High-Value MEMS Market Growth Slows

Revenue in 2012 for high-value MEMS, a market characterized by the lofty average selling prices compared to other MEMS devices, amounted to $1.63 billion, equivalent to growth of 6.5 percent from $1.53 billion in 2011. While revenue was up, growth was noticeably down from the 12.5 percent expansion of 2011. This year will see a slightly improved 7.4 percent increase to $1.8 billion as the industry starts to recover during the second half. Growth then picks up by 2014 and rises to 10.3 percent, with 2015 and 2016 also forecast to experience solid upturns north of 9.0 percent. “The high-value MEMS market last year suffered a deceleration in growth because of continuing slow sales in medical electronics as well as a broad-based downturn in the industrial segment,” said Richard Dixon, Ph.D., principal analyst for MEMS & Sensors at IHS. “In medical electronics, the market performance has been sluggish for the last 18 months, echoing global economic uncertainties. The same macroeconomic headwinds also curtailed end-user demand in industrial electronics semiconductors, inflicting further pain. The high-value MEMS market was aided slightly by strong performance in the telecom, aerospace, and oil and gas sectors, which served to ameliorate the negative effects of the slow-moving sectors.” Higher growth expected for high-value MEMS Despite the diminished growth of 2012, the high-value MEMS market remains the second-fastest-expanding area in the broader MEMS space, coming in after the mobile and consumer market but leading the data processing and automotive segments. High-value MEMS accounted for 19 percent of the total MEMS industry last year, despite extreme fragmentation of the space with well over 100 suppliers. The average selling prices of sensors used in high-value MEMS are also much higher than the prices of sensors used in other MEMS segments, which gives the high-value MEMS industry its strength and importance. Results sluggish in most high-value MEMS segments Six sectors make up approximately 95 percent of the high-value MEMS market. The largest is medical electronics, accounting for more than 80 percent of total high-value MEMS shipments last year. The majority of medical electronics sensors are used for diagnostics, patient monitoring and therapy. For instance, tens of millions of pressure sensors are used and thrown away annually, with the sensors deployed to monitor the blood pressure of patients during and after major operations. Pressure and flow sensors are also used in devices like ventilators and respirators; implantable devices such as cardiac monitors; thermometers; and infusion pumps for introducing fluids, medication or nutrients into a patient’s circulatory system. The depressed performance in medical electronics was also present in other high-value MEMS segments. The test and measurement space, especially in semiconductor testing and wafer processing, was flat to down last year. Likewise, the industrial segment governing power tools and transportation exhibited anemic results. Weak growth expected Two high-value MEMS segments registered growth but were weak at best: building and home control on the one hand, with smart meters declining last year; and manufacturing and process automation on the other, because of low growth in areas like industrial motors. In the energy generation and distribution segment, results were mixed. Spending on utilities was down and wind turbine deployments were slowing, but oil and gas showed strong demand in the third quarter based on shale discoveries. The one segment of the high-value MEMS industry that was up strongly last year was military and civil aerospace. Despite a decelerating missiles and munitions market, the segment more than made up with the extremely robust commercial aircraft sales of the Airbus from Pan-European maker EADS, as well as of the Dreamliner planes made by U.S maker Boeing. Six devices made up 83 percent of the high-value MEMS market last year. The biggest was microbolometers—tiny arrays of heat-detecting sensors sensitive to infrared radiation—used in firefighting, law enforcement and surveillance systems. Other prominent high-value MEMS devices include pressure sensors, optical MEMS in telecommunications, wafer probes for semiconductor testing, inkjet printer heads, and accelerometers for gadgets like pacemakers.