Automotive Semiconductor Market Analysis by Propulsion Type (Electric and Internal Combustion Engine); by Component (Analog IC, Processor, Discrete Power, Sensor, and Memory); by Vehicle Type (Passenger Vehicle, Light Commercial Vehicle, and Heavy Commercial Vehicle); and by Application (Body Electronics, Chassis, Powertrain, Safety, and Telematics & Infotainment) – Global Supply & Demand Analysis & Opportunity Outlook 2023 – 2035
Buy Now Report ID: 4158 | Published Date: Apr 21, 2023
Automotive Semiconductor Market size is estimated to garner a revenue of ~USD 115 billion by the end of 2035 by growing at a CAGR of ~10% over the forecast period, i.e., 2023 – 2035. Further, the market generated a revenue of ~USD 40 billion in the year 2022. The growth of the market can primarily be attributed to the rising use of innovative technologies in the automotive sector, along with the growing demand for automotive semiconductors worldwide. It is estimated that the average modern vehicle can have over 1,200 different semiconductor chips.
Today, most technologically advanced automobiles manufactured, use semiconductor devices for several critical functions such as power management, displays and control, sensing, and safety features of the vehicle. The critical charging infrastructure necessary to make electric vehicles viable is created by semiconductors in the form of power devices and solar cells. Automotive semiconductors have more applications in hybrid and electric vehicles (EVs), which are growing significantly, and are expected to create massive revenue generation opportunities for the key players operating in the global automotive semiconductor market during the forecast period. It was found that the global sales of electric cars in the first quarter of 2022, were ~2 million.
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Base Year |
2022 |
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Forecast Year |
2023 - 2035 |
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CAGR |
~10% |
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Base Year Market Size (2022) |
~ USD 40 billion |
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Forecast Year Market Size (2035) |
~ USD 115 billion |
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Regional Scope |
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Growth Drivers
Challenges
The global automotive semiconductor market is segmented and analyzed for demand and supply by propulsion type into the electric and internal combustion engines. Amongst these segments, the electric segment is anticipated to garner the largest revenue by the end of 2035. Backed by the growing number of electric vehicles along with the surge in the demand for electric cars worldwide. Electric vehicles play a major role in cutting carbon commission and creating less pollution on the roads. This forces government authorities to bring EVs as they are beneficial for the environment. For instance, it is projected that globally, 1 in 2 cars will have an electric powertrain by 2030. Last year more than 1 million electric cars were produced globally.
The global automotive semiconductor market is segmented and analyzed for demand and supply by application into body electronics, chassis, powertrain, safety, telematics & infotainment. The body electronics segment held the largest market share in 2020 and it is estimated to do so in the forecast year. The leading companies in the automotive business are focusing on safety, convenience, and comfort over style and appearance. Moreover, government rules and strict laws are affecting the market by prioritizing client safety above all. After body electronics, the telematics and infotainment segment is anticipated to hold the highest market share in the forecast period. This can be attributed seeing the technological advancement in the field of cell phones, GPS, and the internet.
Our in-depth analysis of the global automotive semiconductor market includes the following segments:
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By Propulsion Type |
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By Component |
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By Vehicle Type |
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By Application |
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Automotive semiconductor market in the Asia Pacific is projected to hold the largest revenue share by the end of 2035. Backed by the presence of the largest automobile manufacturing network in the region, growing demand for automobiles as well as the rising sale of vehicles. For instance, China sold more than 25 million vehicles in 2020, which included ~19,994,000 cars and about 5,231,000 commercial vehicles. Owing to the presence of emerging economies consisting of India, South Korea, China, and Indonesia, the automotive semiconductor market is growing. As the demand is increasing for luxurious and comfortable vehicles around the globe. Therefore, the leading automobile manufacturers are focusing on the production of semi-luxury and luxury vehicles that solely relies on automotive semiconductor technology. Increasing disposable income of people and growing demand for luxurious life are factors driving the growth of the automotive semiconductor market in the region. China from the Asia Pacific region held the largest share of the automotive semiconductor market. Owing to its fast advancement in cruise control, infotainment system, and other safety features.
On the other hand, the market in Europe is anticipated to share significant growth in the forecast period. This can be attributed to the growing demand for electric vehicles in the region. Currently, automobile manufacturers are aiming at creating, developing, and producing innovative automobile vehicles as they have attracted a set of key potential buyers in the automobile-producing regions. Shortly, automotive semiconductors will play a crucial role in the automobile industry. This can be attributed seeing the demand for technologically advanced and smart vehicles in the market.
In 2023, market players might incur losses due to huge gap in currency translation followed by contracting revenues, shrinking profit margins & cost pressure on logistics and supply chain.
Controlling Inflation has become the first priority for global economies from last quarter of 2022 and to be followed in 2023. With skewed economic situations, rise in interest rate by governments to control spending and inflation, spiked oil and gas prices, high inflation, geo-political issues including U.S. & China trade war, Russia-Ukraine conflict to intensify the global economic issues.
The interest rates in the U.S. may be less sensitive in 2023 as compared to 2022; sigh of relief for businesses. Positive business sentiments, healthy business balance sheets, growth in construction spending (private construction value in 2022 stood at $1,429.2 billion, 11.7 percent (±1.0 percent) above the $1,279.5 billion spent in 2021, Residential construction in 2022 was $899.1 billion, up by 13.3 percent (±2.1 percent) from $793.7 billion in 2021, non-residential construction touched $530.1 billion, 9.1 percent (±1.0 percent) above the $485.8 billion in 2021.) showcases minimal impact of recession in the country.
Similarly, spiked spending in the European and major Asia economics including, India, China & Japan to showcase less impact on the global demand.
Author Credits: Harshita Srivastava, Saima Khursheed
Ans: Upsurge in the number of semiconductor chips in modern vehicles, as well as an increasing number of connected vehicles along with the rising sale of EVs, are some of the major factors anticipated to drive the growth of the automotive semiconductors market.
Ans: The market is anticipated to attain a CAGR of ~10% over the forecast period, i.e., 2023 – 2035.
Ans: Shortages of semiconductors as well as fluctuating prices & availability of raw materials are some of the factors estimated to hamper the market growth.
Ans: The market in Asia Pacific is projected to hold the largest market share by the end of 2035 and provide more business opportunities in the future
Ans: The major players in the market are Analog Devices, Inc., Infineon Technologies AG, NXP Semiconductors N.V., Micron Technology, Inc., Robert Bosch GmbH, and others
Ans: The company profiles are selected based on the revenues generated from the product segment, the geographical presence of the company which determines the revenue generating capacity as well as the new products being launched into the market by the company.
Ans: The market is segmented by propulsion, type, component, vehicle type, application, and by region.
Ans: The electric segment is anticipated to garner the largest market size by the end of 2035 and display significant growth opportunities.
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