Power Electronics Market Size, Share & Industry Analysis, By Device Type (Power Discrete, Power Module, and Power IC), By Material (Silicon, GaN, SiC, and Others), By End-User (Consumer Electronics, Automotive, Industrial, Biomedical and Healthcare, Aerospace and Defense, and Others), and Regional Forecast, 2024 - 2032

The global power electronics market size was valued at USD 24.53 billion in 2023. The market is projected to grow from USD 25.78 billion in 2024 to USD 43.42 billion by 2032, exhibiting a CAGR of 6.7% during the forecast period.

The technology of power electronics involves the efficient conversion, control, and supervision of electric power to regulate the flow of electrical energy. Its applications range from laptop chargers to inverters that power electric vehicles and renewable energy systems. Its function is to control the electricity flow, optimize efficiency, and reduce waste.

The market’s growth is expected to be driven by the increasing demand for wearable or electronic devices & Electric Vehicles (EVs), rising need for automation technologies, and emergence of Industry 4.0. Moreover, the focus on energy efficiency and demand for renewables is fostering a strong potential for the market share to grow. Therefore, growing concerns about the environment have pressurized governments around the world to regulate vehicle emissions. In December 2021, U.S. President Joe Biden issued an executive order to drive the country’s clean energy economy by implementing federal sustainability measures. The goal is to achieve 100% carbon-free electricity by 2035 to enhance the sustainability of power plants.

The power electronics industry suffered from the COVID-19 pandemic due to severe lockdowns, reduced product sales, and suspension of vehicle production, contributing to the market’s decline. Manufacturers in the industry experienced losses as a result of disruptions in the supply chain and a decrease in sales. Changes in consumer behavior, including increased reliance on digital services and remote work, influenced demand patterns for electronic devices and infrastructure. Market leaders started investing funds and expanding their production capabilities to leverage the potential of advanced power electronics.

IMPACT OF GENERATIVE AI

Advanced Design Capabilities of Generative AI for Power Electronics to Fuel Market Growth

The market can be transformed by generative AI as it has the potential to improve design capabilities, enhance performance, increase reliability, and stimulate innovation in energy efficiency and sustainability. AI algorithms can help engineers in generating and assessing multiple design possibilities according to specific criteria, such as efficiency, size, and cost to create more effective and inventive solutions. Furthermore, these algorithms can examine power electronics system data to forecast potential failures or maintenance requirements, ultimately reducing downtime, enhancing reliability, and prolonging equipment lifespan. This can lead to overall cost reduction.

The market is anticipated to experience strong growth as the technology develops, leading to advancements in different applications and sectors.

Power Electronics Market Trends

Rapid Adoption of Energy Efficient and Sustainable Products to Emerge as Key Trend

The development of power electronics is experiencing a significant shift toward sustainability as manufacturers are concentrating on lowering energy usage and prolonging the lifespan of these electronics. This strategic focus is in line with a broader dedication to reducing the environmental impact of the production and usage of power electronics. Through the integration of energy-efficient technologies and design practices, existing manufacturers are actively contributing to the overall drive for sustainability in the technology sector.

Power electronics are essential for transforming electrical energy flows into renewable energy sources with maximum efficiency through the conversion and regulation of both AC and DC power. Renewable energy installations, particularly those utilizing wind and solar energy, rely heavily on power electronics-based converters due to the potential of these energy sources for generating electricity. These renewable systems encompass a wide range of components, such as solar panels, wind turbines, fuel cells, batteries, capacitors, and other power devices. This approach addresses environmental issues and responds to customer demands for environmentally responsible solutions.

Power Electronics Market Growth Factors

Widespread Adoption of Electric Vehicles to Reduce Energy Consumption Will Aid Market Growth

Electric vehicles rely heavily on power electronics for battery management, motor control, and charging infrastructure. The shift toward electric mobility is driving the demand for advanced electronics solutions that are compact, efficient, and reliable. It contributes significantly to achieving energy efficiency goals by minimizing energy losses during power conversion and optimizing the efficiency of electric drivetrains.

This power electronics market growth can be substantial with the increasing popularity of EVs. The rising global demand for electric vehicles creates a greater need for advanced, efficient, and dependable power electronics solutions to support the electrification of transportation effectively. In addition, manufacturers have new opportunities for growth due to quick advancements in battery technology and increasing efforts to promote the advantages of renewable energy systems.

RESTRAINING FACTORS

High Cost and Technological Complexity of Power Electronics to Hinder Market Expansion

The adoption of power electronic components has been hindered by high cost, particularly for advanced technologies. Production costs of electronics with superior features, high precision, and specific requirements have increased due to the complexity of manufacturing processes or the use of expensive materials. Moreover, these systems have become more advanced to meet efficiency and performance demands. However, these advancements have also made them more complex. This complexity can increase development costs, time-to-market, and the need for highly skilled engineers and technicians. The adoption of the components in price-sensitive markets has been hampered by the high costs and technological complexities involved.

Power Electronics Market Segmentation Analysis

By Device Type Analysis

Major Role in Consumer Electronics Boosted Adoption of Power Discrete Devices

Based on device type, the market is segmented into power discrete, power module, and power IC.

In terms of share, the power discrete segment dominated the market in 2023. Consumer electronics manufacturers can create new equipment models with features, such as low noise and high power efficiency by using power discrete devices to optimize energy consumption.

The power module segment is anticipated to register the highest CAGR during the forecast period. The growth of this segment is fueled by the increasing demand for managing the transition of currents and voltages, thereby facilitating effective power conversion and control. Additionally, the growing usage of power modules in electric vehicles and other electric motor controllers, and in AC to DC inverters, power supplies, appliances, electroplating machinery, battery chargers, converters, welding equipment, and medical equipment is contributing to this segment’s growth.

By Material Analysis

Low-Power Application of Silicon-based Devices Fueled Their Demand

Based on material, the market is segmented into silicon, GaN, SiC, and others.

In terms of share, the silicon segment dominated the market in 2023. The aim of silicon-based devices in low-power applications is to reduce cost, easy access to parts, and a large community of experienced engineers in silicon-based designs implementation. Silicon devices can be tailored to efficiently carry out tasks, such as rectification, amplification, and switching, making them suitable for a diverse array of uses.

The SiC segment is anticipated to register the highest CAGR during the forecast period. SiC devices are seeing a rising adoption in industries, such as renewable energy, automotive, and telecommunications due to the continuous growth in demand for high-performance power electronics solutions. The automotive industry is increasingly demanding SiC devices for electrical energy management as vehicles become more electrified.

By End-User Analysis

Consumer Electronics Dominated Market Due to Changes in Consumer Preferences and Continuous Technological Developments

Based on end-user, the market is categorized into consumer electronics, automotive, industrial, biomedical & healthcare, aerospace & defense, and others.

In terms of share, in 2023, the consumer electronics segment dominated the market due to the rising demand for enhanced user experience, device functionality, and new forms of interaction. Additionally, the incorporation of advanced technologies, such as AI and IoT is anticipated to open up opportunities for the development of newer consumer electronic appliances, thus shaping the market growth.

The industrial segment is expected to record the highest CAGR during the forecast period. Uninterrupted Power Supply (UPS) devices, server power supplies, power converters, and motor drives are responsible for consuming much of the world's electricity. Hence, improving the efficiency of industrial power supplies will substantially reduce a company's operational expenses. The demand for high-efficiency power electronic components is growing rapidly due to increased power density and improved thermal performance.

REGIONAL INSIGHTS

Based on geography, the market is fragmented into North America, South America, Europe, the Middle East & Africa, and Asia Pacific.

Asia Pacific held a major power electronics market share in 2023. Power electronics is becoming more prevalent in electric vehicles, increasing the need for significant energy to drive electric motors. Components, such as MOSFETs and IGBT serve as power electronic switches in power train systems. The notable expansion of the market in the region is due to increasing demand for fuel-efficient hybrid electric vehicles in China, India, Japan, and other countries to mitigate the escalating environmental pollution.

• In April 2023, the PowerUP Asia conference and exhibition showcased the latest advancements and patterns in power electronics, such as WBG devices, power semiconductors, and associated technologies. It mentioned that the expansion of the Electric Vehicle (EV) sector, increasing advocacy for the adoption of renewable energy, evolving trends in industrial automation, and growing demand for consumer electronics are driving the expansion of the power electronics industry. Manufacturers are concentrating on power efficiency, carbon emission reduction, and the use of 'greener' energy to meet these demands.

Europe is estimated to grow at the highest rate during the forecast period. The growing use of power electronics to enhance vehicle performance and meet strict emission and safety regulations is a key factor influencing the growth of the regional market. Europe's focus on renewable sources, which is being driven by the increasing adoption of industrial automation, has also been a growth driver for this market. In December 2021, ABB held a ceremony to mark the beginning of the construction of its global competence center for power electronics in Switzerland. Totaling approximately USD 42 million, the new smart building represented a significant investment in the location. ABB aims to enhance its dominant position in the market through this initiative.

North America is expected to register the second-highest growth rate in the global market during the forecast period. The growth is driven by the increased demand for high-speed data transmission, emergence of 5G technologies, and widespread use of IoT.

The Middle East & Africa is expected to register a significant growth rate in the global market during the forecast period. The region’s growth is attributed to rapid urbanization, rising renewable energy integration, and increasing number of electrification projects.

South America is poised for significant growth during the forecast period. This growth is attributed to strong proliferation of smartphones, digital transformation, and rise in e-commerce platforms.

KEY INDUSTRY PLAYERS

Market Players Use Merger & Acquisition, Partnership, and Product Development Strategies to Expand Their Business Reach

Major players operating in the market are providing advanced power electronics by improving their energy efficiency and reliability with minimal power loss. These companies are prioritizing the acquisition of small and local firms to expand their business reach. Moreover, mergers & acquisitions, leading investments, and strategic partnerships will contribute to an increase in the demand for the market players’ products.

List of Top Power Electronics Companies:  

• Texas Instruments Incorporated (U.S.)


• Infineon Technologies AG (Germany)


• Mitsubishi Electric Corporation (Japan)


• Vishay Intertechnology, Inc. (U.S.)


• Toshiba Corporation (Japan)


• STMicroelectronics N.V. (Switzerland)


• ABB Ltd. (Switzerland)


• NXP Semiconductors N.V. (Netherlands)


• ON Semiconductor Corporation (U.S.)


• Renesas Electronics Corporation (Japan)

KEY INDUSTRY DEVELOPMENTS:

• June 2024: Renesas Electronics Corporation finalized the acquisition of Transphorm, Inc., a leading global company specializing in gallium nitride (GaN). Following the completion of the acquisition, Renesas promptly introduced GaN-based power products and associated reference designs to address the increasing need for Wide Bandgap (WBG) semiconductor products.


• June 2024: Texas Instruments (TI) and Delta Electronics teamed up for a long-term partnership to develop advanced Electric Vehicle (EV) charging and power solutions. This collaboration utilized the R&D expertise of both companies in power management and delivery at a joint innovation lab in Taiwan. The goal of Delta and TI is to enhance the size, performance, and power density and expedite the development of faster-charging, safer, and cost-effective EVs.


• March 2024: Infineon acquired GaN Systems, a Canadian company specializing in Gallium Nitride, for USD 830 million. This acquisition expanded Infineon's technological expertise and strengthened its strategic position in the fast-growing power semiconductor market.


• May 2023: Texas Instruments introduced a new isolated gate driver, the UCC5880-Q1, which is highly integrated, functional, and complies with safety standards. This gate driver allows engineers to create more efficient traction inverters and optimize the driving range of electric vehicles. Its features assist EV powertrain engineers in boosting the power density, simplifying system design, lowering costs, and meeting safety and performance targets.


• June 2021: Renault Group and STMicroelectronics declared a strategic partnership to collaborate on designing, developing, manufacturing, and supplying STMicroelectronics’ products and associated packaging solutions for the power electronics systems of battery-operated and hybrid vehicles. These systems have a substantial impact on the driving range and charging of electric vehicles as they reduce power losses and enhance efficiency. This leads to decreased battery costs, increased kilometers per charge, quicker charging times, and reduced user expenses.

REPORT COVERAGE

The report provides a detailed analysis of the market and focuses on key aspects, such as leading companies, types, materials, and end-user. Besides, it offers insights into the market trends and highlights key industry developments. In addition to the factors mentioned above, the report encompasses several factors that have contributed to the growth of the market in recent years.

REPORT SCOPE & SEGMENTATION