EV Semiconductor

EV Semiconductor

A semiconductor chip usually comprised of silicon, conducts electricity more than an insulator but less than a conductor. Their conductivity and other properties can be altered with the introduction of impurities, called doping, to meet the specific needs of the electronic component in which it resides. Semiconductor devices can show a range of useful properties, such as showing variable resistance, passing current more easily in one direction than the other, and reacting to light and heat. Their actual function comprised of amplification of signals, switching, and energy conversion. Semiconductors have now become the building block of a car and are becoming a source of value and innovation in the automotive industry.

The EV semiconductor market is expected to grow at a strong CAGR of around 30% during the forecast period owing to the surging demand for the electric vehicle. Furthermore, some of the major megatrends such as electrification, autonomy, connectivity, and mobility as a service, are reshaping the automobile industry and fiercely increasing the semiconductor content in the vehicles. Moreover, the semiconductor market is expected to witness significant growth over the forecast period owing to the increased government focus on curbing tailpipe emissions and increasing electric vehicle adoption by supporting the EV ecosystem with subsidies and tax incentives, in order to drive consumer demand. For instance, according to the international energy agency(IEA), Governments across the world spent USD 14 billion on direct purchase incentives and tax deductions for electric cars in 2020, a 25% rise year-on-year. Where automakers are steadily adding electronics to improve safety, improve comfort, and increase the battery range of electric vehicles.

• Based on types, the market is segmented into processors and microcontrollers, audio and radio, driver assistance transceivers, in-vehicle network, peripherals and logic, power management, and sensors and wireless. The power management segment holds the majority of the market share owing to the fact that they are the key to extending an EVs driving range, to making battery charge last as long as possible, and this is achieved by innovative semiconductor devices that deliver much greater efficiency and has the ability to turn on and off tens of thousands of times per second. Furthermore, the battery management system (BMS), is a large contributor to semiconductor demand in electric vehicles, assisting in monitoring the battery and providing protection to the most integral component of an electric vehicle and keeping it in high performing and healthy state, and industry-wide partnerships are taking place in this space. For instance, in March 2022, Tata Elxsi and Renesas Electronics Corporation (a Semiconductor Chip manufacturer), announced their collaboration on a design center in Bangalore that will develop targeted solutions for electric vehicles (EVs). In this partnership, both companies will bring together their domain expertise, intellectual property, and assets to the NEVIC and collaborate to create reference designs and solution accelerators for critical EV subsystems like Battery Management Systems and Motor Control Units, among others.
• Based on the application, the market is segmented into ADAS, vehicle electrification, body electronics and LED lighting, and powertrain, safety, and security. The powertrain, safety, and security, and body electronics segments are anticipated to witness a significant CAGR growth during the forecast period. The primary factors driving this growth are the increasing number of functionality and value based on software and electronics. Furthermore, powertrain electrification is taking place at a massive scale with rising electric vehicles demand, and as vehicle powertrains move from ICE to electric, semiconductors per car will get doubled in value, due to the increasing use of discrete semiconductors, compound semiconductors, and sensors. Moreover, with the rising autonomy, where autonomous vehicles will require a whole new level of connectivity. These vehicles are expected to have eight to ten times the semiconductor content by value, than a car with no automation and will be more of a supercomputer on wheels than a car.
• Based on vehicle type, the market is segmented into BEV, PHEV, and HEV. BEV is anticipated to witness a significant CAGR during the forecast period. The driving factor for BEV is urbanization where more than 50% of the global population is projected to be living in the cities by the year 2030, where driving distances are much shorter hence making BEV an ideal choice. Moreover, businesses and governments worldwide are aiming at reducing GHG(greenhouse gas) emissions, reducing noise pollution, and increasing efficiency by focusing more on making EVs mainstream where governments are offering tax credits and incentives for those who purchase EVs, making electric vehicles more accessible for the mass adoption, further boosting the demand of the electric vehicles which is also getting reflected in the sales data. For instance, according to the international energy agency(IEA), Consumers spent USD 120 billion on electric car purchases in 2020, a 50% increase from 2019, which breaks down to a 41% increase in sales and a 6% rise in average prices.
• For a better understanding of the market adoption of the EV semiconductor, the market is analyzed based on its worldwide presence in the countries such as North America (U.S., Canada, and the Rest of North America), Europe (Germany, U.K., France, Spain, Italy, Rest of Europe), Asia-Pacific (China, India, Japan, South Korea, Australia, Rest of Asia-Pacific), Rest of World. The Electric Vehicle semiconductor market in the Asia Pacific region is anticipated to witness significant growth throughout the forecast period. Owing to the rising per capita GDP of the countries in the Asia Pacific hence improving the standard of living and increasing money in the hands of people driving the consumption of the countries. Though as a percentage of total vehicles sold electric vehicle percentage is highest in Europe but the number of units sold in China is leading the pack and has emerged as a top producer and seller of electric vehicles in the world. The Asian countries are projected to produce almost 13 million electric vehicles in the year 2023, whereas, in 2022, china has sold roughly 52% of the total EVs produced in the world which amounts to almost 3.5 million units, India the number is currently at one-third of a million unit but was almost 168% growth from the previous year. Hence, looking at the size of the market that these emerging economies have, the size of the population with rising income and awareness and the availability of the OEMs that are offering great value buys to the customers in terms of price and product and further support from the governments is showing a future of high growth prospects for the electric vehicles market in the APAC region. For instance, China (from a previous 2020 expiration date) extended its NEV subsidy program through the end of 2022, albeit it has started to reduce basic subsidy amounts by 10%, 20%, and 30% per year. (between 2020 and 2022). Through the end of 2023, it also extended the exemption from purchase taxes for NEVs.
• Some of the major players operating in the market include STMicroelectronics; NXP Semiconductor; Semiconductor Components Industries, LLC; Infineon Technologies AG; Texas Instruments Incorporated; Renesas Electronics Corporation.; Broadcom; WOLFSPEED, INC; Microchip Technology Inc.; and Taiwan Semiconductor Manufacturing Company Limited.