Market Trends of Europe Automotive Semiconductor Industry
The Passenger Vehicles Segment is Expected to Drive the Market's Growth
- Automotive semiconductors find applications in various safety systems within passenger vehicles. These semiconductors are used in power electronics modules that control the anti-lock braking system (ABS), electronic stability control (ESC), and advanced driver-assistance systems (ADAS). By accurately monitoring and adjusting power flow, these systems enhance vehicle stability, traction, and overall safety.
- Moreover, automotive semiconductors play a crucial role in power management within passenger vehicles. These semiconductors are used in DC-DC converters, voltage regulators, and other power control modules, ensuring efficient power distribution and optimal utilization of electrical energy.
- These tiny electronic components are integrated into different systems within the vehicle, enabling advanced safety features and ensuring a safer driving experience. One of the primary applications of automotive semiconductors in passenger vehicle safety is the anti-lock braking system (ABS). ABS relies on sensors and microcontrollers to monitor wheel speed and prevent wheel lock-up during sudden braking. By rapidly modulating brake pressure, automotive semiconductors help maintain vehicle stability, prevent skidding, and reduce the risk of accidents.
- They are also employed in electronic stability control (ESC) systems. ESC uses sensors, accelerometers, and microcontrollers to monitor vehicle dynamics and apply selective braking to individual wheels. Automotive semiconductors enable real-time data processing and precise control, enhancing vehicle stability and preventing loss of control in hazardous situations.
- The increasing automotive production in Europe is likely to increase the demand for automotive semiconductors. For instance, according to OICA, around 1.5 million motor vehicles were produced in France in 2023, 68.2% of which were passenger cars. In 2022, approximately 1.3 million cars were produced in France.
- Furthermore, the proliferation of connected car technologies has transformed the way users interact with vehicles. From infotainment systems to advanced driver assistance systems (ADAS), connected car technologies rely on semiconductor chips to enable seamless communication and data processing. With the increasing integration of internet connectivity, cloud services, and data analytics in vehicles, the demand for automotive semiconductors is expected to grow exponentially.
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Germany is Expected to Witness High Market Growth Rate
- Germany, known for its strong automotive industry, has established itself as one of the leading players in the global automotive semiconductor market. With a robust ecosystem of automotive manufacturers, suppliers, and technology companies, Germany has become a hub for semiconductor development and production. Semiconductor companies like Infineon Technologies, Bosch, and Continental AG have a significant presence in Germany. These companies specialize in producing a diverse range of automotive semiconductors, including microcontrollers, sensors, power management ICs, and connectivity solutions.
- German semiconductor companies often collaborate with automotive manufacturers, research institutions, and start-ups to foster innovation, drive technological advancements, and enhance their market capitalization.
- For instance, in January 2024, Infineon Technologies AG and GlobalFoundries announced a new multi-year agreement on the supply of Infineon’s AURIX TC3x 40 nanometer automotive microcontrollers and power management and connectivity solutions. The additional capacity is anticipated to contribute to secure Infineon’s business growth from 2024 through 2030. At the center of this collaboration is claimed to be a highly reliable embedded non-volatile memory technology solution that is designed to enable mission-critical automotive applications while satisfying the stringent safety and security requirements for next-generation vehicle systems.
- The increasing automobile production in Europe is likely to augment the demand for the market studied. For instance, according to the International Organization of Motor Vehicle Manufacturers (OICA), in 2023, Germany was the largest automobile manufacturing country in Europe, with approximately 4.1 million vehicles produced.
- The increasing demand for electric vehicles (EVs) and autonomous driving systems has driven the development of specialized semiconductors to meet the unique requirements of these applications. For instance, according to the Kraftfahrt-Bundesamt (Federal Motor Transport Authority - KBA), the number of new electric cars registered in Germany has grown significantly in recent years, increasing from 470,559 in 2022 to 524,219 in 2023.
- Automotive manufacturers in Germany are constantly striving to improve the energy efficiency of vehicles. Semiconductor technology enables more efficient power management and control systems, resulting in decreased energy consumption and increased overall efficiency. With stricter regulations on fuel economy and emissions, the demand for automotive semiconductors that contribute to energy-efficient solutions will continue to rise.
- Autonomous driving is the future of transportation, and semiconductors are at the heart of this technological revolution. These components power the advanced sensors, cameras, LiDAR, radar, and AI processors that enable autonomous vehicles to perceive, interpret, and respond to their surroundings. Semiconductors facilitate complex decision-making algorithms, ensuring the safety and reliability of autonomous driving systems. German semiconductor companies are at the forefront of developing sensors, vision systems, and AI chips that enable vehicles to perceive their surroundings and make intelligent decisions in real time.
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