Automotive Semiconductor Global Market Opportunities and Strategies to 2033

This report describes and explains the automotive semiconductor market and covers 2018-2023, termed the historic period, and 2023-2028, 2033F termed the forecast period. The report evaluates the market across each region and for the major economies within each region.

The global automotive semiconductor market reached a value of nearly $52.19 billion in 2023, having grown at a compound annual growth rate (CAGR) of 6% since 2018. The market is expected to grow from $52.19 billion in 2023 to $86.18 billion in 2028 at a rate of 10.6%. The market is then expected to grow at a CAGR of 11.5% from 2028 and reach $ 148.66 billion in 2033.

Growth in the historic period resulted from the steady expansion of the automotive industry, increasing popularity of autonomous vehicles and rising use of electronic components in the automotive industry. Factors that negatively affected growth in the historic period were the increasing cost of raw materials used in automobiles and worldwide semiconductor chip shortage.

Going forward, growing demand for electric vehicles (EVs) and hybrid electric vehicles (HEVs), increasing investment in automotive semiconductors research and development, increasing government initiatives for automotive and auto parts manufacturing and growth in the automotive aftermarket industry will drive the growth. Factor that could hinder the growth of the automotive semiconductor market in the future include restrictions on free trade and restrictions on export of gallium and germanium metals.

The automotive semiconductor market is segmented by component into processor, analog IC (integrated circuits), discrete power, sensor, memory and other components. The processor market was the largest segment of the automotive semiconductor market segmented by component, accounting for 27.8% or $23.16 billion of the total in 2023. Going forward, the discrete power segment is expected to be the fastest growing segment in the automotive semiconductor market segmented by component, at a CAGR of 12.3% during 2023-2028.

The automotive semiconductor market is segmented by vehicle type into passenger vehicle, light commercial vehicle and medium and heavy commercial vehicle. The passenger vehicle market was the largest segment of the automotive semiconductor market segmented by vehicle type, accounting for 64.7% or $33.77 billion of the total in 2023. Going forward, the light commercial vehicle segment is expected to be the fastest growing segment in the automotive semiconductor market segmented by vehicle type, at a CAGR of 10.9% during 2023-2028.

The automotive semiconductor market is segmented by application into powertrain, safety, body electronics, chassis and telematics and infotainment. The safety market was the largest segment of the automotive semiconductor market segmented by application, accounting for 26.4% or $13.8 billion of the total in 2023. Going forward, the telematics and infotainment segment is expected to be the fastest growing segment in automotive semiconductor market segmented by application, at a CAGR of 11.9% during 2023-2028.

The automotive semiconductor market is segmented by propulsion type into internal combustion engine, electric and hybrid. The internal combustion engine market was the largest segment of the automotive semiconductor market segmented by propulsion type, accounting for 86.8% or $45.32 billion of the total in 2023. Going forward, the electric segment is expected to be the fastest growing segment in the automotive semiconductor market segmented by propulsion type, at a CAGR of 12.7% during 2023-2028.

Asia-Pacific was the largest region in the automotive semiconductor market, accounting for 43.4% or $22.67 billion of the total in 2023. It was followed by North America, Western Europe and then the other regions. Going forward, the fastest-growing regions in the automotive semiconductor market will be Asia-Pacific and North America where growth will be at CAGRs of 11.6% and 10.2% respectively. These will be followed by Western Europe and Eastern Europe where the markets are expected to grow at CAGRs of 9.9% and 9.6% respectively.

The global automotive semiconductor market is concentrated, with a few players operating in the market. The top ten competitors in the market made up 42.55% of the total market in 2022. Infineon Technologies AG was the largest competitor with a 7.96% share of the market, followed by STMicroelectronics N.V. with 6.70%, NXP Semiconductors N.V. with 4.91%, Renesas Electronics Corp. with 4.73%, Texas Instruments, Inc. with 4.70%, Analog Devices, Inc. with 3.99%, Micron Technology with 2.67%, Robert Bosch GmbH with 2.59%, Denso Corporation with 2.31% and TE Connectivity with 2.00%.

The top opportunities in the automotive semiconductor market segmented by component will arise in the processor segment, which will gain $8.63 billion of global annual sales by 2028. The top opportunities in the automotive semiconductor market segmented by vehicle type will arise in the passenger vehicle segment, which will gain $22.06 billion of global annual sales by 2028. The top opportunities in the automotive semiconductor market segmented by propulsion type will arise in the internal combustion engine segment, which will gain $28.47 billion of global annual sales by 2028. The top opportunities in the automotive semiconductor market segmented by application will arise in the safety segment, which will gain $9.48 billion of global annual sales by 2028. The automotive semiconductor market size will gain the most in China at $9.89 billion.

Market-trend-based strategies for the automotive semiconductor market include introduction of starter kits for automotive gateway systems, use of resistive RAM (RRAM) technology to enhance development of automotive semiconductors, development of technologically advanced solutions, innovative product developments with focus on high-bandwidth memory, strategic partnerships and collaborations among market players and focus on advanced power supply technologies.

Player-adopted strategies in the automotive semiconductor market include focus on focus on shaping future mobility through strategic partnerships, strengthening its operational capabilities through strategic partnerships and collaborations, expanding its product portfolio through the launch of innovative products and enhancing its manufacturing capabilities through business expansions.

To take advantage of the opportunities, the analyst recommends the automotive semiconductor companies to focus on leveraging resistive ram technology for advanced automotive semiconductors, focus on advancing automotive semiconductors with cutting-edge technologies, focus on high-bandwidth memory innovation for automotive applications, focus on nano cap power supply technology for enhanced stability, focus on processor and discrete power segments, expand in emerging markets, continue to focus on developed markets, focus on strategic collaborations, provide competitively priced offerings, participate in trade shows and events, continue to use B2B promotions, focus on tailored solutions for electric vehicle manufacturers, focus on passenger vehicle and light commercial vehicle segments and focus on safety and telematics/infotainment application segments.