Global Automotive Chip Market Size, Share & Trends Analysis Report By Type, By Application, By Vehicle (Passenger Vehicles, and Commercial Vehicles), By Regional Outlook and Forecast, 2024 - 2031

Global Automotive Chip Market Size, Share & Trends Analysis Report By Type, By Application, By Vehicle (Passenger Vehicles, and Commercial Vehicles), By Regional Outlook and Forecast, 2024 - 2031

The Global Automotive Chip Market size is expected to reach $87.1 billion by 2031, rising at a market growth of 11.0% CAGR during the forecast period.

The Asia Pacific region generated 40% revenue share in the automotive chip market in 2023. The region is home to some of the world’s largest automotive manufacturers and a thriving electronics sector, which supports the production of automotive chips. Increased vehicle production, coupled with rising consumer demand for smart and connected vehicles, has significantly boosted the automotive chip market in this region.

The major strategies followed by the market participants are Partnerships as the key developmental strategy to keep pace with the changing demands of end users. For instance, In June, 2024, STMicroelectronics partnered with Airbus, a global pioneer in the aerospace industry, to collaborate on developing power electronics for hybrid and full-electric aircraft systems. The cooperation focuses on Silicon Carbide (SiC) and Gallium Nitride (GaN) devices, essential for powering next-generation aircraft, including urban air vehicles. This partnership will support Airbus' efforts to achieve aircraft electrification and decarbonization goals. Moreover, In August, 2024, Intel Corporation came into partnership with Karma Automotive, a vehicle manufacturer, to develop Software Defined Vehicle Architecture (SDVA) for future vehicles. This partnership would revolutionize vehicle architecture by enhancing efficiency, performance, and flexibility.

KBV Cardinal Matrix - Automotive Chip Market Competition Analysis

Based on the Analysis presented in the KBV Cardinal matrix; Qualcomm Incorporated and Texas Instruments, Inc. are the forerunners in the Automotive Chip Market. In August, 2024, Qualcomm Technologies partnered with Samsung to produce advanced chips for automotive applications, specifically enhancing in-vehicle infotainment and driver-assistance systems. This collaboration features Samsung's LPDDR4X memory chip certified for Qualcomm's Snapdragon Digital Chassis, powering premium infotainment and driver-assistance features in future vehicles. Companies such as STMicroelectronics N.V., Infineon Technologies AG, NXP Semiconductors N.V. are some of the key innovators in Automotive Chip Market.

Market Growth Factors

The increasing demand for in-vehicle infotainment (IVI) systems is primarily driven by integrating advanced technologies in modern vehicles. Consumers expect more than just basic functionalities; they seek enhanced features such as navigation, connectivity, entertainment, and personalized user experiences. This shift has necessitated sophisticated semiconductor chips that enable various functionalities, such as high-resolution displays, audio processing, and connectivity options like Bluetooth, Wi-Fi, and 5G. Thus, rising demand for in-vehicle infotainment systems drives the market's growth.

Additionally, The growing concern for vehicle safety has led to a significant increase in the adoption of Advanced Driver Assistance Systems (ADAS). These systems' real-time data processing and decision-making capabilities, encompassing functions such as lane-keeping assistance and adaptive cruise control, largely depend on sophisticated semiconductor chips. As consumers prioritize safety, the demand for ADAS-equipped vehicles drives growth in this market. Therefore, the increasing adoption of advanced driver assistance systems (ADAS) is propelling the market's growth.

Market Restraining Factors

The production of these chips involves complex fabrication processes that require advanced technology and specialized equipment. These processes often entail high initial capital outlay for semiconductor fabrication facilities (fabs), which can cost billions of dollars to establish. The sophisticated manufacturing techniques needed to produce reliable chips for automotive applications further drive up production costs, limiting the number of companies that can enter the market. Hence, high manufacturing costs and capital investments impede the market's growth.

The leading players in the market are competing with diverse innovative offerings to remain competitive in the market. The above illustration shows the percentage of revenue shared by some of the leading companies in the market. The leading players of the market are adopting various strategies in order to cater demand coming from the different industries. The key developmental strategies in the market are Partnerships, Collaborations and Agreements.

Type Outlook

Based on type, this market is divided into analog ICs, microcontrollers & microprocessors, logic ICs, and others. In 2023, the analog ICs segment held 28% revenue share in this market. Analog ICs are crucial for a wide range of automotive applications due to their ability to process real-world signals such as temperature, speed, and pressure, which are essential for vehicle operation and safety. These chips convert these analog signals into digital data that can be processed by a vehicle's electronic systems.

Application Outlook

On the basis of application, this market is segmented into chassis, powertrain, safety, telematics & infotainment, and body electronics. In 2023, the safety systems segment attained 22% revenue share in this market. This area is critical for ensuring passenger and pedestrian safety through advanced driver-assistance systems (ADAS), airbag control systems, and anti-lock braking systems (ABS). The increasing emphasis on vehicle safety, driven by regulatory requirements and consumer expectations, has led to heightened investments in safety technologies, further boosting demand for these chips in this segment.

Vehicle Outlook

By vehicle, this market is divided into passenger vehicles and commercial vehicles. The commercial vehicles segment procured 40% revenue share in this market in 2023. This category includes trucks, buses, and other vehicles used for transporting goods and services. Increasing investments in fleet management technologies drive demand for chips that support commercial vehicles' telematics, navigation, and communication systems.

Regional Outlook

Region-wise, this market is analyzed across North America, Europe, Asia Pacific, and LAMEA. In 2023, the North America region witnessed 28% revenue share in this market in 2023. This can be attributed to several factors, including the presence of major automotive manufacturers and suppliers, strong demand for advanced vehicle technologies, and a growing emphasis on safety and connectivity features. The region’s innovation and research & development leadership has driven the adoption of cutting-edge automotive chips, particularly in advanced driver-assistance systems (ADAS) and infotainment solutions.

Market Competition and Attributes

The automotive chip market, excluding top key players, remains highly competitive with numerous smaller and regional companies vying for market share. These players focus on niche segments, offering specialized solutions in sensors, power management, and connectivity. Innovation, cost-efficiency, and partnerships with OEMs are crucial for gaining a competitive edge.

Recent Strategies Deployed in the Market

• Jun-2024: Texas Instruments teamed up with Delta Electronics, a global power management manufacturer, to develop next-generation electric vehicle (EV) power solutions. The partnership will leverage TI’s semiconductors, such as C2000™ microcontrollers, to enhance onboard charging and power density. This collaboration aims to improve EV efficiency, safety, and reliability, contributing to the broader adoption of electric vehicles in the market. Delta Electronics specializes in high-efficiency automotive power products.
• Jan-2024: Intel Corporation took over Silicon Mobility, an EV semiconductor solutions provider. The acquisition enhances Intel's automotive portfolio with energy-efficient SoCs.
• Jan-2024: NXP Semiconductors N.V. announced a partnership with Damon Motors, an urban mobility solutions provider, to integrate NXP's advanced automotive technology into Damon motor's electric motorcycles, enhancing safety, connectivity, and performance. This partnership leverages NXP's robust automotive ICs, embedded security solutions, and technical expertise, enabling Damon to accelerate development cycles and deliver secure, over-the-air updates for smarter, safer riding.
• Jan-2024: NXP Semiconductors extended its automotive radar one-chip family with the SAF86xx, integrating a radar transceiver, multi-core radar processor, and MACsec engine for secure data communication. The SoC supports next-gen ADAS and autonomous driving, enabling software-defined radar features and advanced detection capabilities, including 360-degree sensing and secure OTA updates.
• Jan-2024: Texas Instruments launched new automotive chips, including the AWR2544 radar sensor and DRV3946-Q1 driver, aimed at enhancing vehicle safety and autonomy. These innovations enable smarter decision-making in ADAS and more efficient powertrain systems. Texas Instruments partners with major automakers to bring these cutting-edge solutions to market.

List of Key Companies Profiled

• NXP Semiconductors N.V.
• Infineon Technologies AG
• Texas Instruments, Inc.
• STMicroelectronics N.V.
• Renesas Electronics Corporation
• ON Semiconductor Corporation
• Qualcomm Incorporated (Qualcomm Technologies, Inc.)
• Intel Corporation
• ROHM Co., Ltd.
• Microchip Technology Incorporated

Global Automotive Chip Market Report Segmentation

By Type

• Microcontrollers & Microprocessors
• Analog ICs
• Logic ICs
• Sensor
• Others

By Application

• Telematics & Infotainment
• Safety
• Powertrain
• Body Electronics
• Chassis

By Vehicle

• Passenger Vehicles
• Commercial Vehicles

By Geography

• North America
• US
• Canada
• Mexico
• Rest of North America
• Europe
• Germany
• UK
• France
• Russia
• Spain
• Italy
• Rest of Europe
• Asia Pacific
• China
• Japan
• India
• South Korea
• Singapore
• Malaysia
• Rest of Asia Pacific
• LAMEA
• Brazil
• Argentina
• UAE
• Saudi Arabia
• South Africa
• Nigeria
• Rest of LAMEA