Automated Test Equipment Industry Growth Avenues amidst Restrained Semiconductor Market.
The reasons that impacted significantly the semiconductor industry has been the steep decline in the average selling prices of semiconductor components while the product and development costs up surged. The second dominant reason lies in the efforts from China’s government to set up an entire self-sufficient semiconductor industry.
China, backed by robust government policies under ‘Made in China 2025 Policy’ is planning to invest $160 billion in its Semiconductor Industry scattered over the course of few years. This year, it already has planned to pump $24 billion in creating state-of-the-art semiconductor industry aimed at memory chips market. XMC, a contract chip maker owned by Chinese government in association with Spansion Inc. are going to co-develop next-generation chip technologies. China is already a global leader in terms of semiconductor consumption with nearly 56% share in 2014. This has already created a strain on the trade deficit of the country which in order to reduce, led to policies for establishing a robust semiconductor industry. The country is aiming at self-sufficiency of 40% by 2020 and gradually to 70% by 2025.
Considering that Memory Chips will prove to be evolutionary due to the requirements for next-generation data storage enhanced by rise in Cloud and Internet of Things (IoT) platforms, the ATE industry will find a sweet spot in this market. Memory products such as DRAM and NAND along with others occupy nearly 18%-20% of the ATE market in semiconductor industry. Considering the favorable conditions being created in the China Semiconductor Industry, the ATE market can surely ride this wave. The key differentiating factors obviously will be in offering the comprehensive solutions for ATE along with increase in complexity of devices, reduced time to market and supplementing the intensified production yields.
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