Electronics Production | August 23, 2011

Revenue growth rate in SMT jumps from 3.7% in 2009 to 6.9% in 2010

With denser and more complicated assemblies necessitating automated inspection processes, the SMT inspection market rebounded admirably from the slowdown, with a growth rate of 6.9% in 2010.
SMT manufacturers will have to increase investments in R&D to meet customer and industry requirements for constant innovation, if they are to survive in this market.

However, they will be hard pressed to balance rising R&D budgets with steadily decreasing average selling prices (ASPs). SMT equipment manufacturers can hope to offset their costs and obtain better margins by being the first to offer new, innovative, sophisticated and high-end equipment.

New analysis from Frost & Sullivan finds that the market earned revenues of USD 922.8 million in 2010. It is expected to grow at a compound annual growth rate of 8.9% to reach USD 1'680.3 million in 2017.

Product enhancements are critical in a market that is experiencing rising demand for increased resolution, more software interface, accurate algorithms and higher throughput. In the next seven years, the segments that are likely to gain the most are AO inspection equipment and X-ray inspection solutions.

"The AO inspection equipment system will get a leg up from machine vision-based algorithms that are relatively flexible, easy to program, and capable of better detection with less false call rates," says Frost & Sullivan Research Analyst Lavanya Rammohan. "Meanwhile, the X-ray inspection equipment’s success lies in its incorporation of intuitive programming and computer tomography, which has made it suitable for applications beyond non-destructive testing and for electronics manufacturing inspection."

As customer perception gradually evolves from defect detection and defect containment to progressive prevention, SMT manufacturers are bolstering their portfolio through product diversification. Ensuring high levels of quality will continue to remain the key market driver and hence, manufacturers are looking to develop products that enable faster throughput by eliminating testing bottlenecks and facilitating high yield.

"Catching defects at the onset is essential for achieving cost savings," notes Rammohan. "Both OEMs and contract manufacturers are focusing on reducing quality failure to ensure brand reputation and successful launch of products in the target market."

The new-age inspection equipment should also have the ability to deal with the continuous shift toward component miniaturization. This miniaturization has made printing, placements and soldering processes more intricate, as the adoption of 01005 size components and decreasing board size has complicated the circuit. This has helped spur the demand for accurate SMT inspection equipment.

To cope with the demands of the end-user market, the SMT inspection equipment market is expected to witness a spate of strategic alliances and mergers and acquisitions (M&As).

Overall, augmenting yield, eliminating rework, developing processes, reducing costs and, more importantly, enhancing returns will remain the most significant selling points of SMT inspection equipment.

Market Opportunities for Growth in the Global Surface Mount Technology (SMT) Inspection Equipment Markets is part of the Surface Mount Technologies Growth Partnership Services program, which also includes research in the following markets: Global Surface Mount Technology Placement Equipment Markets, Indian Surface Mount Technologies Market, Global Surface Mount Technology Inspection Equipment Markets, and EMS Provider Regional Migration Opportunities. All research services included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants.


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