Chip Resistor Market by Technology (Thick Film, Thin Film, and Others), End-use (Consumer Electronics, Industrial, Automotive & Transportation, Telecommunication, Aerospace & Defense, and Others), and Regional Analysis (North America, Europe, Asia-Pacific, and LAMEA): Global Opportunity Analysis and Industry Forecast, 2021–2028

Global Chip Resistor Market Analysis

The global chip resistor market is predicted to garner $3,330.3 million in the 2021–2028 timeframe, growing from $1,932.8 million in 2020, at a healthy CAGR of 6.9%.

Market Synopsis

Increase in demand for consumer electronics with recent innovations such as high definition equipment and eco-friendly electronic products are expected to accelerate the growth of the chip resistor market.

However, volatile price of raw materials of chip resistor tools is anticipated to be a growth-restricting factor for the market.

According to the regional analysis of the market, the Asia-Pacific chip resistor market is anticipated to grow at a CAGR of 7.1%, by generating a revenue of $1,434.1 million during the review period.

Chip Resistor Overview

Chip resistors are integrated circuit (IC) devices that are available in rectangular or square chip packages and are very compact and surface mounted electronic components designed to provide a known resistance to any electrical current flowing through it. They are utilized for operating, protecting, or controlling circuits. They may have a fixed value of resistance or a flexible or adjustable value of chip resistance within a specific range. Chip resistors are also known as surface-mount devices or SMD resistors widely used in automotive & transport, consumer electronics, industrial, and IT & telecommunication applications.

Impact Analysis of COVID-19 on the Global Chip Resistor Market

COVID-19 was declared as a pandemic in 2019 and the effect of the pandemic was felt on various industries along with the global chip resistor market. Owing to COVID-19 pandemic, the decline in the growth of key industries using chip resistors such as industrial electronic equipment and automobile has impeded the growth of market in the last couple of years. Manufacturing activities of chip resistors have been restricted due to lockdown measures implemented in many countries, as well as many production facilities have been completely or partially shut down. Furthermore, ban on export, along with shortage of raw materials have created interferences in the production of chip resistors. The demand from end-use industries such as consumer electronics, industrial, automotive & transportation, IT & telecommunication, and others have been reduced expressively due to hindrance in daily operations. Regular operations are anticipated to begin with full capacity post the lockdown is lifted, and the demand is expected to rise steadily thereafter.

Rising Demand for Electronic Devices to Surge the Market Growth

Growth of the global chip resistor industry is expected to be driven largely by the demand for electronics such as smartphones and the proliferation of applications such as the Internet of Things and cloud computing. Inclusion of emerging technologies such as AI in products and 5G networks as well as rapid growth in automotive and industrial electronics are expected to be some of the market's key driving forces. For instance, in May 2021, Vishay inter technology, a manufacturer of semiconductors and passive electronic components, introduced high precision thin film wraparound chip resistor that delivers tight TCR of ± 2 ppm/°Cover 100 Ω to 3.05 MΩ resistance range used in industrial, medical, military, and aerospace applications.

To know more about global chip resistor market drivers, get in touch with our analysts here.

Volatile Price of Raw Materials to Restrain the Market Growth

Price fluctuations of raw materials are expected to restrain the growth of the global market during the forecast period. Raw materials used in chip resistor, such as ruthenium and palladium continue to demonstrate volatility in prices and are expected to have a continuous impact on the costs to produce chip resistors.

Technological Advancement in the Market to Create Massive Investment Opportunities

The global chip resistor market is growing rapidly owing to developments in emerging technologies such as electric and autonomous vehicles, 5G, and Internet of Things (IoT). Internet of things will be a huge driving force in the ongoing technology evolution. It will bring great opportunities for component manufacturers and suppliers in upcoming year. As per the Global System for Mobile Communications Association (GSMA), there will be around 25.1 billion IoT devices by 2025 across the globe. Moreover, as per automotive industry estimates, around 5.1 million conventional vehicles sold in the U.S. will be replaced by 4.7 million autonomous electric vehicles by 2030. These developments are likely to present favorable opportunities for chip resistor market over the forecast period.

To know more about global chip resistor market opportunities, get in touch with our analysts here.

Source: Research Dive Analysis

The thick film chip resistor sub-segment is predicted to have a dominating market share in the global market and is expected to register a revenue of $1,563.0 million during the forecast period. This is due to the growing adoption electronics and electrical devices and surge in the demand for advanced miniature tools in various industries such as consumer electronics and automotive.

For instance, in April 2020, Bourns announced a New AEC-Q200 thick film resistor series designed for general purpose applications including consumer, industrial, telecom and other applications. The company designed this family of devices in five different versions to support specific application requirements: CRxxxxA-AS AEC-Q200 compliant, CR standard, CR-PF ultra-low lead content, CR-AS sulfur resistant, sulfur resistant, and CRxxxxA AEC-Q200 complian.

The thin film chip resistor type is anticipated to have the fastest market growth and generate a revenue of $1,283.9 million by 2028, growing from $727.4 million in 2020. Growth in data center infrastructure as well as use of lead-free components is expected to drive the global thin film chip resistors market growth. For instance, in March 2018, Panasonic Corporation, a leader in the development of diverse electronics technologies, established a 0402 size, high precision thin film chip resistor that helps rise accuracy and decrease electro-static discharges risk in automotive electronic control units (ECU) and industrial robots.

Source: Research Dive Analysis

The consumer electronic sub-segment of the global chip resistor market is projected to have the fastest growth and surpass $444.7 million by 2028, with an increase from $238.8 million in 2020. This growth in the market can be attributed to the rising demand for chip resistor solutions for consumer electronics due to rise in the number of consumer electronic devices such as smartphone, tablets, and computers.

The telecommunication sub-segment is anticipated to have a dominating market share in the global market and register a revenue of $955.7 million during the analysis timeframe. The rising number of smart devices and smart phones in today’s technologically advanced world as well as necessity of working from home may create huge opportunities for the sub-segment throughout the forecast period.

Source: Research Dive Analysis

The Market for Chip Resistor in Asia-Pacific to be the Most Dominant

The Asia-Pacific Chip Resistor market accounted $ 819.0 million in 2020 and is projected to register a revenue of $ 1,434.1 million by 2028. The rising adoption of high-end technology-based devices coupled with the cheap electronics prices is leading to an improvement in the electronic products, thereby allowing the region to dominate in terms of the chip resistor market share.

China grasps the largest share in the global chip resistor market and is projected to witness the highest CAGR in the upcoming years due to the surging presence of local producers such as, Yageo Corporation and Tzaiyuan Enterprise Co., Ltd These players tend towards offering a huge range of products at discounted rates in bulk quantity, helping in the growth of the chip resistor market in China over forecast period.

Competitive Scenario in the Global Chip Resistor Market

Product launches and mergers & acquisitions are common strategies followed by major market players.

Source: Research Dive Analysis

Some of the leading chip resistor market players are Bourns Inc., TE Connectivity, Vishay Intertechnology Inc., Koa Corporation, Tzai Yuan Enterprise Co., International Manufacturing Services, Yageo Corporation, Rohm Semiconductor, AVX Corporation, and Susumu Co. Ltd.

Porter’s Five Forces Analysis for the Global Chip Resistor Market:

• Bargaining Power of Suppliers: The suppliers in the chip resistor market are moderate in number. For the large semiconductor companies, suppliers have little power - many semiconductor companies have hundreds of suppliers. This diffusion of risk over many companies allows the chip giant to keep the bargaining power of any one supplier to minimum. Thus, there is less threat from the suppliers.   
  Thus, the bargaining power suppliers is moderate.
• Bargaining Power of Buyers: Buyers have high bargaining power, primarily because of the huge number of chip resistor services that are offered in low prices. The buyers can hence choose the service that best fits their preference. 
  Thus, the bargaining power of the buyers is high.
• Threat of New Entrants: Companies entering the chip resistor testing market are adopting technological innovations such as developing resistance range. Similarly, these companies are implementing several effective strategies such as offering discounts and value propositions. 
  Thus, the threat of the new entrants is high.
• Threat of Substitutes: There is no alternative product for chip resistor. 
  Thus, the threat of substitutes is low.
• Competitive Rivalry in the Market: The competitive rivalry among industry leaders is rather intense, especially between the global players including TE Connectivity and Vishay Intertechnology Inc. These companies are launching their value-added services in the international market and strengthening the footprint worldwide. 
  Therefore, competitive rivalry in the market is high.