The global automotive chip market is valued at approximately USD 50.74 billion in 2023 and is projected to grow at a remarkable CAGR of 10.66% during the forecast period 2024-2032.
The increasing adoption of connected vehicles is driving significant growth in the automotive chip market, as modern vehicles require advanced semiconductor solutions for connectivity, automation, and infotainment. With the global connected car market projected to reach USD 94.90 billion by 2029, demand for automotive microcontrollers, analog ICs, and telematics processors is rising rapidly.
These chips power ADAS (Advanced Driver Assistance Systems), AI-driven infotainment, and vehicle-to-everything (V2X) communication, enhancing safety and efficiency. Additionally, the shift towards electric and autonomous vehicles further accelerates demand for high-performance computing, battery management, and AI-driven vehicle systems, reinforcing the automotive chip market’s expansion.
The market’s growth is being driven by the rising demand for passenger and commercial vehicles worldwide. A significant shift towards lightweight and electric vehicles (EVs) is further accelerating the adoption of automotive adhesives and sealants, as manufacturers increasingly replace traditional welding and mechanical fastening techniques. By reducing vehicle weight and enhancing structural integrity, these advanced bonding solutions are playing a pivotal role in the next generation of automobile manufacturing.
The rapid evolution of automotive technology has accelerated substantial investments in chip innovation, as vehicles become more intelligent, autonomous, and connected. Automakers and semiconductor manufacturers are pouring resources into advanced microprocessors, AI-driven computing, and power-efficient chipsets to meet the growing demands of modern vehicles.
Leading tech companies such as NVIDIA, Qualcomm, Intel, and Texas Instruments are developing cutting-edge AI-based automotive chips, enhancing capabilities in sensor fusion, machine learning, and real-time decision-making. These chips are crucial for self-driving vehicles, enabling functions such as lane-keeping assistance, adaptive cruise control, and automatic emergency braking.
The rise of electric vehicles (EVs) has also driven innovation in power management and battery optimization chips. Semiconductor advancements are crucial in improving EV efficiency, extending battery life, and supporting fast-charging capabilities. Companies are investing in silicon carbide (SiC) and gallium nitride (GaN) semiconductors, which offer higher energy efficiency and better thermal management, making them ideal for EV powertrain applications.
Additionally, the demand for automotive infotainment and telematics systems is spurring advancements in high-speed connectivity chips, enabling 5G-enabled communication, seamless smartphone integration, and cloud-based navigation. Automakers are integrating over-the-air (OTA) update capabilities in their vehicles, requiring robust cybersecurity-focused semiconductor solutions to protect against data breaches and hacking threats.
Despite global semiconductor shortages and supply chain challenges, manufacturers are expanding fab capacity and investing in advanced chip architectures to meet the surging demand. Governments worldwide are also supporting semiconductor R&D through incentives and funding initiatives, further propelling the automotive chip industry’s growth.
As software-defined vehicles become the future standard, chip innovation remains at the heart of the transformation, enabling greater efficiency, safety, and connectivity in next-generation automobiles.
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Key findings of the study suggest:
- Asia Pacific region is anticipate to lead the market, with more than 44.2% market share in 2023.
- Microcontrollers and Processors segment dominates the market share with more than 45% revenue share in 2023.
- Among applications body electronics segment dominates with approx. 24% revenue share in 2023.
Bizwit Research & Consulting has considered following segments for the study:
By Product:
- Analog ICs
- Microcontrollers & Microprocessors
- Logic ICs
By Application:
- Body Electronics
- Telematics & Infotainment
- Powertrain
- Safety System
- Chassis
By Vehicle Type:
- Passenger Car
- Commercial Vehicle
By Propulsion:
- Internal Combustion Engine (ICE)
- Battery Electric Vehicles (BEVs)
- Hybrid Electric Vehicles (HEVs)
By Region:
- North America (U.S., Canada)
- Europe (UK, Germany, France, Italy, Spain, Rest of Europe)
- Asia Pacific (China, India, Japan, South Korea, Australia, Rest of Asia Pacific)
- Latin America (Brazil, Mexico, Rest of Latin America)
- Middle East & Africa (Saudi Arabia, UAE, South Africa, Rest of Middle East & Africa)
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