among Asian chip manufacturers, storms in Texas (Samsung, NXP and Infineon), fires in Japan (Renesas) and earthquakes in Korea (Shin Etsu, the world’s largest manufacturer of silicon wafers).
Global investments in the chip industry
Among other things, the suppliers for electronics production benefit from the high demand for chips, because semiconductor manufacturers invest billions of euros in new machines and systems. For example, TSCM wants to invest 100 billion US dollars in the next three years, as Handelsblatt on the 1st. April 2021 reported, Samsung reported around 175 billion dollars in the same period. Intel boss Gelsinger announced in the Frankfurter Allgemeine Zeitung (FAZ) on the 8th September 2021 to build chip factories for 80 billion euros in Europe – possibly also Germany. Prerequisite for this: Around 30 percent of investments are to be covered by public aid.
Finally, China’s semiconductor industry also benefits from generous state aid. According to the Semiconductor Industry Association (SIA), the government there subsidizes its own chip production with around 17 billion US dollars annually.
Among other things, China will easily maintain its lion’s share on the world market. According to the ZVEI press release of the 29th June 2021 declined for the first time last year, but at 34.4 percent well ahead of America with 21.7 percent (an increase of 13.6 percent) and Europe with 8.5 percent (a decrease of 1.2 percent).
Current subsidies in the USA and Europe
Massive subsidies in the USA and Europe are to shift global market shares: Biden’s trillion dollar investment program, for example, provides for $100 billion for the infrastructure of so-called “critical goods” – including microelectronics.
In Germany, the BMBF supports research and innovation in microelectronics over the next three years with 400 million euros in the framework program of the Federal Government “Microelectronics. Trustworthy and sustainable. For Germany and Europe”. According to the ZVEI, the Important Projects of Common European Interest (IPCEI -II) funding program is also suitable for sustainably strengthening microelectronics production in Europe.
Hope is given to the “Chip Act”, recently announced by the EU Commission, a targeted legislative package to strengthen the European chip industry.
On the other hand, the “Electronics Components and Systems for European Leadership” (ECSCEL) initiative launched in 2014 expires in 2025. The initiative is to be renewed with content enhancements in the current EU research framework program Horizon Europe under the name “Key Digital Technologies” (KDT). Negotiations at European level are about to be concluded; official start should be by January 2022 at the latest.
Record investments in chip equipment
The suppliers for chip production therefore have every reason to look positively into the future – even if disturbed supply chains and high raw material prices do not pass them by without a trace. For example, the “World Fab Forecast Report” from the industry association SEMI (Hallen B1.175, B1.571, B2.161) expects the record sum of 90 billion US dollars to flow into front-end process equipment (manufacturing processes on the wafer) worldwide this year, which is expected to rise to almost 100 billion in 2022. Foundry suppliers account for the largest share of the cake at $44 billion, followed by the memory area (memory) with over 38 billion and the microprocessors with nine billion US dollars.
The market for assembly and packaging equipment (backend processes) is expected to grow by 56 percent this year to six billion US dollars, followed by another six percent next year. For the semiconductor testing equipment sector, the industry association SEMI expects an increase of 26 percent to 7.6 billion US dollars in 2021, an increase of six percent for 2022.
The largest microelectronics fair in Europe
Thanks to the close integration of SEMICON Europa with productronica from the 16th to 19th, trade fair visitors can benefit from the exciting transformations within the microelectronics universe – technologically and market-politically. November at the Munich Exhibition Center. Industry representatives also benefit from a supporting program with a top-class conference. productronica 2021 is therefore the ideal place to exchange ideas with decision-makers, thought leaders and insiders about the latest trends and technologies.