This transformation is creating a strong foundation for long-term market growth. The global industrial gases market is expected to reach US$99.5 billion in 2026 and expand to US$142.8 billion by 2033, reflecting a CAGR of 5.3% during the forecast period. Oxygen continues to lead the market with nearly 31% share, while the chemical industry remains the largest end user at over 27% in 2026. At the same time, the electronics sector is emerging as the fastest-growing segment, exhibiting rising investments in semiconductor manufacturing and advanced industrial infrastructure.
Semiconductor Purity Requirements Are Pushing Gas Plants onto the Fab Floor
Inside a semiconductor fab, every step has to be precise. A tiny impurity or a delayed gas supply can disrupt production, turning reliability into a critical part of chip manufacturing. To avoid these risks, chipmakers are now turning to gas suppliers that can produce gases on or near their fabrication facilities, reducing dependence on deliveries from distant plants.
The shift is already visible in major semiconductor hubs. On July 31, 2026, Linde announced a US$1 billion investment to expand its existing on-site gas complex in Phoenix, Arizona. The project will add two new SPECTRA air separation units to support one of the world's largest semiconductor manufacturers as it expands its Phoenix operations. With three units already operating at the site, the investment shows how closely gas production is becoming integrated with chip manufacturing.
AI Infrastructure Growth is Turning Single-customer Plants into Multi-industry Hubs
As semiconductor production expands, the need for reliable gas supply is spreading beyond individual fabs. The rapid buildout of AI infrastructure and data centers is creating new pockets of demand, giving gas producers a reason to look beyond serving a single customer. Instead, they are increasingly positioning new facilities to serve several industries in the same technology corridor.
This shift is already taking shape in Albany, New York. On May 6, 2026, CHARBONE Corporation opened its first U.S. hydrogen hub, designed to supply ultra-high-purity hydrogen to semiconductor, artificial intelligence, healthcare, aerospace, and advanced manufacturing customers across the Northeast technology corridor. Rather than building a plant around one buyer, the model creates a shared supply base for multiple industries, marking a broad shift in how industrial gas infrastructure is being developed.
Surging Shift Toward On-site Hydrogen is Creating New Avenues
As more industries look for a reliable and clean gas supply, the question is becoming simple, i.e., why transport hydrogen long distances when it can be produced where it is needed? The industrial hydrogen market is valued at US$128.9 billion in 2026 and is projected to reach US$179 billion by 2033, with on-site production already accounting for nearly 62% of the global share. High transportation costs and the technical challenges of moving hydrogen are encouraging more businesses to generate it directly at their facilities.
The shift is now reaching industries far beyond semiconductors and healthcare. For example, in March 2025, INOX Air Products commissioned India's first green hydrogen plant for the float glass industry at Asahi India Glass's facility in Rajasthan. Powered by solar energy, the plant can produce up to 190 tons of green hydrogen annually and is expected to reduce about 1,250 tons of CO2 emissions each year. The project shows how on-site, low-carbon hydrogen is finding a place in traditional manufacturing as well as high-tech industries.
The Next Wave of Growth Depends on Decentralized Infrastructure
The direction for Linde, Air Liquide, Air Products, and new entrants such as CHARBONE Corporation is very clear. Growth will likely favor whichever supplier can put a plant closest to the customer's own operations, whether that customer is a chip fab, a hospital, or a glass manufacturer.
Companies that can replicate the corridor-hub model CHARBONE has pursued in Albany, or extend hospital-grade on-site oxygen programs like Zambia's into more public health systems, stand to build long-duration contracts well before competitors catch up. As decarbonization pressure adds hydrogen into the same on-site conversation, suppliers with both the capital and the engineering speed to build fast, purpose-built plants are best positioned to capture the next phase of demand across healthcare, electronics, and industrial manufacturing alike.
