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Semiconductors – the next wave

New report from Deloitte sets out opportunities and winning strategies for semiconductor companies into the next decade and beyond.

Published: 29 April 2019

Semiconductors – The Next Wave, a new report from Deloitte's experts in Mainland China, Taiwan, Japan and Korea, sets out opportunities and winning strategies for semiconductor companies into the next decade and beyond. According to the report, the global semiconductor industry is set to thrive with the rise of autonomous driving, AI (artificial intelligence), 5G networks and Internet of Things.

As well as exploring how these technologies, which were once the realm of science fiction, become mainstream, the report surveys the global M&A landscape, explores how international players can best enter China—one of the world's fastest growing markets—and explains how digitalization will be key to winning out on the global stage.

"The East Asia region has become a semiconductor hotspot. China commands almost half of overall market value and aspires to be both self-sufficient and a global sector leader. Japan and South Korea are seeking a resurgence through a range of measures concerning government expenditure, multilateral collaboration, acquisitions, etc.," says Deloitte China Technology, Media and Telecommunications Industry Leader William Chou.

The report notes that automotive semiconductor use in safety-related electronics is set to surge, reaching a value of USD600 per car by 2022. For AI semiconductors, cloud data centers are set to provide the biggest boost to growth, with advanced chips enhancing efficiency and reducing costs.

Addressing international players' aspirations to enter China, the report explores the gamut of factors they must consider before deciding on an entry strategy, including policies, technologies, marketing, logistics and how China fits into their global strategies.

Deloitte China Semiconductor Sector Leader Leo Chen says, "Many semiconductor companies generate half of their global revenue from China, but new entrants need to think carefully about their positions before coming up with an entry strategy."

"More broadly, semiconductor companies are going to have to be more agile than ever before if they are to thrive, and those who invest in digital infrastructure are going to have a profound advantage."


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