Conformal Coatings Market Size, Share & Industry Analysis, By Product (Epoxy, Acrylic, Urethane, Parylene, Silicone, Others), By End-use Industry (Automotive, Medical, Aerospace & Defense, Consumer Electronics, Others), and Regional Forecast, 2024-2032

The global conformal coatings market size was valued at USD 992.1 million in 2023 and is projected to grow from USD 1,047.1 million in 2024 to USD 1,647.9 million by 2032, exhibiting a CAGR of 5.8% during the forecast period. Asia Pacific dominated the conformal coatings market with a market share of 85.77% in 2023. The conformal coatings market in the U.S. is projected to grow significantly, reaching an estimated value of USD 51.17 million by 2032, driven by the increasing demand from electric vehicle industry.

Conformal coatings are polymer-based materials that are applied as a thin layer on a Printed Circuit Board (PCB). A few of the polymers include acrylic, epoxy, silicone, and urethane, among others. In general, these coatings adhere to the irregular surface of the PCB and form an insulating layer between different electronic components. The high dielectric strength enables devices with compact PCB designs and thus supports the rising trend for miniaturization of electronic circuitry. Other than enabling the design of high voltage compact electronic circuits, conformal coatings also protect the exposed metal parts in a PCB from external factors such as humidity, temperature fluctuations, dust, and other airborne contaminants. Protection against these external agents is critical in limiting the corrosion of electronic components and can significantly enhance the service life of electronic devices.

The COVID-19 pandemic disrupted the market, causing disruptions in the supply chain and manufacturing processes. Uncertainties and reduced production activities across industries severely affected the product demand. However, as industries gradually recover from the effects of the outbreak, there is a potential for market rebound with increased emphasis on electric component protection.

Conformal Coatings Market Trends

Market Soars as Aerospace and Medical Industries Prioritize Electronic Component Protection

The aerospace industry’s growing reliance on advanced electronic systems has opened up a significant market opportunity for conformal coatings. These coatings protect critical aerospace components from severe temperatures, moisture, and corrosive substances. Conformal type of coatings improve the overall reliability and durability of electronic equipment used in aircraft and space exploration machines by providing optimal performance and endurance in difficult situations.

Similarly, the medical industry’s use of modern electronic gadgets and diagnostic equipment has driven up the need for conformal type of coatings. These coatings are critical in protecting sensitive electronics in medical equipment from contaminants, such as human fluids and environmental exposure. As the medical industry continues to innovate and extend its usage of electronic components, the demand for dependable electronic protection solutions grows. This consistent product demand allows manufactures to achieve high performance and reliability requirements in the aerospace and medical industries respectively.

Increasing Demand from Electric Automotive Segments to Drive Market Growth

The global automotive industry has been reinventing itself by moving toward electrification of automobiles over the past few years. The amount of electronic systems used in these new types of electric vehicles is several folds higher than ever before. Essentially, every other function in the automobile is controlled by a bunch of microcontrollers and processors. A few major electronic systems that are becoming new standards in the automotive industry include chassis electronics, driver assistance, engine electronics, entertainment systems, integrated cockpit systems, passenger comfort, passive safety, transmission electronics, and other things.

PCB is at the core of all these electronic systems and devices, which provides a base structure to assemble all electronic components. Conformal coatings can enhance the service life of automotive electronics and improve the overall reliability of the vehicles, which is of paramount importance in the automotive industry. The product plays a critical role in developing robust automotive electronic systems to sustain harsh external conditions witnessed during the complete service life of the vehicle. The use of PCBs in automotive is anticipated to rise significantly during the forecast period owing to its wider adoption in autonomous and electric vehicles. Thus, rising demand from the electric automotive sector is anticipated to drive market growth.

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GROWTH FACTORS

Rising Demand from Consumer Electronics Industry to Drive Market Growth

Conformal coatings usage was historically limited to circuit board coating protection in the aviation industry. Due to advancements in material and processing technologies, these coatings are now being widely adopted in the consumer electronics industry, including consumer electronic products such as white goods and mobile electronic devices such as mobile phones, tablets, and wearable electronics. Smart household electronics are getting smarter by implementing new technologies such as artificial intelligence and machine learning. These electronic devices are not just capable of connecting with each other but can effectively communicate internally, enabling a unique and highly personalized user experience.

Large tech companies are investing significantly in developing new smart home technologies. They are also collaborating to create a conducive ecosystem for growth. For example, since 2019, big tech companies, which include Apple, Google, and Amazon, have formed an alliance to develop a standardized operating ecosystem for smart home devices that work across multiple platforms. The growing affordability of electronic devices and the development of supporting technology, such as 5G and IoT, are likely to ramp up the product demand to manufacture consumer electronics. The product is crucial in extending the life span of these electronic devices. Thus, rising demand for consumer electronics is anticipated to benefit and drive the market growth.

RESTRAINING FACTORS

Adoption of Stricter Environmental Regulations to Hinder Market Growth

The Volatile Organic Compounds (VOCs) released from conformal coatings are categorized as Greenhouse Gases (GHG) and are a threat to the environment. The coating facilities that are not equipped with infrastructure to capture the solvent vapors released during the manufacturing process vent it out into the atmosphere. Once these VOCs come in contact with nitrogen oxides emitted by incomplete combustion of fuels in vehicles and other industrial activities, they react to form tropospheric ozone. This factor also results in the formation of fine particulate matter, creating a situation known as ground-level smog. The ozone layer formed at ground level has the potential to wreak havoc by forming harmful chemicals that can hinder plant growth.

Additionally, these synthetic carbon-based coatings tend to chemically degrade and release toxins when exposed to heat, sunlight, corrosive chemicals, and a host of other environmental conditions. In response to rising concerns for the environment and public health, governments across the world are adopting stricter standards to limit the emission of toxic VOCs. For example, in March 2020, China adopted four mandatory national VOC standards in coatings, adhesives, inks, and cleaning agents. These new standards are likely to affect companies using these products in the electronics and electrical industry. Thus, the adoption of stricter health and environmental regulations is expected to hinder the market growth.

Conformal Coatings Market Segmentation Analysis

By Product Analysis

Acrylic Segment to Account for a Significant Share Owing to Rising Adoption in Electronic Manufacturing Sector

Based on product, the market is segmented into acrylic, epoxy, urethane, silicone, parylene, and others.

In 2023, the acrylic segment dominated the market. The acrylic segment is driven by a surge in demand from the electronics manufacturing sector. These types of coatings are widely used in various end-use industries, including automotive, consumer electronics, and other industries. Acrylic coating is easy to apply, and the processing is relatively simpler. However, it has poor resistance to petroleum-based solvents and alcohols. This factor makes it relatively easy to repair. Acrylic has a moisture resistance that is similar to polyurethane and silicone. They have excellent mechanical and electrical properties. These types of coatings have good thermal stability with an operating temperature range of approximately -59°C to 132°C. They have an excellent dielectric strength of approximately 1,500 volts/mil. Its relative affordability makes it a cost-effective option for various end-use industries.

By End-use Industry Analysis

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Consumer Electronics Segment to Hold a Substantial Share Owing to Rising Demand in Miniaturized Electronic Applications

In terms of end-use industry, the market is segmented into automotive, aerospace & defense, medical, consumer electronics, and others.

The consumer electronics segment accounted for a major share of the market. Electronic devices have witnessed a trend of miniaturization of electronic components over the past few years. Smaller PCBs along with miniaturized electronic devices arranged in a compact design can lead to circuit damage if the dielectric strength between components is low. Conformal coatings, when applied to these miniaturized PCBs can significantly increase the dielectric strength between electronic components, thus enabling the design of much more compact electronic circuits. Demand for compact, lightweight electronic devices is anticipated to increase significantly during the forecast period owing to advancements in IoT and 5G technology. These factors are driving the overall industry growth.

REGIONAL INSIGHTS

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Asia Pacific accounted for a major market share in 2023 and was valued at USD 850.9 million. The region is likely to maintain its position during the forecast period owing to rising demand from its electronics-manufacturing sector. The majority of global consumption is concentrated in Asia, with China leading as a dominant consumer. The country has a robust electronics-manufacturing sector, thereby accounting for around 40% of the total global consumption in 2021. Additionally, most of the countries in the region are in their early phase of economic development with an enormous untapped market growth potential.  The living standards and purchasing power of people in these developing countries have improved significantly over the past few years. As this trend continues, it is anticipated to surge the demand for consumer electronics.

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The demand for electric vehicles in North America has risen over the past few years. According to the International Energy Association, electric car sales in the U.S. surpassed the mark of half a million in 2021, doubling the share to reach 4.5% of total car sales. The amount of electronics found in a new conventional car has increased several folds over the past decade. The use of electronics in an electric or hybrid vehicle is much higher than in conventional internal combustion-based vehicles. The reliability of the electronics used in automobiles influences consumer decision. Thus, automakers are employing innovative ways to protect the fragile electronic components and the pathways on a PCB without increasing the vehicle's weight. The product protects the sensitive electronic system from the harsh environment with minimal increase in weight relative to space-consuming solutions such as enclosures. Thus, growing demand from the automotive industry is anticipated to drive the market.

The European automotive sector is among the prominent contributors to its economic prosperity. The region's automotive sector employs around 13.8 million people, accounting for more than 6.0% of total EU employment. The region is home to several well-established global automakers with regionally based manufacturing facilities. According to the European Automobile Manufacturers' Association, as of April 2022, there are around 301 automobile assembly and engine production plants across Europe. The automobile industry is already pivoting to capitalize on the electrification wave. As the average electronic components per vehicle increases, the consumption of conformal coatings used in the automotive sector is anticipated to increase simultaneously. 

The Latin America region is expected to develop as a manufacturing hub during the forecast period. The region's close proximity to countries, such as the U.S. and Canada, provides a logistical advantage to the local industries. As a result, various countries in the region have witnessed a rise in foreign investment during the last decade. As the manufacturing sector in the region expands, the demand for industrial electronics to support and sustain the growth is also anticipated to rise. The coatings ensure the durability and long service life of industrial electronic equipment and systems. The expanding industrial sector in the region is anticipated to drive market growth.

The market in Middle East & Africa is expected to witness substantial growth during the forecast period. Countries such as South Africa have a robust agro-processing industry, which includes food & beverages, textiles, clothing, leather & footwear, and wood & wood products. The food & beverages division is a prominent contributor to the country's manufacturing industry. As most of these industries are moving toward automation, the demand for electronic systems that include PCBs, sensors, and other electronic components is expected to rise during the forecast period. This factor will prompt an increase in demand that is critical in protecting these sensitive electronic components from various external agents, thus extending the service life.  

List of Key Companies in Conformal Coatings Market

Companies Deploy Strategic Planning to Strengthen their Market Share

A few major market players primarily dominate the market. The existing players have developed proprietary products, and they maintain a competitive edge over other players owing to their unique product offerings. Furthermore, the companies are continuously conducting R&D activities to develop better solutions to match the changing needs of the electronic industry.

The major manufacturers operating in this market are DOW, H.B. Fuller, Henkel AG & Company, and Shin-Etsu Chemical Co., among other players. Plant expansions and strategic mergers & acquisitions characterize the global market. The market's major businesses have been actively acquiring competitors to acquire better economies of scale. Simply put, scale makes it simpler for established companies to sustain their dominance, resulting in intense competition. Several other companies, such as Electrolube, Chase Corporation, Chemtronics, Dymax Corporation, Specialty Coating Systems, and M.G. Chemicals, are among other active participants in the market.

LIST OF KEY COMPANIES PROFILED:

• Chemtronics (South Korea)


• Henkel AG & Company (Germany)


• Shin-Etsu Chemical Co., Ltd (Japan)


• Dow (U.S.)


• Chase Corporation (U.S.)


• Dymax Corporation (U.S.)


• Specialty Coating Systems (U.S.)


• Electrolube (U.K.)


• H.B. Fuller (U.S.)


• M.G. Chemicals (Canada)

KEY INDUSTRY DEVELOPMENTS:

• March 2022 – HumiSeal introduced conformal coating UV500-2, providing PCB protection. It is designed to provide additional performance under thermal and mechanical cycling testing common in the automotive and white goods industries.


• April 2022 – Shin-Etsu Silicones of America, Inc. (SESA), a U.S. subsidiary of Japan-based Shin-Etsu Chemical Co. Ltd., launched MR-COAT-01F and 02F conformal coating series. These products feature high hardness and extremely high elongation for better abrasion resistance and less stress on PCB components.


• October 2021 – In order to increase electronics reliability in the harshest of environments, Electrolube, a part of MacDermid Alpha Electronics Solutions, launched a new generation of conformal coatings and thermal gap fillers at Productronica.


• October 2021 – Electrolube launched a new UV Cure Coating Xtra (UVCLX), a bio-based conformal coating. This new bio coating is primarily made using organic content that is obtained from a renewable source. The new product is made using solvent-free technology. The company claims that its new product is unique to the industry and provides a high level of protection while maintaining a quick processing time.


• October 2020 – Henkel Adhesive Technologies decided to invest in Actnano to expand its functional coatings product portfolio. Actnano is a U.S.-based startup that produces advanced materials, including nanotechnology-based coatings that can be customized as per customer requirements to protect printed circuit boards in a variety of applications.

REPORT COVERAGE

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The global conformal coatings market research report provides a detailed market analysis and focuses on crucial aspects such as leading companies, products, and products. Also, it offers insights into key market trends and highlights vital industry developments. In addition to the abovementioned factors, the report encompasses various factors contributing to the market's growth in recent years. It further includes historical data & forecasts revenue growth at global, regional, and country levels, and analyzes the industry's latest market dynamics and opportunities.

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