Status of the MEMS industry 2009 report: Yole

LYON, FRANCE: Yole Développement has released its MEMS report: Status of the MEMS Industry 2009 Report. For the 6th year, “Status of the MEMS Industry” is the only publication analyzing the MEMS industry, from key technical aspects to business strategies of the TOP30 MEMS companies.

This market and technological analysis provides a 360° analysis of the evolution of MEMS applications and markets. Yole Développement presents the updated data on MEMS markets and the evolution of the equipment markets for MEMS production. The company also analyzes the industry from the manufacturing and innovation points of view and the strategies of the main players. A specific focus on MEMS packaging trends has been also developed in this report.Source: Yole Développement

A restart of the net growth is expected after 2010
The MEMS markets are flat since 2007: from $7.1 billion in 2007, to $6.8 billion in 2008 to an estimated $6.9 billion in 2009. But that result is the sum of a huge plus in consumer electronics applications, which grew 25 percent CAGR and a huge minus with established automotive business taking a big hit.

A restart of the net growth is expected after 2010, with a CAGR of 12 percent in the next four years. The production equipment market is extremely low at $140 million (in 2008, 2009 and 2010) and will restart in 2011:

• The production infrastructure in place is sufficient to absorb the growth for the next two years and we will have to wait until 2011 for a significant restart of the MEMS production equipment market.

• The MEMS foundry growth in 2008 and 2009 was limited at 6 percent (after years of 30 percent growth annually) and will restart in 2010 with more than 25 percent CAGR expected in the next four years.

Flat business made 2008 and 2009 really difficult
In the face of a collapsing mainstream semiconductor sector over the past 18 months, the MEMS business held its own and remained flat. While this is great news for MEMS overall, for the many MEMS companies that made production infrastructure investments in 2006 and 2007, flat business made 2008 and 2009 really difficult.

“The MEMS industry remains highly diverse and as such the impact of the financial collapse and economic recession has been varied”, explained Jean-Christophe Eloy, President and CEO at Yole Développement. “While established applications have struggled, new ways to package and integrate MEMS devices in systems buttressed the industry. New MEMS devices are indeed growing very fast -‐ two-axis gyros, MEMS IMU and MEMS oscillator, to name a few.”

Reviewing key players: Several companies stopped their MEMS production entirely or in part (Delphi, Continental, Colibrys, Systron Donner Automotive, etc.), while others saw their businesses enter a huge growth phase (InvenSense, Kionix, STMicroelectronics, SiTime, etc.). All in all, booming new business was entirely offset by flagging established business with the net result flat.

Innovation in MEMS is changing: few totally new devices are now launched and most new applications are linked to new usage of existing devices (human machine interface, replacement of existing technologies).

With packaging averaging more than 40 percent of the cost of a MEMS device strong efforts are being put into adapting the packaging to drive out cost and enter new applications (like mobile applications).

In parallel, MEMS foundries are coming out of the economic downturn in a strong position: more system manufacturers have made the decision to stop internal MEMS manufacturing and are now working with MEMS foundries. MEMS foundries are extremely active with these new customers. As can be expected, this growth is attracting new players like TSMC, UMC and others.

In addition, wafer level packaging and 3D chip stacking using through silicon vias (TSV) are also a growth driver for the MEMS foundries. Driven by cost reduction goals
needed for consumer applications investments in 8’’ infrastructure continued despite the downturn.