Semiconductors for Autonomous Vehicles13 September 2018Contents
Overview of the ADAS and Level 4/5 Driving Debate ...... 3
Semiconductor revenue impact is limited near term . 4
The Evolutionary versus Revolutionary Approach ...... 6
Level 4/5 semis content per vehicle to increase10-fold over Level 1/2 ......... 7
Deep Dive into Semis for ADAS(Levels 1, 2, and 3) ....... 10
What individual products make up ADAS . 10
ADAS Level 1 Features Becoming Standard11
ADAS Level 1: ~$80/vehicle of semis content ......... 13
ADAS Level 2/3 unit forecasts vary significantly, but content per vehicle
appears well known ........... 14
ADAS profitability attracts competition from across the value chain ........... 15
When will Level 2/3 Vehicles Become Material for Silicon Vendors ........... 18
Deep Dive into Semis for Level 4/5 Autonomy .... 20
Silicon TAM for Level 4/5 Autonomy .......... 24
Sales and Earnings Materiality for our Coverage Universe ........ 26
NVDA Earnings Materiality . 29
Intel Earnings Materiality .... 31
Texas Instruments Materiality ......... 33
ADAS Impact on TSMC ...... 34
Timothy Arcuri
Analyst
timothy.arcuri@ubs
+1-415-352 5676
David Mulholland, CFA
Analyst
david.mulholland@ubs
+44-20-7568 4069
Eric J. Sheridan
Analyst
eric.sheridan@ubs
+1-212-713 9310
Nicolas Gaudois
Analyst
nicolas.gaudois@ubs
+852-2971 5681
Kenji Yasui
Analyst
kenji.yasui@ubs
+81-3-5208 6211
Bill Lu
Analyst
bill.lu@ubs
+852-2971 8360
Patrick Hummel, CFA
Analyst
patrick.hummel@ubs
+41-44-239 79 23
Colin Langan, CFA
Analyst
colin.langan@ubs
+1-212-713 9949
Kohei Takahashi
Analyst
kohei.takahashi@ubs
+81-3-5208 6172
Omar Dessouky, CFA
Associate Analyst
omar.dessouky@ubs
+1-415-352 5522
John Ahn
Analyst
j.ahn@ubs
+1-415-352 5624
Pradeep Ramani
Associate Analyst
pradeep.ramani@ubs
+1-415-352 5517
Semiconductors for Autonomous Vehicles13 September 2018Overview of the ADAS and Level 4/5
Driving Debate
This research report summarizes our views on how the trend towards self-driving
vehicles will impact the financial performance of companies in our semiconductor
coverage universe.Leveraging the work of our automotive team (link
)
we dig into
the key debates, partnerships, and semiconductor-based platforms available in
today's market and in the future.
Demonstrations and announcements by automotive manufacturers, global
technology giants, and regulatory authorities support the view that technologies
being developed today will assist and eventually replace the need for human
driving skill in passenger vehicles, as time progresses.The requirement for human
intervention stops after Level 3 (see Figure 1), where a step change-increase in
technological capabilities are required to make driving on public streets safe.We
think this bifurcates the market into two distinct semiconductor opportunities,
each with its own cast of characters, revenue timeline, and market dynamics.
Levels 2 and 3 represent
advanced
driving assistance, whereby electronics can
assume a material degree of control over the operation of the vehicle, benefitting
the driver by reducing accidents, saving fuel, and facilitate dull tasks like parking
and driving in heavy traffic.We think of Level 1 features as monitoring systems
that provide the driver incremental information to avoid accidents and ease driving
in general; the driver must act on the information and the car does not take
material control of the vehicle.Semiconductor, sensor, and AI technologies
capable of playing an effective assisting role are widely available today.
Human drivers are not required at
Level 4 and up, meaning a step-
change in technology is needed to
make driving on public streets safe
Semiconductor, sensor, and AI
technologies needed to provide
advanced driver assistance (ADAS)
are widely available to carmakers
today
Semiconductors for Autonomous Vehicles13 September 2018Figure 1: Level 2 & 3 are Advanced Driver Assistance, and Level 4/5 are considered truly autonomous
Source:UBS, Society of Automotive Engineers
Semiconductor revenue impact is limited near term
News headlines generated by automotive manufacturers, semiconductor firms, and
global tech giants may give the impression ADAS and Level 4/5 vehicles will
significantly boost sales in the near future.While virtually all ecosystem players
have publicly indicated their roadmaps for Levels 1 through 5, their indications of
timing usually represent the earliest dates by which their technologies will be
available in production vehicles (see Figure 2).Virtually all ecosystem players have
indicated full Level 5 autonomy (no steering wheel) after 2021, but a significant
number of players have indicated Level 3 and Level 4 launches within the next
three years, by 2021.While these estimates will reflect the best-guess of each
management team, factors technological immaturity/advances, ecosystem
collaboration, and market opportunity timing could cause revisions in launch date
expectations.Nonetheless, the roadmaps publicized serve as useful guideposts for
both investors and ecosystem partners to evaluate how to invest their resources.
OEMS, Tier 1s Suppliers
Semiconductor Companies
Tech Giants & Startups
ADAS
A significant number of players
have indicated Level 3 and Level 4
launches by 2021, but technological
maturity, collaborations, and
market timing could results in
revised launch dates。