The global market for discrete semiconductors will grow 3-4 percent per year through 2016 although there will be price erosion, according to chipmakers.
Ron Clifford, senior director regional marketing Americas for Vishay Semiconductors, noted that power transistors are the largest part of the discretes market and that World Semiconductor Trade Statistics (WSTS) forecasts that power transistor sales growth will be slightly stronger than the overall discretes market.
However, he felt growth may not be as strong for power transistors as WSTS forecasts because of above average price erosion, especially for metal oxide semiconductor field emitting transistors (MOSFETs), which are the largest product segment within power transistors.
"Average selling price (ASP) erosion has been higher in MOSFET's than almost any other discrete semiconductor and I would expect that trend to continue because there are simply too many suppliers vying for market share," said Clifford. Price erosion for discretes "is running about -3 percent per year," he said.
The overall discrete semiconductor market growth will be driven by mobile phones, media tablets and other mobile devices, said Clifford. He said there is also healthy, steady demand for discretes from automotive, industrial and medical markets in the Americas and in Europe. Wearable electronics such as fitness trackers, smart watches and smart glasses, could also be an important segment for discretes in the future.
Clifford also noted one key trend with discrete semiconductors is the need to increase power density to lower costs to combat ASP erosion and ultimately improve manufacturing margins. "The next most important trend to watch is in non-silicon wafer technologies such as gallium nitride (GaN) and silicon carbide (SiC)."
Jay Heinecke, vice president of discrete marketing at Toshiba America Electronic Components, Inc. said for his company, "super junction high-voltage MOSFET's have great potential for growth because of strong demand for higher efficiency MOSFETs for the power supply market."
"Also, our new high-brightness, white LEDs for the lighting market will be in high demand," said Heinecke. He added that: automotive, server (including data centers and networking) lighting, tablet, and smart phones are driving demand for Toshiba's discrete products. Emerging markets for discretes include wireless charging systems, wearable devices, and micro inverter/optimizers.
TTI's discrete businesses posted robust double-digit growth and the growth trend looks like it will continue through 2014.
"Our discrete semiconductor business grew more than 20 percent in 2013," said Jeff Ray, vice president supplier marketing TTI, Inc. Americas. "Thus far in 2014, sales have continued to grow +20 percent over 2013, he said.
"Growth may even be stronger for the remainder of 2014 as more and more core TTI customers work with our branches for their MOSFET, diode and rectifier as well as LED, optocoupler and display requirements," said Ray.
Ray added, longer term, TTI's growth in discretes will be fueled by additional sales of existing products as well as from new products and/or new suppliers. He said TTI will look for further growth in the company's discretes business by reaching new customer segments, but the distributor's primary strategy is, "to continue to penetrate our existing account base. A customer base that primarily consists of industrial, mil/aero with transportation – starting to emerge as a core segment for TTI," said Ray.
Statements of fact and or opinions expressed in MarketEYE by its contributors are the responsibility of the authors alone and do not imply an opinion of the officers or the representatives of TTI, Inc.
Jim Carbone is a freelance writer who has covered the electronics supply chain for 25 years.
Carbone was a writer and editor for Electronics Purchasing and Purchasing magazines for 21 years covering electronics distribution, semiconductors, passive components and connectors. He has written extensively about the strategic purchasing strategies of electronics OEMs and electronics manufacturing services providers.
Before covering the electronics industry, Carbone worked as a reporter and editor for United Press International (UPI) for nine years. He started his career as a newspaper reporter and photographer.
He is a graduate of the State University of New York at Albany. Currently he writes for several publications and websites, including Electronics Sourcing North America magazine, Electronics360.com and Globalpurchasing.com among others.