Rising production of electric vehicles, high production volumes of automobiles and growing advanced safety and security needs are anticipated to drive the global automotive semiconductor market. These indicators fuel the demand for the automotive semiconductor market, which is expected to reach $81.40 Billion in 2027, growing at a CAGR of 8.5% from 2020 to 2027, says Brandessence Market Research. In 2020 the size of this market was $45.98 Billion.
Some major key players for global automotive semiconductor industry report cover prominent players Samsung, NXP Semiconductors., SK Hynix, Renesas Electronics, Toshiba Electronic Devices & Storage, Qualcomm Technologies, Fujitsu Semiconductor, STMicroelectronics, Robert Bosch GmbH, Sony Semiconductor Solutions, Infineon Technologies AG, Texas Instruments, Rohm, Analog Devices, Intel Corporation and others.
The utilisation of semiconductors in the automobile business is growing owing to its various new applications. Nowadays, a large part of the car business' improvement proceeds with the inclusion of semiconductor innovation in vehicle designs. Semiconductors are utilised in the Electronic Control Units (ECU) of vehicles, particularly premium traveller vehicles. Semiconductors empower the vast majority of the advancements in automotive improvement as modern cars contain features like mobile phone integration, heads-up displays, comfort, performance, and independent driving guides that need the semiconductor's guide. As vehicles become considerably complex, demand for automotive semiconductors will increase logically and give an incredible long term development motor for the automotive industry. The quickest developing applications of semiconductors in a vehicle are telematics and infotainment and safety and powertrain. Discrete power devices and memory devices are the fastest developing part of the automotive semiconductor industry.
Segments
The global automotive semiconductor market is segmented based on component, vehicle type, fuel, application, region, and country level. Based on the component, the automotive semiconductor market is classified into processors, analogue IC, sensors, discrete power device, memory device and lightning device. In terms of vehicle type, the market is divided into Light Commercial Vehicle (LCV), Heavy Commercial Vehicle (HCV) and passenger car. Based on the fuel, the automotive semiconductor market is classified into gasoline, diesel and electric/hybrid electric vehicle (EV/HEV) and in terms of application, the market is classified into power electronics, chassis, safety, body electronics, comfort/ entertainment units and others.
Major factors
One of the major factors driving the growth of the global automotive semiconductor market is the growing production of electric vehicles globally. According to The International Council on Clean Transportation (ICCT), global EV production surpassed two million per year in 2018 and sold over 80,000 EVs per year. In addition, elevated production of automobiles is also supplementing the market growth.
For instance, the number of automobile users is rapidly increasing day by day, which may accelerate the demand for semiconductors for vehicle productions. Furthermore, rising advanced safety and security needs also augment the growth of the global automotive semiconductor market in the forecast period. For example, for self-driving cars, security began in semiconductors. The hundreds of composite chips within vehicles have to be protected against electrical faults that could damage the system following advanced features like accident avoidance and lane-change warnings. Automotive applications are spawning the development of a host of sensor types and airbags for use in systems associated with rider safety and vehicle diagnostics or monitoring. Thus, the demand for advanced safety security needs is fostering the growth of the market during the forecast period.
However, the high cost of the vehicle and continuous optimisation of component size may hamper the global automotive semiconductor market growth. Despite that, rising preference towards the hybrid and electric vehicles and the adoption of advanced automotive semiconductors can offer more opportunities for the further growth of the global automotive semiconductor market.
North America to dominate
North America is expected to dominate the global automotive semiconductor market due to the adoption of automated safety technologies, growing production of EVs and presence of key players in this region. According to National Highway Traffic Safety Administration, in the US, the continuing evolution of automotive technology is aiming to deliver greater safety benefits and automated driving systems (ADS). For instance, Texas Instruments is an American pioneer in the semiconductor space, presently offering best in class solution for Sensor combination, Radar, Camera, Lidar and Ultrasound applications.
Asia-pacific
Asia-pacific is expected to emerge as the fastest growing market over the forecast period due to the increasing growth of the automotive industry, especially in emerging countries such as India, Japan, and China. As per the NITI Aayog report, in India, about 7.35 million electric vehicles were extended in 2020 and expected to develop 26.52 million by 2030. Also, leading semiconductors manufacturers in this region are fostering the market growth. For example, Toshiba offers various automotive semiconductor devices, including image recognition processors designed to develop driving security. It provides leading-edge semiconductor technologies from a future perspective to deliver comprehensive driver assistance solutions that imitate human eyes and other complicated human senses.
During the COVID-19 pandemic, the automotive semiconductor market sees a negative impact as the major automotive fabricating plants have stopped their production in response to lockdown by numerous countries worldwide. In addition, COVID-19 caused an unrealistic disturbance in the production and supply chain network. This essentially influenced capital and R&D investments. Also, government-imposed restrictions on transportation endured a boycott that influenced the Just in Time strategies, which ended the production plans prompting standing by and even plan closure, the report said.
Courtesy: Brandessence Market Research & Consulting
Photo courtesy: Renesas