Automotive Integrated Circuit Market Size, Share, Growth, and Industry Analysis, By Type (Monolithic Integrated circuits and Hybrid Integrated circuits), By Application (Advance Driver Assistance System, In-vehicle Networking, Engine Management, Transmission Control System, and Others), and Regional Forecast to 2032

Last Updated: 09 January 2025

AUTOMOTIVE INTEGRATED CIRCUIT MARKET OVERVIEW

The global automotive integrated circuit market size was USD 48.865 billion in 2024 and is projected to touch USD 97.128 billion by 2032, exhibiting a CAGR of 7.93% during the forecast period.

An automotive integrated circuit (IC) is an electronic component fabricated to function in harsh situations. It is encountered in a vehicle such as high temperatures, vibration, and electromagnetic interference. It helps in improving the overall performance of a car by offering more precise control of engine management and broadcast control. This component enabled vehicle manufacturers to assemble multiple applications on a single chip to optimize performance as semiconductor technology has evolved.

The growth of the market is driven by rapid electrification of vehicles. In addition, increases in usage of this technology in automobiles are anticipated to offer lucrative demand for electronics in vehicles. The integration of advanced technologies with the ICs augments the market growth and offers an avenue for companies to expand their market reach. This increase in demand lowers down the process of ICs, which further boosts the market growth.

GLOBAL CRISES IMPACTING AUTOMOTIVE INTEGRATED CIRCUIT MARKETCOVID-19 IMPACT or RUSSIA-UKRAINE WAR IMPACT or ISRAEL-HAMAS WAR IMPACTCOVID-19 IMPACT

Automotive Integrated Circuit Industry Had a Negative Effect Due to Halt on Production during COVID-19 Pandemic

The global COVID-19 pandemic has been unprecedented and staggering, with the market experiencing higher-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden market growth reflected by the rise in CAGR is attributable to the market’s growth and demand returning to pre-pandemic levels.

The COVID-19 pandemic has negatively influenced the market growth. The automobile sector has experienced a sweeping downturn in the pandemic. This led to a stoppage on manufacturing units. Thus, the demand for ICs came down rapidly. The maintenance of solid vehicles also decreased as vehicle usage touched almost zero for many people due to the global lockdown. The pandemic disrupted the supply chain, resulting in a lack of raw material inventory for producers, and delivery of finished products to consumers was difficult. However after-pandemic period, the development of new technologies in the automotive industry, for instance self-driving cars, increased the demand for ICs. Thus, the pandemic limited the market growth, but after the pandemic period, the market gained its share back with an improved technological base.

LATEST TREND

"Incorporation of AI and Machine Learning to Impel Market Growth"

There is an increasing integration of AI and machine learning in automotive ICs. This makes cars smarter, improving autonomous driving and personalizing user experiences. The rising focus on energy efficiency is crucial. This is to meet environmental standards and reduce carbon footprints. Manufacturers aim to make ICs that lower power use, especially in electric and hybrid cars. In addition, smart transportation systems will require ICs for cars to communicate. This improves traffic management, safety, and efficiency. Therefore, the market is growing supported by technology, regulations, and changes in the automotive sector.

AUTOMOTIVE INTEGRATED CIRCUIT MARKET SEGMENTATION

BY TYPE

Based on Type, the global market can be categorized into monolithic integrated circuits and hybrid integrated circuits

• Monolithic Integrated circuits:  This is a complete group of ICs that are crafted on a single piece of silicon and they are smaller, lighter, and more efficient than older technologies, and offer better reliability and lower power consumption.
• Hybrid Integrated circuits: It is miniaturized electronic ICs that combine different electronic components onto a single platform and they are made up of individual devices, for instance semiconductors devices and passive devices that are bonded to a substrate and printed circuit board.

BY APPLICATION

Based on application, the global market can be categorized into advance driver assistance system, in-vehicle networking, engine management, transmission control system, and others

• Advance Driver Assistance System: This application segment is leading the market because safety features are gaining more and more importance these days, the implementation of ADAS is increasing.
• In-vehicle Networking: It connects all the electronic systems in the vehicle. The infotainment system and the vehicles’ electronics are connected by the networking.
• Engine Management: This segment controls emissions, fuel efficiency, and the engine’s performance.
• Transmission Control System: It is the slowest growing segment of the market as the device is helping to improve the overall performance of a vehicle.
• Others: There are other application areas present in the market where the device is used such as safety systems, power management, communication systems, and others.

MARKET DYNAMICS

Market dynamics include driving and restraining factors, opportunities and challenges stating the market conditions.  

DRIVING FACTORS

"Rise of Electric Vehicles (EVs) to Enhance the Market"

The growing attribute for the automotive integrated circuit market growth is the augment of electric vehicles (EVs). As governments and consumers focus on sustainability, EV demand is skyrocketing. This, in turn, increases the necessity for advanced ICs. These chips handle EV functions for instance battery systems, power, and drive control. The change to EVs requires ICs that handle higher voltages and unstable conditions. Furthermore, semiconductor improvements are building ICs smaller and more efficient. This is a key aspect to better EV performance. Manufacturers are backing research because the EV market produces. They desire to develop ICs that advance performance, safety, and the user experience. This factor is probable to enhance the market growth side with the broader move to electrify cars.

"Regulatory Standards and Safety Compliance to Expand the Market"

Authoritarian standards and protection compliance are essential in forming the market growth. Strict guidelines are now obligatory with a growing focus on vehicle security and sustainability. Producers must integrate higher safety and emissions control technologies. This requirement boosts the demand for specialized ICs. Corporations have to make ICs that convene current standards and look forward to future changes. This situation sparks innovation companies spend in ICs that progress safety, reliability, and efficiency. The augments in cybersecurity apprehension is propelling the expansion of secure IC architectures. These architectures protect against threats as regulations change, the market will adapt to congregate the highest standards.

RESTRAINING FACTOR

"Complex Design and Price of ICs to Potentially Impede Market Growth"

The integrated circuits have a very complex design formation. It consists of microprocessors of diverse shapes and sizes. The dependability of the material used in production of the wire and transistors also has immense importance in the proper working of the IC.  Thus, the working of the vehicles, new IC design has to work out according to the show expected from the vehicles. If the IC fails to bring the necessary output in tremendous conditions, it will adversely affect the market escalation of the vehicle. Therefore the intricacy of designing the IC and the compatibility of the IC are major off-putting issues for the market expansion.

OPPORTUNITY

"Adoption of 5G Technology and Miniaturization and Integration to Create Opportunity for the Market"

The incorporation of 5G communication technologies into vehicles is heightening the demand for advanced automotive ICs. It enables ultra-fast data transfer, critical for autonomous driving and vehicle to everything (V2X) communication systems. They are used for high-speed data transmission and low latency communication making them suitable ICs for connected vehicle application as well as improving road safety. Additionally, as automotive electronics become more complex, there is a growing trend towards the ministries and integration of ICs. More powerful ICs allow for more efficient use of space and better performance, indispensable for the compact designs of modern vehicles. With the cyber threat rising, the ICs with stronger security features are increasingly becoming a necessity to guarantee the safety and authenticity of systems in vehicles that have the data and communication channel protected with such hardware-based security features implemented in these ICs.

CHALLENGE

"Intense Competition among IC Manufacturers Could Be a Potential Challenge for Market"

The market faces certain pressure that is the intense competition among IC manufacturers. The market is extremely competitive, with several competitors who are vying for market share. It can lead to price wars and margin pressures, hence hindering the market. Additionally, the rapid pace of technological advancements in the automotive industry requires continuous innovation and huge expenditure on research and development activities. IC manufacturers must keep on in advance of the curve to convene the evolving demands of automakers and consumers, posing a significant challenge in terms of resources allocation and planned arrangement.

AUTOMOTIVE INTEGRATED CIRCUIT MARKET REGIONAL INSIGHTS

• NORTH AMERICA

North America is gaining traction over the market share. The high demand for luxury vehicles equipped with advanced safety features is fueling the market growth. A growing number of research activities with the growing prominence for innovative technology are escalating the market growth rate in the region. The United States automotive integrated circuit market is growing because of the existence of major automobile manufacturers. The adoption of technology companies in the region further fueling market growth. Furthermore, the increasing emphasis on EVs and sustainable transportation solutions is increasing demand for the product in the region.

• EUROPE

Europe is deemed to hit the highest growth rate because of the presence of major car companies and the intensifying demand to launch luxury cars and is promoting the shares of the market. The growing acceptance of ADAS and autonomous vehicle technologies in Europe is helping companies to expand their market presence in the region. The region’s strict emission set of laws and commitment to reduce the carbon footprints have led to significant financial support in electric and hybrid vehicle technologies. In addition, the rising economy and increasing disposable income in urban areas are leveling up the market growth in this region.

• ASIA

Asia Pacific region is ruling the automotive integrated circuit market share. The region’s dominance is attributed to its large machines manufacturing base and rapid implementation of advanced technologies in vehicles. ICs always have huge demand in this region as a result of the increasing demand for advanced vehicles. Countries such as India, China, and Japan are among the prime automobile areas in the region which is contributing in the market growth significantly. The region is likely to maintain its control on position in the market with ongoing investments in automobile technology and infrastructure development.

KEY INDUSTRY PLAYERS

"Key Industry Players Shaping the Market through Expenditure on R&D and Market Strategies"

The participants are focusing on developing innovative IC technologies that meet the evolving needs of the automobile industry. They are paying attention to developing innovative products and technologies to meet the evolving needs of the market. Major players are funding huge amounts on the research and development activities to strengthen their market competition grip and expand further. The development is being driven by the increasing demand for electronic components in vehicles. The market is also seeing strategic collaborations and partnerships between leading IC producers and car companies to speed up the development and deployment of advanced solutions.

LIST OF TOP AUTOMOTIVE INTEGRATED CIRCUIT COMPANIES

• Mikroelektronik Ltd. (Turkey)
• Qualcomm Technologies (U.S.)
• STMicroelectronics N.V. (Switzerland)
• Atmel (U.S.)
• Intel (U.S.)
• ROHM CO. LTD. (Japan)
• Renesas Electronics Corporation (Japan)
• ON Semiconductor (U.S.)
• Microchip Technology (U.S.)
• Samsung (Korea)
• Robert Bosch Limited (India)
• Rohm Co. Ltd (Japan)
• Texas Instruments (U.S.)
• NXP Semiconductors N.V (Netherlands)
• Toshiba Electronics. (Japan)
• Infineon Technologies AG (Germany)

KEY INDUSTRY DEVELOPMENT

January 2024: Intel announced the agreement for acquisition of Silicon Mobility SAS for advanced EV energy management and unveiled the plans to handle the company’s ‘AI everywhere’ software-defined vehicles that will enable in-vehicle AI such as GenAI and camera-based passenger and driver monitoring.

REPORT COVERAGE

The study encompasses a comprehensive SWOT analysis and provides insights into future developments within the market. It examines various factors that contribute to the growth of the market, exploring a wide range of market categories and potential applications that may impact its trajectory in the coming years. The analysis takes into account both current trends and historical turning points, providing a holistic understanding of the market's components and identifying potential areas for growth.

The automotive integrated circuit market is poised for a continued boom pushed by rising electric vehicles (EVs), regulatory standards and safety compliance, and rise in cybersecurity concerns. Despite challenges, the integrated circuits have a very complex design structure and intense competition among IC manufacturers. Key participants of the market are investing a lot in research and development to attain a competitive edge and to develop novel IC technologies that fulfill the evolving requirements of the automotive industry. The market opportunity is integration of 5G communication technologies into vehicles and as automotive electronics become more complex, there is a growing trend towards the ministries and integration of ICs.