As the automotive industry pursues more and more electronics, intelligence and networking, automotive electronic chips have become one of the key driving forces for the development of the automotive industry. This article will deeply explore the current status of the automotive electronic chip market in 2023 and look forward to its future development trends.
Current status of the automotive electronic chip market
1. Market demand increases significantly
As the degree of electronics in the automotive industry increases, the demand for automotive electronic chips is also growing rapidly. From basic power system control, to advanced driver assistance systems (ADAS), driverless technology, and car entertainment systems, they all rely heavily on electronic chips. It is predicted that by 2023, the global automotive electronic chip market will reach tens of billions of dollars.
2. Prominent supply chain problems
However, supply chain problems have gradually emerged. Since 2023, the global chip supply shortage has been plaguing the automotive industry. The imbalance between supply and demand caused by production capacity shortages, lagging production processes and other issues has forced many automobile manufacturers to suspend production lines. Although relevant departments are increasing investment and seeking solutions, solving this problem in the short term remains a challenge.
1. Highly integrated and low power consumption
As automotive electronic systems become more and more complex, automotive electronic chips will tend to be highly integrated and low-power. On the one hand, this will greatly reduce the cost and volume of automotive electronic systems and improve the overall performance of the vehicle. On the other hand, this also puts forward higher requirements for chip process technology, which will have a profound impact on the development of the semiconductor industry.
2. Intelligent and networked
Intelligence and networking will be another development trend of automotive electronic chips. Driven by 5G and AI technology, automotive electronic chips will have more powerful data processing capabilities and more complex algorithms, providing stronger support for autonomous driving and Internet of Vehicles.
3. Market competition intensifies
In the future, with the development of automotive electronic chip technology and the growth of market demand, market competition will further intensify. On the one hand, traditional automotive electronics chip manufacturers need to maintain competitive advantages through technological innovation and production capacity improvement; on the other hand, new market participants, such as technology giants and start-ups, are also constantly pouring into this market, hoping to use their own technological advantages and innovation capabilities to gain market share.
4. Strengthening of independent research and development capabilities
Today, the core competitiveness of the automotive industry is gradually shifting to automotive electronics, especially the independent research and development capabilities of automotive electronic chips. With the development of autonomous driving, electrification, and connectivity, automobile manufacturers’ demand for chips has become increasingly personalized and high-end, which has also forced them to improve their research and development capabilities. A large number of automobile manufacturers have begun to form their own chip teams or have in-depth cooperation with chip manufacturers to ensure their control over key technologies.
5. Enhanced security requirements
As automobiles become more intelligent and electronic, the safety of automobile electronic chips has attracted more and more attention. Whether it is data protection or system stability, security is an important factor that must be considered. Therefore, how to improve chip performance while ensuring its safety will be an important issue in the future development of automotive electronic chips.
In 2023, the automotive electronic chip market will show strong development momentum. Whether it is the surge in demand or the rapid advancement of technology, it indicates the huge potential of this market. However, it also faces challenges such as supply chain issues and market competition. For automobile manufacturers and chip manufacturers, how to grasp the changes in this market and improve their own technology and production capacity to cope with future development trends will be a problem they must face.
Looking back on the past, the development history of automotive electronic chips is a history of technological innovation and market change. Looking to the future, its development will continue to be written in technological advancement and market competition. Whether it is developing towards high integration and low power consumption, or meeting the challenges of intelligence and networking, automobile manufacturers and chip manufacturers need to work together and move forward hand in hand. Only in this way will the future of the automotive electronic chip market be as we wish, full of vitality and hope.
In order to facilitate industry professionals or investors to further understand the current situation and prospects of the automotive chip industry, Zhiyan Consulting has launched the “2023-2029 China Automotive Chip Industry Market Panoramic Assessment and Investment Prospects Planning Report” (hereinafter referred to as the “Report”). The report provides a comprehensive review and in-depth analysis of China’s automotive chip market. It is the result of many years of continuous tracking, on-site visits, research and analysis by Zhiyan Consulting.
In order to ensure the accuracy of the data in the automotive chip industry and the reference value of the content, the Zhiyan consulting research team carried out data collection through multiple channels such as listed company annual reports, manufacturer surveys, dealer discussions, expert verification, etc., and conducted multi-dimensional analysis of the data. In order to deeply analyze various fields of the industry, practitioners can comprehensively understand the development trend of the automotive chip industry in 2022 from multiple dimensions and aspects, as well as the cutting-edge hot spots of innovation, thereby empowering automotive chip practitioners to get a head start on the transformation track.
Automotive chips are tiny electronic components embedded in cars that process and control various vehicle functions. According to functions and applications, automotive chips can be divided into multiple categories, including control unit chips (ECU), sensor chips, communication chips and processor chips. The control unit chip manages systems such as engine, brakes and air conditioning. Sensor chips acquire vehicle and environmental data, such as cameras, radar and lidar. Communication chips support communication inside and outside the vehicle, such as vehicle networking and vehicle-to-infrastructure communication. Processor chips are used to run complex driver assistance and autonomous driving systems.
From the perspective of the global automotive chip industry market size, data shows that the global automotive chip industry market size will be approximately US$48.04 billion in 2022, a year-on-year increase of 5.4%, with a compound growth rate of 6.89% from 2014 to 2022. Global automotive chips will benefit from automotive electric power Driven by the trend of automation and intelligence, the market size is growing rapidly. In terms of regional distribution, automotive chips are concentrated in developed countries and regions. European automotive chip market size accounts for approximately 25.1%; China accounts for 22.7%; the United States accounts for 20.5%; and Japan accounts for 10.4%.
In terms of the market size of the domestic automotive chip industry, the automotive chip market has a large market space in our country. Currently, high-end products mostly rely on imports. According to statistics, the market size of China’s automotive chip industry in 2022 will be approximately 79.46 billion yuan, a year-on-year increase of 7.5%. Among them, computing and control chips accounted for 26.2%, power semiconductors accounted for 23.5%, sensor chips accounted for 12.4%, and other automotive chips accounted for 37.9%.
From the perspective of global market competition, the overall automotive chip market concentration is low. Currently, the top five manufacturers in the global automotive chip market account for nearly 50%, and the market share is basically concentrated among foreign chip manufacturers. Among them, Infineon accounts for the largest share. After Infineon acquired Cypress, it occupied the first place with a market share of 13.2%. Followed by NXP, Renesas, TI and STMicroelectronics, accounting for 10.9%, 8.5%, 8.3% and 7.5% respectively.
In terms of the domestic market, the localization rate of my country’s automotive chips is very low. Data shows that the localization rate of automotive chips in 2022 will be only 5.4%. However, there are many companies related to the automotive chip industry in my country. From the perspective of the entire chip industry chain, many domestic automotive chip manufacturers are increasing research and development innovation and accelerating the development of the domestic automotive chip industry. At present, in the field of MCU chips, foreign companies occupy a large market share, and the research of domestic companies still needs to be advanced and deepened. Some companies with strong R&D capabilities in the industry have formed large technological advantages in segmented fields and occupy a dominant position in market competition. The localization process of the automotive chip industry is expected to accelerate in the future.
The value of semiconductors in traditional fuel vehicles is mainly concentrated in areas such as body control and chassis safety. New energy vehicles are facing electrification and intelligent upgrades, and there is an incremental demand for chips in areas such as electric drive, electric control, autonomous driving, smart cockpits, data storage, and communications. On the one hand, the increase in penetration rate has driven the steady growth of new energy vehicle sales. On the other hand, electrification and intelligent upgrades have led to a steady increase in the value of automobiles and bicycles. According to data, from 2020 to 2025, the value of automobile and bicycle chips will increase from US$489 to US$716, with a CAGR of more than 8%. The superposition of two major factors promotes automotive chips to maintain a rapid growth rate. In the future, the automotive chip industry will continue to develop in three directions: autonomous driving technology, vehicle interconnection and data security, as well as energy efficiency and environmental protection.
- The accelerated evolution of autonomous driving technology. With the continuous development of autonomous driving technology, automotive chips will be more focused on processing massive sensory data, real-time decision-making and high-precision positioning. The new generation of chips will integrate multiple sensor data, such as cameras, lidar and radar, to achieve safer and more accurate autonomous driving functions through artificial intelligence and deep learning. At the same time, distributed computing will become a trend, allowing vehicles to process and respond to complex driving scenarios more quickly.
- Vehicle interconnection and data security. The rise of vehicle interconnection and intelligent transportation systems will promote further innovation in communication and data processing of automotive chips. The chips will enable vehicles to communicate in real time with infrastructure, other vehicles and cloud platforms to provide real-time traffic information, remote control and software updates. However, data security will become an important issue, and future chips will need to integrate stronger encryption and authentication technologies to ensure the security of vehicle data and communications.
- Energy efficiency and environmental protection. The new generation of automotive chips will focus on energy efficiency to reduce energy consumption and emissions. This includes optimized battery management, intelligent control of electric vehicle powertrains, and efficient use of renewable energy. At the same time, chips will play a greater role in vehicle environmental perception and traffic optimization, helping to achieve a smarter and more efficient urban transportation system.