Englewood, Colo. - The industrial semiconductor market is forecast to grow from $43.5 billion in 2014 to $59.5 billion in 2019, at a compound annual growth rate of eight percent, according to IHS Inc. (NYSE: IHS). Analysts expect market growth to be driven by increased capital spending and continued economic growth, particularly in the United States, led by commercial aircraft, LED lighting, digital video surveillance, climate control, traction and medical devices.
The United States accounted for 30 percent of all semiconductors used in industrial applications in 2015, according to IHS, followed by China, which consumed about 16 percent of all industrial semiconductors last year.
“Robust economic growth and increased capital spending in the United States is good news for industrial semiconductor suppliers, because they have the world’s largest industrial equipment makers, including General Electric, United Technologies and Boeing,” said Robbie Galoso, associate director, industrial semiconductors, IHS Technology, in a statement. “Strong industrial equipment demand will further boost sales of optical semiconductors, analog chips and discretes, which are the three largest industrial semiconductor product segments.”
The IHS report, Industrial Semiconductors Intelligence Service, finds that the biggest growth will come from LEDs, which is forecast to reach $14.5 billion in 2019, thanks to the global boom for LED lighting. Other big growth segments include discrete power transistors, thyristors, rectifiers and power diodes, reaching $7.8 billion in revenue in 2019, driven by growing energy efficiency policies in factory automation.
The analog application-specific integrated circuit (IC) segment also is projected to enjoy strong growth through 2019, reaching $4.7 billion in industrial markets, particularly in factory automation, power and energy, and lighting. Growth will be driven by power management product portfolios and device integration from Texas Instruments (TI), Analog Devices (ADI), NXP and other leading semiconductor firms, IHS said. Also driven by power efficiency and integration features, microcontrollers (MCUs) is forecast to reach $6.3 billion in 2019, up from $4.4 billion in 2014.
Total industrial original equipment manufacturing (OEM) factory revenue is forecast to reach $670 billion 2019, growing at a CAGR of five percent. Industrial OEM factory revenues grew six percent in 2015 driven by increased sales in building and home-control, and military and civil aerospace sectors, IHS said. The biggest growth drivers include LED lighting, climate control, digital video surveillance products and commercial aircraft.