A FABulous addition

Man working with O-ring molding in a clean room
Date: 14.03.25
Semiconductors make possible all the intelligent systems we take for granted today. Asia is the key hub for chip production, and Trelleborg’s newly established footprint in the region means that the Group can support its customers as the industry globalizes.

Sales of semiconductor chips reached more than 500 billion USD in 2024. This is just half of the widely accepted industry prediction for 2030 of one trillion USD. Although the ubiquitous use of electronics drives this market, the major expansion is due to the acceleration in demand for the complex chips that facilitate the training and inference of generative artificial intelligence (AI) models.

 

“Generative AI is not just ChatGPT, a chatbot that uses natural language processing to create humanlike conversation,” says Chris Busby, Global Semiconductor Segment Director at Trelleborg. “It is now used pretty much everywhere in the background, from manufacturing to law, banking to space travel, supercomputers to autonomous driving.”

 

Some see AI as a threat, but Busby believes that it can make a significant contribution to the world. “Consider data analysis in health care,” he says. “AI is going to completely revolutionize drug discovery as it can create drug molecule models in seconds rather than years.”

 

Through organic growth, strategic acquisitions and investment in innovative material development and manufacturing, Trelleborg has built a strong share in niche semiconductor applications.

 

“Our capabilities from a customer services point of view are global,” Busby says. “However, we needed a stronger manufacturing and R&D presence in Asia, and there were products that seemed to have obvious synergies with our existing portfolio that we needed to add to fully serve our customers.”

 

Filling this gap resulted in the acquisition of the Korean MNE Group, consisting of the companies Materials Nano Engineering and Materials Nano Solution, which was finalized in April 2024.

 

Says Busby, “South Korea is a really important market for semiconductors; two of the three largest chip makers in the world are Korean.”

 

Asia dominates the semiconductor market with around three-quarters of FAB capacity where semiconductors are made, and virtually all chip assembly and testing is in the region.

 

“Semiconductor development and production began in Silicon Valley in the US,” Busby explains. “It then migrated out of the US toward Asia to lower costs. Japan was the first Asian country to dominate semiconductors.

 

“Now Taiwan is the leader in logic chips, making about 90 percent of the most advanced chips – those that are in your iPhone, for instance,” he says. “South Korea is the biggest producer of memory chips. The country intends to establish the K-semiconductor mega cluster as the world’s largest semiconductor hub by 2047.

 

“The other major player in Asia is China, which has a huge and growing capacity,” Busby says. “The country aims to increase this by about 40 percent by the end of 2030. However, most of the increase is aimed at domestic consumption.”

 

For Taiwan, exporting chips and developing a semiconductor infrastructure outside the country are critical. To do this it is building chip factories in the US, Japan and Europe, with Germany as a focus.

 

“Chip manufacturing is developing in Europe,” says Busby. “According to the European Commission, the EU already commands 10 percent of the global microchip market, and the European Chips Act mobilizes more than 43 billion EUR of investments into the sector. Trelleborg is well placed to take advantage of the sector’s shift into more global manufacturing.”

 

The acquisition of MNE brings NanoPure into Trelleborg’s portfolio of semiconductor materials. This perfluoroelastomer (FFKM) will join Trelleborg’s already recognized range of specialist Isolast FFKM materials.

 

“Whereas standard elastomer materials are sufficient for a large proportion of applications in other industries, FFKM is the chosen elastomer material for many semiconductor products,” Busby explains. “It combines the elasticity of an elastomer with the chemical resistance of a polytetrafluoroethylene (PTFE) material and is the gold standard of elastomer materials.” 

 

The purity and unique properties of FFKM materials extend the life ofseals, supporting FABs in minimizing downtime for planned maintenance, which is critical to maximizing output and profitability.  

 

“The process chemicals in semiconductor manufacturing are so harsh they can destroy standard elastomer seals in hours,” says Busby. “Using FFKM seals can extend life to weeks.” 

 

Although expanding material offerings was important to Trelleborg, it was not the main driver for the acquisition. “Synergies are the key,” says Busby. “MNE brings established customer contacts with some of the most significant manufacturers in one of the largest local markets for semiconductors globally. Cross-selling our products into MNE’scustomers is one thing that we’re already starting to do.

 

“The local Asian production capacity, along with strong R&D resources we now have, shortens lead times and brings our capabilities closer to our customers. This provides a firm foundation for expansion into Asia and other markets.”

 

 

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