Spotlight
IEKCQM Forecast: Taiwan’s Semiconductor Industry to Exceed NT$5 Trillion in 2024
ITRI’s IEK Consulting in June released the IEKCQM (IEK Current Quarterly Model) forecast for Taiwan’s manufacturing and semiconductor industry outlook in 2024. The overall manufacturing output is projected to reach NT$23.1 trillion, with an annual growth rate of up to 6.47%. The semiconductor industry, benefiting from the strong demand in the AI-driven supply chain, is expected to see promising development throughout the year. It is estimated to surpass the NT$5 trillion for the first time, reaching NT$5.1134 trillion, with an annual growth rate of 17.7%. This figure exceeds the global semiconductor growth rate of 13.1%.
AI Drives Demand for Advanced Processes
The optimistic outlook of Taiwan’s semiconductor industry is primarily due to cooling inflation, a stable job market, rising consumer power, and favorable inventory adjustments in the industry. The increasing demand for semiconductors driven by AI applications will further bolster this growth.
According to IEK Consulting, driven by the easing inflation and the rise of AI smartphones and AI PCs, Taiwan’s IC design industry is expected to grow by 15.1% in 2024. The IC manufacturing industry is projected to grow by 20.2% due to continuous improvements in advanced manufacturing processes and a rebound in DRAM prices. The IC packaging and testing industry will boom from the demand for device upgrades and high-end packaging. This drives a surge in capital investment and developments in heterogeneous chip integration and advanced packaging technologies, with an estimated growth rate of 11.4% for 2024.
ITRI’s IEK Consulting forecasts that AI PCs and AI smartphones will become key applications due to the popularization of Gen AI in 2024.
Transition from Cloud to Edge Computing
With the rising popularity of ChatGPT, major PC brands are launching AI-powered PCs equipped with neural processing units (NPUs). Such PCs will perform computations locally rather than through the cloud, resulting in more efficient and low-latency processing. Functions such as voice recognition and image processing will in turn be enhanced. Consequently, the share of AI PCs in overall PC shipments is estimated to grow rapidly from 20% in 2024 to 80% by 2028.
Smartphones, with their powerful on-device computing capabilities, extensive user base and engagement, and comprehensive applications, are poised to further drive the development of Gen AI. The share of AI smartphones in overall smartphone shipments is projected to increase rapidly from 20% in 2024 to 70% by 2028.
The demand for high-performance end devices is also pushing semiconductor packaging technology towards high-density interconnect development. Besides 2.5D/3D IC packaging technologies, fan-out packaging is extending to panel-level carriers due to its cost and performance advantages. By enhancing heterogeneous chip integration and advanced packaging technologies, the industry aims to meet the high-performance application demands of AI at the end device level.