Foundry Market to Reach USD 171.70 Billion by 2032, Growing At An 3.99% CAGR - Credence Research

PUNE, India, Oct. 9, 2025 /PRNewswire/ -- The global foundry market was valued at USD 125.56 billion in 2023 and is projected to reach USD 171.70 billion by 2032, expanding at a CAGR of 3.99% during 2024-2032. Growth is driven by rising demand for metal cast components across automotive, aerospace, and industrial machinery sectors. Increasing adoption of lightweight alloys and precision casting techniques further supports market expansion.

Rapid industrialization in emerging economies, along with infrastructure development, strengthens foundry production activities. Automation and digital foundry solutions, including AI-based quality control and 3D sand printing, are improving process efficiency and reducing waste. However, high energy consumption and environmental regulations remain key challenges for global foundry operators.

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Key Growth Determinants

The growth of the foundry market is driven by rising demand from key industries such as consumer electronics, automotive, and industrial manufacturing. The increasing adoption of IoT devices, electric vehicles, and 5G infrastructure continues to boost demand for advanced semiconductor components. Fabless semiconductor companies are expanding rapidly, outsourcing chip production to specialized foundries to optimize costs and speed to market.

Technological advancements are another key determinant. Continuous migration toward smaller process nodes such as 5 nm and 3 nm enhances chip performance, power efficiency, and integration density. Developments in EUV lithography, 3D packaging, and automation further strengthen production efficiency and yield rates. Integration of AI-driven process control and data analytics within manufacturing is also improving operational reliability.

Government incentives and large-scale investments in semiconductor manufacturing infrastructure significantly influence market expansion. Programs such as the U.S. CHIPS Act and similar initiatives in Asia and Europe are fueling regional capacity building. However, the market faces challenges from high capital costs, talent shortages, and supply chain vulnerabilities. Geopolitical tensions, export controls, and sustainability pressures also shape the strategic direction of global foundry operations.

Key Growth Barriers

The foundry market faces several growth barriers that limit expansion and profitability. One of the most significant is the extremely high capital and operational cost involved in building and maintaining fabrication facilities. Setting up an advanced semiconductor foundry requires billions of dollars in investment for equipment, clean rooms, and power infrastructure. High operating costs related to energy consumption, process maintenance, and material sourcing further strain financial performance, especially for new or mid-sized entrants.

Technological complexity also acts as a major restraint. Rapid transitions to advanced process nodes such as 3 nm and below demand continuous research and development spending. Achieving high yield rates in such nodes is challenging, with only a few companies possessing the expertise and scale to sustain this progress. Limited access to advanced tools, including extreme ultraviolet (EUV) lithography, increases dependence on a small group of equipment suppliers, creating supply risk and potential production delays.

Another barrier is the shortage of skilled professionals. Semiconductor manufacturing requires specialized engineers in process design, lithography, and materials science, but talent supply has not kept pace with growing industry demand. Geopolitical tensions and supply chain disruptions also add uncertainty. Export controls, trade restrictions, and concentration of key suppliers in a few regions expose foundries to logistical and sourcing risks. Furthermore, the market's concentration among a few dominant players creates intense competition, narrow margins, and limited room for new entrants to grow.

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Key Market Trends

The foundry market is witnessing strong growth trends driven by rapid adoption of artificial intelligence, high-performance computing, and advanced communication technologies. Demand for AI accelerators, GPUs, and 5G chipsets is pushing foundries to expand production capacity and transition toward smaller process nodes such as 3 nm and 2 nm. This technological shift is supported by growing investment in heterogeneous integration and chiplet-based architectures that enhance computing efficiency and flexibility for AI-driven applications.

Advanced packaging technologies have also emerged as a major trend. Foundries are increasingly adopting 3D stacking and wafer-level integration methods such as CoWoS and InFO to achieve higher density and power efficiency. At the same time, the market is undergoing geographic diversification, with countries such as the United States, China, and members of the European Union offering large-scale subsidies to localize semiconductor manufacturing and reduce dependency on overseas fabs.

Another key trend is the increasing concentration of market power among leading players. TSMC continues to dominate global foundry capacity, followed by Samsung and GlobalFoundries, while smaller foundries focus on mature nodes and automotive-grade semiconductors to remain competitive. Sustainability has become a strategic priority as energy and resource costs rise. Companies are integrating AI and automation to optimize yield, reduce carbon emissions, and enhance overall production efficiency, making environmental compliance an integral part of long-term foundry strategy.

Key Opportunities

As global demand for AI, edge computing, and data centers explodes, foundries can capture massive new demand for high-performance chips. Many chip designers (fabless firms) continue outsourcing fabrication, creating opportunities for foundries to expand market share. Advances in heterogeneous integration, chiplets, and 3D stacking open new value niches beyond pure logic scaling.

Governments around the world are creating incentives to rebuild or localize semiconductor capacity (e.g. subsidies, tax credits). This supports new investments in under-served regions. Foundries that locate where policy support and infrastructure converge (e.g. U.S., Europe, India) may gain competitive advantages.

Other opportunities lie in specialization: targeting mature nodes for automotive, IoT, power electronics, and industrial markets where cost, reliability, and long product lifecycles matter. Also, services around chip design support, packaging, testing, and post-manufacturing solutions can add value and customer stickiness.

Segmentation

By Casting Processes:

• Sand Casting
• Investment Casting
• Die Casting
• Permanent Mold Casting

By End-user:

• Automotive
• Aerospace
• Construction & Infrastructure
• Energy

By Foundry Size and Scale:

• Large Foundries
• Small & Medium Sized Foundries

Based on Region:

• North America
• United States
• Canada
• Europe
• United Kingdom
• Germany
• France
• Asia-Pacific
• China
• India
• Japan
• Latin America
• Brazil
• Mexico
• Middle East & Africa
• South Africa
• United Arab Emirates

Regional Analysis

Asia-Pacific dominates the global foundry market, accounting for over 70% of total revenue in 2024. Taiwan, South Korea, and China are the primary contributors due to strong manufacturing bases, extensive supply chains, and government-backed investments. Taiwan's TSMC leads global production with advanced process nodes, while Samsung Foundry in South Korea continues expanding logic and memory integration capabilities. China is accelerating domestic semiconductor manufacturing through state funding and technology partnerships to achieve self-sufficiency and reduce import dependence.

North America represents the second-largest regional market, driven by significant investments under the U.S. CHIPS and Science Act. The region is attracting new fabs from companies like Intel, TSMC, and GlobalFoundries, aimed at strengthening domestic chip supply and supporting defense, automotive, and AI industries. Canada's market remains smaller but is gradually expanding in custom IC design and packaging segments.

Europe, the Middle East, and Africa are focusing on localization to reduce reliance on Asia. The European Chips Act supports large-scale projects in Germany, France, and Italy, with an emphasis on automotive-grade semiconductors and industrial IoT applications. Meanwhile, the Middle East is exploring semiconductor fabrication partnerships to support digital transformation and smart city projects. Latin America remains in its early growth phase, with emerging opportunities in backend processes such as assembly, testing, and packaging to serve regional electronics markets.

Credence Research's Competitive Landscape Analysis

Credence Research identifies the foundry market as moderately consolidated, with a few major players commanding significant market shares. Companies such as JSW Steel Ltd., Kirloskar Ferrous Industries Ltd., Larsen & Toubro Ltd., and Electrosteel Castings Ltd. lead the industry due to their production capacity, technological strength, and diverse product portfolios. These firms invest heavily in automation, advanced alloy development, and digital foundry systems to enhance efficiency, reduce waste, and strengthen environmental compliance.

Competitive differentiation is mainly driven by process capability, cost structure, quality control, and customer responsiveness. Large-scale foundries dominate high-volume production, while smaller and mid-sized foundries compete through niche specialization, faster delivery cycles, and regional proximity to clients. The market remains cost-sensitive, which encourages continuous improvement in energy efficiency and process optimization.

Innovation remains central to competitive positioning. Credence Research highlights the growing adoption of digital foundry technologies such as real-time monitoring, 3D sand printing, and predictive maintenance. These technologies help enhance product accuracy, reduce downtime, and optimize material usage. Foundries that successfully integrate digitalization and sustainability practices are expected to gain a long-term competitive edge in the evolving industrial landscape.

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Key Player Analysis

• Aditya Birla Management Corp. Pvt. Ltd.
• Ashok Iron Works P Ltd.
• Brakes India Pvt. Ltd.
• CALMET
• Cooper Corp. Pvt. Ltd.
• DCM Ltd.
• Electrosteel Castings Ltd.
• Fortune Foundries Pvt. Ltd.
• Gujarat Metal Cast Industries Pvt. Ltd.
• Hackforth Holding GmbH and Co. KG
• Jayaswal Neco Industries Ltd.
• JSW STEEL Ltd.
• Kalyani Group
• Kirloskar Ferrous Industries Ltd.
• Larsen and Toubro Ltd.
• Menon and Menon Ltd.
• Nelcast Ltd.

 Recent Industry Developments

• In March 2025, a new creative agency named Foundry was launched by industry veterans Gabi Revell and Jarryd Haefele. With over 22 years of combined experience in the creative and media industries, the duo aims to redefine branding and design through an innovative and modern approach.
• In February 2025, SkyWater Technology signed an agreement with Infineon Technologies AG to acquire Infineon's 200 mm fabrication facility in Austin, Texas (Fab 25). Under the deal, SkyWater will operate the site as a foundry, expanding U.S. production capacity for foundational chips ranging from 130 nm to 65 nm—vital for industrial, automotive, and defense sectors.
• In October 2024, SK keyfoundry, a leading 8-inch pure-play foundry in South Korea, announced the expansion of its high-voltage integrated circuit (HVIC) process portfolio. The new process integrates 5V logic, 25V high-voltage devices, 650V+ nLDMOS, and Bootstrap diode into a single chip, reducing external components and improving current performance for customer applications.
• In November 2024, HCL Technologies Ltd. introduced its Enterprise AI Foundry on Microsoft Azure. The platform enables businesses to combine data and AI assets using Microsoft's Azure Data and AI services to accelerate generative AI adoption. It is designed to optimize operations, support strategic decisions, and deliver faster business outcomes.

Reasons to Purchase this Report:

• Gain a comprehensive understanding of the market through qualitative and quantitative analyses, considering both economic and non-economic factors, with segmentation and sub-segmentation details provided in terms of market value (USD Billion).
• Identify regions and segments expected to experience the fastest growth or dominate the market, with a detailed analysis of geographic consumption patterns and the factors driving or hindering market performance in each region.
• Stay informed about the competitive environment, with rankings of major players, recent product and service launches, partnerships, business expansions, and acquisitions from the past five years.
• Access detailed profiles of major market players, including company overviews, insights, product benchmarking, and SWOT analysis, to understand competitive advantages and market positioning.
• Explore the present and forecasted market landscape, with insights into growth opportunities, market drivers, challenges, and constraints for both developed and emerging regions.
• Benefit from Porter's Five Forces analysis and Value Chain insights to evaluate various market perspectives and competitive dynamics.
• Understand the evolving market scenario, including potential growth opportunities and trends expected in the coming years.

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