Market Size of Japan Logic Integrated Circuit (IC) Industry
Study Period | 2019 - 2029 |
Base Year For Estimation | 2023 |
Forecast Data Period | 2024 - 2029 |
Historical Data Period | 2019 - 2022 |
CAGR | 6.07 % |
Market Concentration | Medium |
Major Players*Disclaimer: Major Players sorted in no particular order |
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Japan Logic Integrated Circuit (IC) Market Analysis
The Japan Logic Integrated Circuit (IC) Market was valued at USD 13.14 billion the previous year. It is expected to grow at a CAGR of 6.07%, reaching USD 24.16 billion over the forecast period. Logic semiconductors are used to process digital data to control the operation of electronic systems. Digital circuits are usually built from small microelectronic circuits called logic gates. Logic gates form the building blocks of digital systems.
With miniaturization trends, devices are becoming smaller, more power-efficient, and more portable. However, battery life, efficiency, and cost present significant issues in portable devices. In such devices, including tablets and laptops, logic is often used for battery charging and discharging blocks and to provide standby mode, power-down, and start-up control sequences.
Moreover, the proliferation of smartphones and tablets in the country, coupled with the growing demand for electric vehicles, are among the key drivers for the market. For instance, the monthly domestic shipment volume of smartphones in Japan reached around 930 thousand units in December 2022 (as per JEITA). In mobile devices, logic provides multiplexing, buffering, and level-translation functions for the baseband, RF interfaces, memory, and other peripherals.
Also, Japan's government is offering financial aid to encourage foreign chip makers to build plants in Japan, providing a strong impetus for market growth. For instance, in June 2022, Japan's Ministry of Economy, Trade and Industry (METI) announced plans to offer subsidies worth up to JPY 476 billion (USD 3.5 billion) for a semiconductor plant being built in Kumamoto Prefecture by Taiwan Semiconductor Manufacturing Co. (TSMC), Sony Group and Denso. Total investment in the plant was expected to reach around USD 8.6 billion, with Japan's government supporting about 40% of the costs.
However, modern IC technology has many design challenges. There is significant variability in the manufacturing process for advanced technology nodes. The actual operation of many devices on advanced ICs also results in variability, which manifests as changes in operating voltage, operating temperature, and performance.
COVID-19 impacted the entire semiconductor industry in several ways. Firstly, it disrupted the supply chain by complicating the shipping and transportation industry and reducing access to labor. Secondly, the pandemic further accelerated the demand for integrated circuits by starting a new wave of digital transformation and remote work.