Market Trends of Electronics Adhesives Industry
This section covers the major market trends shaping the Electronics Adhesives Market according to our research experts:
Surface Mounting Application to Dominate the Market
- Surface mounting, also known as chip bonding, is the major application of adhesives in the electronics industry.
- Surface-mount technology extensively uses electronics adhesives in electronic assembly to mount electronic components to the surface of the printed circuit board (PCB).
- Electronic adhesives are used for both wave soldering and reflow soldering processes. These compounds have excellent electrical conductivity and are easy to distribute. The process includes placing surface-mount-devices on beads or dots of UV curing adhesives and curing the adhesive to firmly, securely hold the device at the requisite place during further processing of the electronic equipment being manufactured.
- Surface mounting adhesives act as a processing aid by holding the mount devices until permanent attachment by soldering and offer stress relief to soldering parts to prevent failure of electric connections.
- The types of adhesives used in this application are mostly one-component systems, made from acrylics, epoxies, or urethane acrylates. The function of these adhesives also varies depending on the application, they can either be electrically conductive or electrically non-conductive and/or thermally conductive.
- Furthermore, electronics adhesives act as alternatives to tin-soldering. With the increasing regulations, the companies are increasingly shifting away from tin-soldering to the usage of electrically conductive adhesives.
- The properties of adhesives required for surface mounting are long shelf life, non-stringing, high wet weight, rapid curing, high strength and good flexibility, and good electrical properties after curing. Moreover, single component systems are preferred for these applications to avoid air entrapment, viscosity changes, and pot life.
- The growing research in the development of high-performance adhesives for mounting miniaturized devices in the electronics industry is estimated to drive the market during the forecast period.
- The global consumer electronics market revenue was around USD 1.02 trillion in 2020 compared to USD 1.03 trillion in 2019, witnessing a decline of 0.8%. The declining sales revenue was due to the COVID impact and United States-China trade war, which impacted the raw material supply, thus affecting the consumer electronics market and in turn electronic adhesives market.
- The electronics revenue is forecasted to grow by 3.6% for the year 2021 and expected to reach around USD1.6 trillion. The market is expected to grow annually by a CAGR of 2.3%. The increase in demand for consumer electronics, in turn, will increase the demand for the electronics adhesives market.
- Owing to the growing adoption of surface mount technology across the world for printed circuit board manufacturing, the surface mounting application is likely to dominate the electronics adhesives market during the forecast period.
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Asia-Pacific Region to Dominate the Market
- Asia-pacific accounts for the highest share of the global electronics adhesives market with the majority of the demand coming from China.
- China is emerging as one of the biggest markets, both in terms of consumption and production of electronic adhesives, and accounts for slightly more than half of the total market in the Asia Pacific.
- Factors, like increasing urbanization, growing connectivity, combined with the usage of advanced technology in the manufacturing of safety technologies and infotainment systems, are boosting the demand for printed circuit boards.
- The Chinese consumer electronics is valued at around USD 248.7 billion USD 2020, with a fall in revenue by 0.2% compared to 2019. The Chinese consumer electronics is forecasted to grow by around 4% to reach USD 258.8 billion in 2021.
- Apart from China, other countries, such as South Korea, Japan, and Singapore are also expected to witness significant growth in demand for electronics adhesives during the forecast period.
- The Indian government initiative "Make in India" has been attracting foriegn direct investments to the electronics sector, this in turn has lead to a boost in the electronics manufacturing services industry in the country. The Atmanirbhar initiative also emphasises on making India into a global consumer electronics manufacturing hub. For instance, in February 2021, Amazon India announced to commence electronic devices manufacturing India, which is likley to boost the electronic adhesives demand in the country.
- The Indian electronics market is expected to reach USD 400 billion by 2025. Additionally, India is expected to become the fifth-largest consumer electronics and appliances industry in the world by 2025. Additionally, in India, technology transitions, such as the rollout of 4G/LTE networks and IoT (Internet of Things), are driving the adoption of electronic products.
- The automotive industry produced a total of 4,516,017 vehicles (including passenger and commercial vehicles) in 2019, as compared to 5,174,645 vehicles in 2018, registering a negative growth of about 12.2%. At the same time, sales of new vehicles declined by about 13.26% during 2019 as compared to 2018. The declining demand and inventory piling up with the automotive producer led to a further decline in domestic automotive production.
- According to OICA, the country produced a total of 3.39 million vehicles in 2020, which declined by 25% compared to 2019. The automotive industry is already facing a critical situation and is hard hit by the coronavirus's spread.
- Hence, owing to the above-mentioned factors, Asia-Pacific is likely to dominate the market studied during the forecast period.
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