According to the Graphical Research new growth forecast report titled “North America Advanced Packaging Market Value, By Packaging Type (Flip-chip, Fan-in Wafer-Level Packaging (WLP), Embedded-die, Fan-out, 2.5 Dimensional/3 Dimensional), By Application (Consumer Electronics, Automotive, Industrial, Healthcare, Aerospace& Defense)”, Estimated To Be Around USD 5 Billion By 2026.
The North America advanced packaging market is gaining traction owing to the increasing adoption of emerging technologies, such as 5G, AI, and photonics, in the region. The proliferation of these technologies has emphasized the adoption of advanced packaging in manufacturing 5G and AI chipsets. Advanced chipsets designed using this technology offer compact size, high-end performance, and reduced power consumption in 5G & AI terminal devices. According to the GSMA intelligence Mobile Economy report, the total number of 5G connections in North America is projected to surpass the 205 million mark by 2025. This will further increase the demand for advanced packaging in foundries and IDMs to deliver 5G chipsets.
The 2.5D/3D segment in market is projected to grow at a CAGR of around 15% over the forecast period. This packaging technology offers several features, such as high chip connectivity, smaller footprint, and low-power consumption, compared to other packaging technologies. Such benefits increase its adoption in IDMs and foundries. The majority of the chipset and IC manufacturers are integrating new chip packaging options, such as 2.5D/3D ICs, to deliver circuits with small size, low-cost, and high-performance. For instance, in August 2019, GlobalFoundries announced to incorporate 3D advanced packaging technology for volume production of High-Performance Computing (HPC) chipsets, AI, and mobile SoC chipsets.
The consumer electronics application segment held a market share of over 70% in 2019 driven by the rising trend of compact electronic devices, such as wearable electronics, smartphones, and tablets, among others, increasing the demand for advanced packaging. Advanced packaging helps to improve device performance, energy efficiency, and reduce the packaging size to offer a smaller footprint. Adding to this, the growing consumer electronics industry in the U.S. has accelerated the growth opportunities for the North America advanced packaging market. For instance, according to the Consumer Technology Association January 2020 press release, the U.S. consumer technology sales accounted for USD 401 billion with a year-on-year growth of 2.2% in 2019.
The U.S. accounted for over 90% market share in 2019 and will grow at a CAGR of 7% from 2020 to 2026 in the North America advanced packaging market. Favorable initiatives by the U.S. government to support semiconductor manufacturing in the region will propel market growth. For instance, in June 2020, the U.S. lawmakers introduced a new bill ‘Creating Helpful Incentives to Produce Semiconductors (CHIPS)’ for America Act. The new bill will support U.S. semiconductor manufacturing, research & development, and supply chain equilibrium. Through this bill, the government will offer favorable incentives and tax benefits to foreign semiconductor manufacturing players, adding new growth opportunities for the advanced packaging market.
Key players in the North America advanced packaging market are extensively focusing on product innovation and strategic collaboration to stay competitive in the market. For instance, in August 2019, Deca Technologies announced that its proprietary ‘M-series’ Fan-Out Wafer-Level Packaging (FOWLP) technology is integrated into Qualcomm’s Power Management Integrated Circuits (PMICs). These advanced packaging ICs have applications in flagship smartphones of Samsung, LG, and Xiaomi. Some of the key players in the market are Amkor Technology, Inc., Deca Technologies, Sanmina Corporation, JCET Group Co., Ltd., Powertech Technology, Inc., ASE Group, and Siliconware Precision Industries Co., Ltd., among others.