Thermal Interface Materials Market Size, Share & Trends Analysis Report By Product (Tapes And films, Greases And Adhesives), By Application (Telecom, Computer), By Region, And Segment Forecasts, 2020 - 2027

Report Overview

The global thermal interface materials market size was valued at USD 1.8 billion in 2019 and is expected to grow at a compound annual growth rate (CAGR) of 11.0% from 2020 to 2027. Growing consumer reliance on electronic items like smartphones, tablets, the advent of the automotive industry in developing economies, and the growing affluence of the middle-class population is expected to project a higher demand for the product among manufacturers across regions.

Thermal interface materials are applied between two hard surfaces for conducting heat and find its usage at times of greater demand for modern electronic devices. Commercial availability of different thermal interface materials in an array of forms coupled with growing applications in the electronic industry is anticipated to increase the penetration over the coming years.

In the U.S., there is an evident high demand for thermal interface material in the telecom industry due to high penetration for data and smartphones in recent times. In lieu of providing high and fast speed networks, and releasing unique content calls for higher bandwidth, and thus optimal system performance. The same pattern is observed in the computer industry due to the rise in automation, innovation, and IT employment rates.

The post-pandemic condition has not dampened the consumer behavior pattern for electronic devices like smartphones, tablets, and video games. Rather consumer durables sales too have been pretentious in recent times amid the crisis. Moreover, the demand for the manufacturing of pharmaceutical and medical machinery, and lab equipment has witnessed growth owing to an increased call for drugs and medical equipment.

Thermal interfaces are commonly known to provide efficient heat management solutions required for improving the system's overall performance and lifespan. Various products of thermal interfaces available in the market include greases, thermal tapes, elastomeric pads, and solders. Thermal interface material selection criteria are based on mechanical factors, electrical insulation, quality, thermal resistance, performance, and material compatibility.

The product is anticipated to witness significant gains owing to its thermal conductivity nature which helps in strengthening the life and efficiency of the electronic device or the equipment where it finds its application. The product is usually made of conducting materials like silicone, metal oxides, or metals.

Product Insights

Thermal greases and adhesives dominated the market with share of over 34.5% in 2019 owing to its widespread usage in consumer products and high thermal resistance. The elastomeric pads are expected to have a significant share in market for thermal interface materials on account of its easy assembly as compared to greases. Also, with elastomeric pads, handling mechanism is improved and possesses less chances of degrading interface resistance.

Phase change materials are anticipated to have high CAGR as compared to other product segments at 11.5% in the thermal interface materials market. The segment finds its major usage in construction work as demand for cooler buildings is increasing. The thermal interface material acts as heat storage wherein the heat gets absorbed during summer and retained heat can be used in winter times to manage the temperature difference.

Elastomeric pads are expected to register significant growth in the projected period owing to easy handling and installation techniques used for thermal conductivity in electrical and electronic components. However, limited application scope and high unit costs of the products are expected to hamper the growth in the estimated time frame.

These interface materials are majorly used for applications in dispensable gels, gap filling and insulating pads, adhesive tapes, and greases. These are selected based on their toughness, environmental and chemical resistance, hardness, tensile strength, and thermal conductivity.

Application Insights

The computers application segment accounted for a significant share of over 24.0% in 2019 on account of increasing utilization in office end-use. The affordable prices of desktops have revolutionized the demand and supply of the product. The post-pandemic times did not dampen the market for thermal interface materials; rather with the increase in the number of people working from home, the upgradation, sales, and installation figures of PC market have risen.

The telecom application segment for the product utilization is expected to witness significant demand in the estimated time owing to the increasing preference for a digital and cashless economy. The banks, e-commerce, utilities, and media are reliant on the telecom industry for its business and are seen as its lifeline. Thus, is likely to support the industry growth in the projected time.

The products are considered to address the challenge of higher thermal insulation, dissipation, and conductance in medical electronics and other industries. These are broadly classified as one of polymer matrix composites, metal matrix composites, and carbon composites products. Moreover, technical advancements in the product for providing better thermal management solutions are expected to augment the growth.

The thermal interface material’s other applications are found in medical devices, industrial machinery, consumer durables, and automotive electronics. With the advanced cockpit functionality, the thermal interface materials are also installed in aerospace components. The recent advancements in military and aerospace applications have led the engineers to address the increased thermal management issues.

Regional Insights

Asia Pacific dominated the market with a share of over 37.5% in 2019 due to high demand for thermal interface materials in the region. This is owing to presence of large base of manufacturing zone in the region. In addition to the manufacturing base, reduction in corporate tax, GST, rising household incomes, consumer health awareness, changing lifestyle, and government policies has potential to propel industry growth in this region.

The product is set to gradually lose out on its revenue gained in Europe despite the region being major market for automotive industry and medical device manufacturing. This is attributed to the fact that because of the outbreak of recent pandemic, manufacturing activities has come to a standstill due to collapsing supply, and demand of vehicles.

The sales in the automotive sector could only be made through refurbishment or maintenance of vehicles as more trucks and vans are used for supplying essentials across the region. However, with government’s continuous focus on healthcare and automotive industry by encouraging FDI from Asian manufacturers can help revive the business in the forecasted period.

The current pandemic situation has acutely affected the medical devices segment in the U.S. since the region imports 39.3% of its medical device demands from China. There is a significant fall in the production which is expected to affect U.S. manufacturers and assemblers. However, the healthcare segment remains promising in the U.S. and is expected to drive thermal interface material’s demand over the forecasted period.

Key companies & Market Share Insights

The companies have considered diversifying and integrating their business processes in order to cater to value chain aspects of their enterprise. The companies are trying to remain competitive in the market for thermal interface materials by exploiting economies of scale, expanding through acquisition and mergers, and joint ventures. The acquisition and mergers are facilitating the companies to expand their product reach and improve product quality.

The industry has been witnessing increasing investments and continuous efforts in R&D to introduce thermal interface materials with enhanced characteristics, thereby increasing their chances of market penetration. The presence of internationally renowned players in the thermal interface material’s space is likely to experience disruptive competition because of presence of emerging players in Asia Pacific offering the thermal management solution at lower costs. Some of the prominent players in the thermal interface materials market include:

• The 3M Company

• Henkel

• Indium Corporation

• Fujipoly

• The Dow Chemical Company

• Honeywell International Inc.

• SIBELCO

• Shin-Etsu

Thermal Interface Materials Market Report Scope

Segments Covered in the Report

This report forecasts revenue growth at a global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2027. For the purpose of this study, Grand View Research has segmented the global thermal interface materials market report on the basis of product, application, and region:

• Product Outlook (Revenue, USD Million, 2016 - 2027)

  • Tapes and films

  • Elastomeric Pads

  • Greases and adhesives

  • Phase change materials

  • Metal Based

  • Others

• Application Outlook (Revenue, USD Million, 2016 - 2027)

  • Telecom

  • Computer

  • Medical devices

  • Industrial machinery

  • Consumer durables

  • Automotive electronics

  • Others

• Regional Outlook (Revenue, USD Million, 2016 - 2027)

  • North America

    • The U.S.

  • Europe

    • Germany

  • Asia Pacific

    • China

    • India

  • Central & South America

    • Brazil

  • Middle East & Africa