Latest News- Semiconductor Capital Spending Market in US: Automotive is expected to lead the End-user segment during 2025-2029

The Semiconductor Capital Spending Market in US is being driven by Growing investments in fabs

The Semiconductor Capital Spending Market in US is expected to grow at a CAGR of 5.4% during 2024 and 2029. During this period, the market is also expected to show a growth of USD 11366.5 million. The semiconductor industry in the United States has undergone notable transformations in wafer sizes over the past five decades. To minimize costs by approximately 20%-25%, the industry has transitioned to larger diameter wafers, with 300-mm wafers now being the industry standard for manufacturing Integrated Circuits (ICs). This trend is anticipated to persist throughout the forecast period, with companies allocating substantial capital expenditures towards the establishment and enhancement of such fabrication plants. For instance, in April 2024, Taiwan Semiconductor Manufacturing Company (TSMC) unveiled plans to construct a third fabrication facility in Phoenix, Arizona, as part of a larger USD65 billion investment - the largest foreign direct investment in Arizona's history. 

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Which Factors Are Causing a Surge in Market Growth?

The market is segmented based on

• End-user
  • Automotive
  • Consumer electronics
  • Telecommunication
  • Others
• Application
  • Wafer fab equipment
  • Automated test equipment
  • Wafer-level packaging and assembly equipment
  • Die-level packaging and assembly equipment
  • Others
• Geography
  • US

According to Technavio, There are several factors that are causing the market to flourish during the forecast period, which are as follows: 

• Growing investments in fabs
• Surge in demand for consumer electronics and smart electronic devices
• Miniaturization of electronic devices

However, the market also witnesses some limitations, which are as follows:

• High dependence on a limited number of key suppliers
• High-investment market
• Cyclic nature of semiconductor industry

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Market Scope in Semiconductor Capital Spending Market in US Research Report

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Research Analysis Overview

The Semiconductor Capital Spending Market in the US is influenced by various factors including chip demand, inflation, and monetary tightening. Supply and capacity are key concerns for semiconductor firms like Intel and Micron, leading to increased memory spending. Chipmakers invest in new tool and facility manufacturing, focusing on advanced nodes to improve yields and manufacturing processes. Inventory buildup and investment tax impact strategic industry decisions. Consumer electronics, generative AI, and factories drive device demand, necessitating timely execution and investment in logic chips and equipment.

Market Research Overview

The semiconductor capital spending market in the US is driven by various factors, primarily the expanding demand for chips from various industries, including consumer electronics, automotive, and industrial. However, monetary tightening and inventory buildup pose challenges to market growth. The semiconductor industry comprises chipmakers, both IDMs and fabless companies, producing integrated circuits (ICs) such as memory, logic, and discrete components, as well as optoelectronics, sensors, and discrete semiconductors. According to Technavio, the global semiconductor market size is determined by the revenue generated from the shipment of semiconductor ICs to OEMs and ODMs. The market's growth is fueled by escalating investments in constructing new fabs and expanding existing ones, leading to increased production capacity for semiconductor ICs. Despite these growth drivers, market expansion may be hindered by inventory buildup and monetary tightening, necessitating careful supply chain management and financial planning by chipmakers.. Industries are leveraging the products belonging to the market for customer engagement, transactional notifications, and promotional offers.

Technavio Research
Jesse Maida
Media & Marketing Executive
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UK: +44 203 893 3200
Email: media@technavio.com
Website: www.technavio.com/