Automotive Semiconductor Market 2024 – Segments Analysis, Industry Trends, Manufacturers Analysis, Opportunities and Market Size & Forecast 2030

The global automotive semiconductor market was valued at USD 65.5 billion in 2022, and a CAGR of 6.9% is expected during the forecast period. The rise in adoption of electric and hybrid vehicles and the development of highly autonomous vehicles is driving growth in the market significantly. EVs require advanced chips for battery management, power electronics, and energy-efficient powertrains.

ADAS technologies such as collision avoidance, lane departure warnings, and adaptive cruise control rely heavily on sensors, processors, and cameras, all of which require sophisticated semiconductor components. The push towards fully autonomous vehicles is a major driver. Self-driving cars use various sensors, radar, Lidar, and AI-powered computing platforms, which is increasing the demand for high-performance chips.

Growth Drivers

Modern vehicles are increasingly connected, offering features like in-car entertainment, internet connectivity, and real-time navigation. These systems rely on semiconductors for processing data and ensuring smooth functionality. Increasing use of a wide range of sensors, including temperature, pressure, proximity, and the development of V2X technologies, which enable vehicles to communicate with other vehicles, infrastructure, and networks, is driving the demand for semiconductors to ensure real-time data exchange and enhance road safety.

Automotive systems now utilize a wide range of sensors, including temperature, pressure, proximity, and image sensors, for various applications like fuel efficiency, safety, and comfort. Governments worldwide are implementing stricter emission standards and fuel efficiency regulations, pushing automakers to adopt semi-conductors-based solutions. Integration of 5G and the internet of things in automotive technology is increasing the need for advanced chips to handle the massive data volumes and connectivity demands. Consumer demand for personalized driving experience is driving the need for more sophisticated in-vehicle electronics, which rely on semi-conductors.

Many governments are offering subsidies and incentives for EV adoption, further fueling semiconductor demand as EVs require more chips than conventional internal combustion engine vehicles. Increasing electronic content in automotive is also driving growth in the market significantly. The use of semiconductors in electric and hybrid cars has increased significantly. The growing automotive market is representing huge opportunities for automotive semiconductors to support battery performance in electric vehicles.

Increasing automobile construction in several countries in the world is also driving growth in the market significantly. Increasing integration of AI in vehicles is driving growth in the market.

Segmentation

By Component

·         Processor

·         Analog IC

·         Discrete Power Device

·         Sensor

·         Memory Device

·         Others

By Vehicle Type

·         Passenger Cars

·         Commercial Vehicles

By Propulsion

·         ICE

·         Electric

By Application

·         Powertrain

·         Safety

·         Body Electronics

·         Chassis

·         Telematics and Infotainment

Regional Outlook

·         Asia Pacific

·         North America

·         Latin America

·         Middle East and Africa

·         Europe

Automotive Semiconductor Market by Vehicle Type Segmentation

On the basis of the vehicles, the automotive semiconductor market is segmented into passenger cars and commercial vehicles. The passenger car segment led the market till 2023 and is expected to grow significantly during the forecast period. Rising adoption of automotive entertainment systems in passenger vehicles is driving growth in the market.

Passenger cars are produced in significantly higher volumes compared to commercial vehicles like trucks and buses. This larger production scale leads to a higher demand for automotive semiconductors. Modern passenger cars are increasingly equipped with ADAS, including features like adaptive cruise control, lane-keeping assist, and automated parking. Increasing demand for processing data from sensors, cameras, and radars is the need of the hour. Push towards electrification with more electric and hybrid vehicles required complex electronic control units and other semiconductor components to manage battery systems, inverters, and charging systems.

Demand for enhanced infotainment systems, connected car features, and in-car entertainment systems is higher in passenger cars. Regulations concerning emissions and safety are pushing automakers to integrate more sophisticated electronic systems in passenger cars. Growing consumer demand for advanced features such as digital dashboards, head-up displays, and autonomous driving capabilities. The passenger cars segment constitutes the largest portion of the global automotive market in terms of units sold, especially in regions like Asia Pacific, Europe, and North America. These factors combine to make passenger cars a leading segment in the market.

Regional Outlook

On the basis of the regions, the automotive semiconductor market is segmented into 5 parts: Asia Pacific, North America, Latin America, the Middle East and Africa, and Europe. Asia Pacific is the leading segment in the market due to the presence of technologically advanced countries like China, Japan, and South Korea. This region is the largest hub for automotive production and sales.

The region is home to major automotive manufacturers like Toyota, Hyundai, and Honda, which are key players in the development and production of automotive semiconductors. China is the world’s largest market for electric vehicles, which require a higher number of semiconductors compared to traditional internal combustion. Asia Pacific is at the forefront of integrating advanced technologies like ADAS entertainment systems. Many governments in the Asia-Pacific region have implemented favorable policies and incentives to boost the production and adoption of electric and smart vehicles, further increasing the demand for automotive semiconductors.

North America, especially the United States, is also a significant market for automotive semiconductors, particularly due to its emphasis on advanced vehicle technologies and ADAS. The presence of many key players in this region is driving growth in the market. The increasing number of electric vehicles is the key factor behind significant growth in the market.

Rising disposable income in the American region, especially in the United States of America and Canada, is driving the demand for the automotive semiconductor market. Stricter safety and emission regulation are pushing the adoption of electronic systems in vehicles, which in turn increase the demand for automotive semiconductors. Increasing demand for luxury vehicles in the North American market with more advanced infotainment connectivity and safety features, all of which require high-performance semiconductors.

Europe has some of the world's most stringent environmental regulations; this has driven automakers to adopt electric and hybrid vehicles, increasing the demand for power semiconductor and battery management systems. Europe is home to several automotive manufacturers like Volkswagen, BMW, and Daimler. 

Key Players

·         Robert Bosch GmbH

·         Toshiba Corporation

·         Texas Instruments Corporation

·         Denso Corporation

·         Renesas Electronic Corporation

·         Infineon Technologies AG

·         ROHM CO. Ltd.

·         On Semiconductor Corporation

·         NXP Semiconductors

·         Other Players