Automotive Semiconductor Market Size, Share, and Trends 2025 to 2034

Automotive Semiconductor Market Size and Forecast 2025 to 2034

The global automotive semiconductor market size was estimated at USD 46.79 billion in 2024 and is anticipated to reach around USD 102.15 billion by 2034, expanding at a CAGR of 8.12% from 2025 to 2034. 

Automotive Semiconductor Market Key Takeaways

• Asia Pacific dominated the global market with the largest market share of 45% in 2024.
• Europe is projected to expand at the fastest CAGR of 7.24% during the forecast period.
• By component, the discrete power segment contributed the highest market share of 28% in 2024.
• By vehicle type, the passenger vehicles segment captured the biggest market share of 67% in 2024.
• By vehicle type, The light commercial vehicle segment is predicted to grow with CAGR of 6.54% during the forecast period
• By application, the body electronics segment has held the largest market share of 23% in 2024.
• By application, The telematics and infotainment segment is expected to witness the solid CAGR during the forecast period.

How is AI changing the automotive semiconductor market?

AI-powered semiconductors are transforming the automotive industry, particularly in autonomous and EVs addressing and driving various major challenges. While autonomous driving promises a more relaxed and safer roads driving experience for customers, it also needs regulatory compliance and reliable AI technologies, for which AI-generated semiconductors act as major driving factors in the automotive semiconductor market. AI-generated chips enable vehicles to communicate with road sensors and traffic lights, improving traffic flow, reducing congestion and enhancing road safety. 

Asia Pacific Automotive Semiconductor Market Size and Growth 2025 to 2034

The Asia Pacific automotive semiconductor market size was evaluated at USD 21.06 billion in 2024 and is predicted to be worth around USD 46.48 billion by 2034, rising at a CAGR of 8.24% from 2025 to 2034. 

Asia Pacific has accounted revenue share of 45%. The automobile manufacturers are constantly focused on creating, innovating, and developing autonomous vehicles, which have attracted a sizable percentage of buyers in key automotive manufacturing countries.

North America, on the other hand, is expected to develop at the fastest rate during the forecast period. Due to the expansion of the automotive sector, particularly in emerging economies, the region is expected to be the fastest growing market over the projected period. Furthermore, the booming e-commerce business is expected to boost demand for commercial vehicles in the future years.

Market Overview

The automotive semiconductor market deals with automobiles made of germanium and silicon, which are the basic components needed for the accurate operation of automotive electronics. Semiconductors installed in vehicles guide in controlling various operations such as ensuring the vehicle's safety and controlling the vehicle's air conditioner system. In addition, the rapid expansion of the automotive industry and increasing road facilities creating the need for advanced safety features are expected to drive the market growth.  

The increasing focus on safety systems in vehicles, increasing adoption of electronic control units in modern vehicles, increasing penetration of electronic components in luxury to mass-produced cars, and increasing proliferation of fuel efficiency standards, automotive safety systems, infotainment systems, and connected cars are further anticipated to drive the growth of the automotive semiconductor market during the forecast period. 

Automotive Semiconductor Market Growth Factors

• The rising advancements in vehicle-based technology, such as the introduction of advanced driver assistant system, infotainment, and telematics, as well as a greater willingness to adopt electric vehicles, all contribute to the global growth of the automotive semiconductor industry.
• The automobile industry has boosted significantly in the last few years, with the introduction of numerous technologies in the industry, such as 3-dimensional mapping applications, the arrival of electric vehicles, automobile automation, and many others.
• The rapid advancements in the automotive sector, rising demand for safety features in automobiles, and the implementation of innovative technologies for advanced user interface fuel the automotive semiconductor market’s global expansion.  
• Factors such as rising demand for electric and hybrid vehicles, as well as increased technological improvement and innovation in advanced driver assistance systems, would provide sufficient potential for the automotive semiconductor market expansion throughout the forecast period.
• The expanding trend of vehicle electrification and the growing need for sophisticated convenience, safety, and comfort systems, rising vehicle production, the rising trend of vehicle electrification, and rising demand for advanced comfort, safety, and convenience systems are expected to propel the global automotive semiconductor market.

Automotive Semiconductor Market Scope

Market Dynamics

Driver

Increasing road facilities is creating a need for advanced safety features 

Due to the increasing number of road accidents, there is increasing demand for safety technologies such as telematics, airbags, tyre pressure monitors, electronic stability control, traction control lane departure warnings, collision avoidance, and parking assistance. Automotive semiconductors are a vital component in various advanced driver assistance systems technologies, which aid systems function efficiently by classifying and detecting objects in the path of vehicles and alerting the driver about road accidents and the vehicle’s surroundings, these systems can also automatically stop or slow down the car based on road conditions are expected to drive the growth of the automotive semiconductor market.  

Restraint

High cost and security risk of vehicles 

A failing component can diversely impact the performance of vehicles. Components such as SoCs and microprocessors are interconnected, and most complex controls impact each other. Therefore, even if one component is tampered with or fails it can cause vehicles to operate. The MCU controlled cars do not have secondary backups. Hence, a faulty MCU can create a significant safety concern in vital applications. In addition, high vehicle costs, tailored with continuous component size improvement are expected to restrain the growth of the automotive semiconductor market.  

Opportunity 

The rising demand for hybrid and electric vehicles 

The rising adoption of hybrid and electric vehicles is becoming increasingly popular across the globe. The decreasing cost of components such as microcontrollers, sensors, and lithium-ion batteries are major factors expected to contribute to the development of a mainstream market for electric vehicles in the coming years. In addition, due to their important role in addressing air pollution and reducing carbon emissions, governments are strongly encouraging electric vehicles across the globe that are expected to enhance the growth of the automotive semiconductor market.

Component Insights

The discrete power segment dominated the automotive semiconductor market in 2024 with revenue share of 28%. The automotive sector has a high need for semiconductors across all component types. These components aid in the networking, electrification, and sharing of mobility services of vehicles. 

The memory segment is fastest growing segment of the automotive semiconductor market in 2022. This is attributed to the continuing electrification of major automotive applications such as the powertrain, which is driving up demand for power components.

Vehicle Type Insights

The passenger vehicles segment has accounted 67% revenue share in 2024. The strong demand for passenger automobiles around the world is responsible for the growth of the segment.

The light commercial vehicle segment is fastest growing segment of the automotive semiconductor market in 2022. The growth of light commercial vehicles is likely to be fueled by rapid urbanization, improvements in road infrastructure, regulatory frameworks for purchasing commercial vehicles, and the expansion of e-commerce channels.

Application Insights

The body electronics segment has generated 24% revenue share in 2024.

More demand for semiconductor components in safety applications is being driven by stringent regulations and standards.

The telematics & infotainment segment, on the other hand, is predicted to develop at the quickest rate in the future years. The automobile manufacturers are increasingly using semiconductor components for telematics and infotainment applications as a result of increasing competition among vehicle manufacturers to deliver improved convenience and comfort to their customers.

Automotive Semiconductor Market Companies

• Robert Bosch GmbH
• NXP Semiconductors N.V.
• Texas Instruments Inc.
• Analog Devices Inc.
• ON Semiconductor Corporation
• Renesas Electronics Corporation
• Infineon Technologies AG
• STMicroelectronics N.V.
• ROHM Co. Ltd
• Toshiba Corporation

Latest Announcements by Market Leaders

• In February 2024, N Chandrasekaran, tata sons chairman said that the conglomerate is set to announce a semiconductor chip fab with a substantial investment "very soon". 
• In September 2024, Honda, Ford and BMW appointed the first CEO and CTO and begun operations of the new joint venture. ChargeScape is a software platform that integrates electric vehicles (EVs) into the power grid, shoring up grid stability while saving drivers money on their charging.

Recent Developments

• In August 2024, Foxconn and Stellantis unveiled their joint venture, SiliconAuto, which is focused on producing and designing semiconductors specifically tailored for the automotive industry. This collaboration, set to commence operations in 2026, brings together Foxconn, a major electronics assembler and Stellantis, a leading automotive manufacturer. 
• In January 2024, a new automotive semiconductor was introduced by Texas Instruments. This semiconductor was designed to improve automotive safety and intelligence. The AWR2544 77GHz mm-wave radar sensor chip enables higher levels of autonomy by improving sensor fusion and decision-making in ADAS. 
• In September 2024, SiliconAuto, a Foxconn-backed automotive technology company announced the launch of its research and development centre in Bengaluru. This new centre focuses on semiconductor product design and system-on-chip development for the automotive industry.  
• In December 2023, a premier supplier of advanced semiconductor solutions, Renesas Electronics Corporation launched a new cloud-based development environment. The aim behind this launch was to streamline the software design procedure for automotive AI engineers.  

Segments Covered in the Report

By Component

• Processor
• Discrete Power
• Sensor
• Memory
• Others

By Vehicle Type

• Passenger Vehicle
• Light Commercial Vehicle
• Heavy Commercial Vehicle

By Fuel Type

• Gasoline
• Diesel
• Electric/Hybrid Electric Vehicle (EV/HEV)

By Application

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

By Geography

• North America
  • U.S.
  • Canada
• Europe
  • U.K.
  • Germany
  • France
• Asia-Pacific
  • China
  • India
  • Japan
  • South Korea
  • Malaysia
  • Philippines
• Latin America
  • Brazil
  • Rest of Latin America
• Middle East & Africa (MEA)
  • GCC
  • North Africa
  • South Africa
  • Rest of the Middle East & Africa