Europe Semiconductor Device Market Size

Europe Semiconductor Device Market Analysis

Europe's Semiconductor Device Market is valued at USD 50.63 billion in the current year and is expected to reach a CAGR of 6.24% during the forecast period to become USD 68.52 billion by the next five years.

• The semiconductor industry is estimated to continue its robust growth during the forecast period to accommodate the increasing demand for semiconductor materials in emerging technologies, such as artificial intelligence (AI), autonomous driving, the Internet of Things, and 5G, coupled with competition among key players and consistent spending on R&D.
• For instance, Germany and Norway have set a target to make their transportation fully electric by 2040, banning the sale of new diesel and petrol cars. In line with this objective, the EV market in the country is expanding steadily, with the number of electric vehicles in the UK rising by 71% in 2021, as per the Society of Motor Manufacturers and Traders (SMMT). As the UK prepares to make the transition to pure-electric vehicle production over the coming years, with some manufacturers and brands committing to going 100% electric as early as 2025, demand for critical power electronic devices and systems is set to increase. This will further propel the market growth.
• Furthermore, as the impact of digitalization on lives and businesses has increased, semiconductor device markets have boomed. Notably, this has further resulted in government programs to support the 5G deployment. For instance, The European Commission recognized the importance of the 5G network at an early stage and established a public-private partnership to develop and research 5G technology. Moreover, in October 2022, according to the GSMA report, 311 million 5G connections will be there across Europe, with a 44% adoption rate by 2025.
• The semiconductor industry is considered one of the most complex industries. This is because more than several processing steps and various products are involved in their manufacturing and the harsh environment it faces, e.g., the volatile electronic market and the unpredictable demand.
• The outbreak of COVID-19 significantly disrupted the supply chain and production of the studied market in the initial phase of 2020. For circuit and chipmakers, the impact was more severe. Due to labor shortages, many of the package and testing plants in the Asia-Pacific region reduced or even suspended operations. This also created a bottleneck for end-product companies that depend on semiconductors. However, despite the decline in production caused by COVID-19, Europe's major industry, like the automobile industry, remains export-driven. As a result, these factors are boosting the automotive semiconductor device market's growth in Europe.