Global Semiconductor Chips For Automotive Market To Reach USD 32.81 Billion by 2028

The semiconductor chips for the automotive market are expected to reach USD 32.81 Billion by 2028, growing at a CAGR of 7.5% from 2021 to 2028. The increasing awareness of shared connectivity & mobility coupled with rising demand for fully autonomous cars and smart parking systems are anticipated to augment the growth of semiconductor chips for the automotive market within the forecast period.

Key Findings:    

• Demand for chips is more than that of the current supply. There has also been a subsequent increase in chip prices. Numerous automobile manufacturers across the world have said that production has been affected due to the shortage in supply
• Owing to these export restrictions, SMIC had to reconfigure its supply chains. Meanwhile, companies buying their chips from SMIC had to switch to other chip manufacturers. However, it was observed that these chip makers were already at full capacity and were not able to fulfill the required demand
• The analog ICs segment is projected to grow at a CAGR of over 6.21% over the forecast period. This is owing to the increasing adoption of high-tech features in luxury vehicles
• The telematics & infotainment segment held a market share of around 26.51% in 2020. This share is due to the increasing technological developments in the automotive industry. Furthermore, the increasing demand for navigation systems is also supporting the growth of the overall segment
• The passenger vehicles segment is projected to hold a market share of around 65.14% in 2020. This is attributable to the rising middle-class population and increased disposable income of the consumers in various economies
• Europe is expected to expand at a CAGR of over 3.2% from 2021 to 2028. This surge is attributed to the presence of major luxury car manufacturers like AUDI, Porsche, and Volkswagen in the region

Some of the key players in semiconductor chips for the automotive market include Texas Instruments Inc., NXP Semiconductors, STMicroelectronics N.V., Microchip Technology Inc., Infineon Technologies AG, NVIDIA CORPORATION, Micron Technology, Inc., ON Semiconductor, Renesas Electronics, and Maxim Integrated Products, Inc., among others.

The rising demand for autonomous vehicles and smart parking systems owing to the increasing urbanization and industrialization is anticipated to augment the growth of the semiconductor chips for the automotive market in the years to come. The rise in the percentage of vehicles used by a huge population has contributed to traffic and parking problems in most of the urban areas. This has resulted in the rapid development of public transport facilities. Most of the economies are currently developing projects that focus on inter-city public transport systems to move traffic in a more convenient, faster, and less expensive manner, thus driving the market for these services. Moreover, the improving economy of several countries worldwide due to the industrialization has resulted in rising in the disposable income of consumers. This has increased the sales of passenger cars which is further expected to further support the growth of the market in near future. The increasing autonomous vehicle is also expected to augment the growth of the semiconductor chips for the automotive market. The innovation of autonomous vehicles has successively decreased the complexity of driving, with features such as lane monitoring, emergency braking, stability controls, and others. The increasing focus on autonomous vehicle systems has altered the demand patterns for automotive semiconductors due to the sales of specialty silicon chips that are custom-made to specific applications only. These customized chips are manufactured only in a few semiconductor companies, and some OEMs are also now focussing on designing them in-house in order to decrease development timelines and gain more control. Furthermore, the implementation of Advanced Driver Assistance Systems (ADAS) in vehicles for instant processing of data while reacting to unexpected changes also requires multiple interconnections within the vehicle and high-performance chips. This in turn is expected to support the growth of the market within the estimated timeframe.

The Asia Pacific is projected to hold the largest shares in 2020. This is attributable to the increasing production of vehicles in economies like India, China, and Japan in the region. Furthermore, the increasing demand for luxurious vehicles is also expected to support the growth of semiconductor chips for the automotive market in the region.