Southeast Asia SMD Adhesive market was valued at USD 285 million in 2024 and is projected to reach USD 412 million by 2032, growing at a CAGR of 5.4% during the forecast period. This growth trajectory is fueled by increasing electronics manufacturing across Vietnam, Thailand, and Malaysia, coupled with rising demand for compact surface-mount device solutions.

SMD adhesives are specialized bonding materials used in surface-mount technology (SMT) applications for electronic components. These adhesives provide mechanical attachment, thermal conductivity, and electrical insulation for components like capacitors, resistors, and ICs mounted on printed circuit boards (PCBs). The market primarily comprises epoxy-based and polyene organic formulations, each offering distinct viscosity, cure speed, and thermal resistance properties.

Key growth drivers include expanding 5G infrastructure deployment requiring high-frequency PCB assemblies, alongside booming consumer electronics production in the region. Automotive electronics modernization—particularly in EV manufacturing hubs like Indonesia and Thailand—is further accelerating demand for high-temperature resistant SMD adhesives. Recent capacity expansions by major PCB manufacturers in Malaysia (18% production increase in 2023) indicate sustained market potential.

MARKET DYNAMICS

MARKET DRIVERS

Growth in Consumer Electronics Manufacturing to Drive SMD Adhesive Demand

The exponential growth of consumer electronics manufacturing in Southeast Asia is a key driver for the SMD adhesive market. Countries like Thailand, Vietnam, and Malaysia have become global hotspots for electronics production, accounting for over 30% of regional electronics exports. Surface mount device (SMD) adhesives are critical components in PCB assembly for smartphones, wearables, and IoT devices. With consumer electronics production volumes increasing by approximately 8-10% annually across the region, demand for high-performance conductive and non-conductive adhesives continues to rise. Recent technological advancements requiring finer pitch components below 0.3mm are further pushing the need for precision dispensable adhesives with superior thermal and mechanical properties.

Automotive Electronics Expansion Creating New Application Segments

The automotive sector presents significant growth opportunities, driven by increasing vehicle electrification across Southeast Asia. Modern vehicles contain over 3,000 electronic components requiring reliable bonding solutions, with adhesive usage per vehicle expected to grow by 40% by 2025. Government initiatives promoting electric vehicles across Thailand, Indonesia, and Malaysia are accelerating this trend. SMD adhesives play crucial roles in advanced driver assistance systems (ADAS), infotainment units, and battery management systems where they must withstand automotive-grade temperature cycling and vibration requirements.Thailand's 30@30 policy aims for 30% of domestic auto production to be electric by 2030, creating substantial downstream demand for electronic adhesives.Additionally, ASEAN's position as a global automotive production hub, manufacturing over 4 million vehicles annually, ensures sustained demand for specialized adhesives in both conventional and electric vehicle applications.

MARKET RESTRAINTS

Raw Material Price Volatility Impacting Profit Margins

The SMD adhesive market faces significant pressure from fluctuating raw material costs, particularly for epoxy resins and silver fillers used in conductive formulations. Epoxy resin prices have shown volatility of 15-20% quarterly since 2021 due to supply chain disruptions and petrochemical feedstock instability. Silver prices, crucial for electrically conductive adhesives, reached decade-high levels in 2023, increasing production costs by approximately 35% for premium formulations.

Additional Constraints

Regulatory Compliance Challenges

Stringent environmental regulations regarding VOC emissions and hazardous substances require continuous formulation adjustments. REACH and RoHS compliance adds 10-15% to development costs for adhesive manufacturers targeting European supply chains via Southeast Asian production bases.

Technology Transition Risks

The shift towards lead-free and halogen-free formulations requires significant R&D investment, with smaller regional players struggling to keep pace with multinational corporations' technical capabilities and certification budgets.

MARKET CHALLENGES

Technical Limitations in High-Density Applications

Advanced packaging technologies like 3D IC and chip-on-board configurations present significant technical challenges for existing SMD adhesive formulations. Miniaturization trends demand adhesives capable of maintaining bond integrity in spaces below 50μm while withstanding reflow temperatures exceeding 260°C. Current epoxy-based systems face limitations in ultra-fine pitch applications, with delamination rates increasing by approximately 3.5% for every 0.1mm reduction in component spacing.

Additionally, the industry faces a growing skills gap, with fewer than 30% of regional technical personnel fully trained in next-generation adhesive application techniques. This knowledge deficit creates quality consistency issues in high-mix production environments.

MARKET OPPORTUNITIES

Emerging 5G Infrastructure Projects Creating New Demand

Southeast Asia's rapid 5G network deployment presents substantial opportunities for specialized SMD adhesives. Telecom infrastructure projects across the region require adhesives with superior high-frequency performance and thermal conductivity properties. The ASEAN 5G implementation roadmap anticipates over 15,000 new base stations annually through 2026, each utilizing approximately 40% more adhesive-dependent components than 4G equivalents.

Advanced Materials Development

Innovations in thermally conductive but electrically insulating adhesives are gaining traction, particularly for power electronics in renewable energy applications. New silicone-based formulations demonstrate 25% better thermal cycling performance than conventional epoxies, addressing critical reliability requirements in solar inverters and EV charging systems.

MARKET TRENDS

Rising Demand for Miniaturized Electronics to Drive Market Growth

Southeast Asia SMD adhesive market is witnessing robust growth, primarily driven by the escalating demand for miniaturized electronic components across industries. With consumer electronics shrinking in size while increasing in functionality, surface mount device (SMD) adhesives have become critical for securing tiny components on printed circuit boards. Recent data indicates adhesive consumption in this sector grew by approximately 9-12% annually between 2018-2022. The trend is accelerating as 5G infrastructure rollout requires high-performance adhesives that can withstand thermal cycling while maintaining strong bonds in compact devices.

Other Trends

Automotive Electrification Momentum

Automotive applications are emerging as a key growth segment, with electric vehicle production volumes in Southeast Asia projected to triple by 2027. This creates substantial demand for specialized SMD adhesives capable of withstanding high-temperature environments in battery management systems and power electronics. Major automotive electronics manufacturers are increasingly specifying polyene organic SMD adhesives for their superior thermal conductivity and resistance to automotive fluids, a segment growing at 15-18% CAGR in the region.

Supply Chain Localization Initiatives

Regional governments are actively promoting electronics component localization, creating favorable conditions for SMD adhesive suppliers. Malaysia's National Semiconductor Strategy and Thailand's EEC (Eastern Economic Corridor) initiative are catalyzing domestic adhesive production. Recent investments exceeding $2 billion in new adhesive manufacturing facilities across Vietnam, Thailand, and Malaysia indicate strong market confidence. Local formulations are gaining traction because they offer shorter lead times and better compatibility with regional environmental regulations compared to imported alternatives.

Technological Advancements in Adhesive Formulations

Material science breakthroughs are introducing next-generation SMD adhesives with optimized properties. Novel epoxy-ceramic hybrid formulations demonstrate 40-50% better thermal conductivity while maintaining excellent electrical insulation – critical for power electronics applications. Meanwhile, UV-curable adhesives are gaining adoption in high-volume production lines due to their rapid curing times and reduced energy consumption. These innovations directly address manufacturers' needs for higher throughput and reliability in increasingly complex PCB assemblies.

COMPETITIVE LANDSCAPE

Key Industry Players

Leading Companies Compete Through Innovation and Expansion in Southeast Asia's Growing SMD Adhesive Market

 Southeast Asia SMD (Surface Mount Device) adhesive market features a mix of global chemical giants and regional specialists competing in this rapidly growing segment. Henkel AG & Co. KGaA emerges as a dominant force, leveraging its technologically advanced epoxy and polyurethane adhesive formulations that cater to the region's booming electronics manufacturing sector. The company's recent expansion of production facilities in Malaysia and Vietnam strengthens its local presence.

3M Company and Dow Chemical Company jointly account for approximately 28% of the regional market share (2023 estimates), benefiting from their established distribution networks and trusted brand reputation among electronics manufacturers. These companies are investing heavily in R&D to develop next-generation adhesives with improved thermal conductivity and miniaturization capabilities to meet evolving industry requirements.

Japanese specialists like Toray Industries and Shin-Etsu Chemical are gaining traction with their high-performance polyimide adhesives, particularly in the automotive electronics segment. Their success stems from strategic partnerships with Japanese OEMs expanding production in Thailand and Indonesia.

The market also sees growing competition from South Korean players like LG Chem, which introduced specialized conductive adhesives for flexible printed circuit boards in 2023. Meanwhile, regional manufacturers are carving out niche positions by offering cost-effective solutions for low- to mid-range consumer electronics production.

List of Key SMD Adhesive Companies Profiled

• Henkel AG & Co. KGaA (Germany)

• 3M Company (U.S.)

• Dow Chemical Company (U.S.)

• Toray Industries (Japan)

• Shin-Etsu Chemical (Japan)

• LG Chem (South Korea)

• Panasonic Corporation (Japan)

• Hitachi Chemical Co., Ltd. (Japan)

• Hexion Inc. (U.S.)

• Namics Corporation (Japan)

Henkel AG & Co. KGaA (Germany)

3M Company (U.S.)

Dow Chemical Company (U.S.)

Toray Industries (Japan)

Shin-Etsu Chemical (Japan)

LG Chem (South Korea)

Panasonic Corporation (Japan)

Hitachi Chemical Co., Ltd. (Japan)

Hexion Inc. (U.S.)

Namics Corporation (Japan)

Segment Analysis:

By Type

Epoxy SMD Adhesive Segment Dominates Due to High Thermal and Chemical Resistance

The Southeast Asia SMD Adhesive market is segmented based on type into:

• Epoxy SMD Adhesive

Epoxy SMD Adhesive

• Polyene Organic SMD Adhesive

• Acrylic SMD Adhesive

• Silicone SMD Adhesive

• Others

Polyene Organic SMD Adhesive

Acrylic SMD Adhesive

Silicone SMD Adhesive

Others

By Application

Consumer Electronics Segment Leads Owing to Growing Demand for Miniaturized Components

The market is segmented based on application into:

• Consumer Electronics

Consumer Electronics

• Automotive Electronics

• Telecommunications

• Industrial Electronics

• Others

Automotive Electronics

Telecommunications

Industrial Electronics

Others

By Technology

UV Curing Technology Gains Traction Due to Faster Processing Speed

The market is segmented based on curing technology into:

• UV Curing

• Thermal Curing

• Moisture Curing

• Others

UV Curing

Thermal Curing

Moisture Curing

Others

By End-User

Electronics Manufacturers Represent Major Demand Segment

The market is segmented based on end-users into:

• Original Equipment Manufacturers (OEMs)

• Electronics Manufacturing Services (EMS)

• Component Suppliers

• Others

Original Equipment Manufacturers (OEMs)

Electronics Manufacturing Services (EMS)

Component Suppliers

Others

Report Scope

This report presents a comprehensive analysis of the Southeast Asia market for Surface Mount Device (SMD) Adhesives, covering the period from 2023 to 2030. It includes detailed insights into the current market status and outlook across key Southeast Asian countries, with specific focus on:

• Sales volume and revenue forecasts (2023-2030)

• Detailed segmentation by product type and application

Sales volume and revenue forecasts (2023-2030)

Detailed segmentation by product type and application

In addition, the report offers in-depth profiles of key industry players, including:

• Company profiles

• Product specifications and formulations

• Production capacities and regional sales

• Revenue breakdown, pricing strategies, and gross margins

• Market share and competitive positioning

Company profiles

Product specifications and formulations

Production capacities and regional sales

Revenue breakdown, pricing strategies, and gross margins

Market share and competitive positioning

The report thoroughly examines the competitive landscape, identifying major suppliers and analyzing the key factors expected to influence market growth. Primary research included surveys with SMD adhesive manufacturers and industry experts across Southeast Asia, covering:

• Revenue patterns and demand fluctuations

• Product innovations and technological developments

• Strategic initiatives and growth drivers

• Supply chain challenges and regulatory hurdles

Revenue patterns and demand fluctuations

Product innovations and technological developments

Strategic initiatives and growth drivers

Supply chain challenges and regulatory hurdles

FREQUENTLY ASKED QUESTIONS:

What is the current market size of Southeast Asia SMD Adhesive Market?

-> Southeast Asia SMD adhesive market was valued at USD 285 million in 2024 and is projected to reach USD 412 million by 2032, growing at a CAGR of 5.4%.

Which key companies operate in Southeast Asia SMD Adhesive Market?

-> Major players include Henkel AG, 3M Company, Dow Chemical, H.B. Fuller, and DELO Industrial Adhesives, along with regional leaders like Namics Corporation and ThreeBond Holdings.

What are the key growth drivers?

-> Growth is primarily driven by electronics manufacturing expansion, automotive sector demand, and increasing adoption of advanced adhesives in consumer electronics across Southeast Asia.

Which country dominates the regional market?

-> Vietnam currently shows the fastest growth rate, while Singapore maintains technological leadership in high-performance adhesive applications.

What are the emerging trends?

-> Notable trends include development of lead-free formulations, UV-curable adhesives, and thermally conductive SMD adhesives for advanced electronics applications.

Table of content

1 STUDY COVERAGE
1.1 SMD Adhesive Product Introduction
1.2 Market by Type
1.2.1 Southeast Asia SMD Adhesive Market Size Growth Rate by Type, 2017 VS 2021 VS 2028
1.2.2 Type1
1.2.3 Type2
1.3 Market by Application1.3.1 Southeast Asia SMD Adhesive Market Size Growth Rate by Application, 2017 VS 2021 VS 2028
1.3.2 Application 1
1.3.3 Application 2
1.4 Southeast Asia SMD Adhesive Sales Estimates and Forecasts 2017-20281.5 Southeast Asia SMD Adhesive Hydrocephalus Shunts Revenue Estimates and Forecasts 2017-2028
1.6 Study Objectives
1.7 Years Considered

2 COMPETITION BY MANUFACTURERS
2.1 Southeast Asia SMD Adhesive Sales by Manufacturers
2.1.1 Southeast Asia SMD Adhesive Sales by Manufacturers (2017-2022)
2.1.2 Southeast Asia SMD Adhesive Sales Market Share by Manufacturers (2017-2022)
2.1.3 Top Largest Manufacturers of SMD Adhesive in 2021 in Southeast Asia
2.2 Southeast Asia SMD Adhesive Revenue by Manufacturers
2.2.1 Southeast Asia SMD Adhesive Revenue by Manufacturers (2017-2022)
2.2.2 Southeast Asia SMD Adhesive Revenue Market Share by Manufacturers (2017-2022)
2.2.3 Southeast Asia Top Companies by SMD Adhesive Revenue in 2021
2.3 Southeast Asia SMD Adhesive Sales Price by Manufacturers (2017-2022)
2.4 Analysis of Competitive Landscape
2.4.1 Manufacturers Market Concentration Ratio (CR3 and HHI)
2.4.2 Southeast Asia SMD Adhesive by Company Type (Tier 1, Tier 2, and Tier 3)
2.4.3 Southeast Asia SMD Adhesive Manufacturers Geographical Distribution
2.5 Mergers & Acquisitions,

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