Automotive Industry
Semiconductor Outlook
OCTOBER 2022Early signs suggest that the semiconductor supply will remain tight in the
coming years
The automotive semiconductor market isAs a result, some semiconductor supply
expected to grow by more than 9% annually challenges are expected to persist through 2026.
through 2030.· Shortages of analog chips and MEMS may persist given
· The adoption of electric vehicles (EVs) and advanced limited planned-capacity investments.
driver-assistance systems (ADAS) will substantially · Discrete-power chips may experience additional demand
increase the semiconductor content in vehicles, even pressure with the adoption of 800-volt vehicles; there may
as production volume remains steady. be insufficient wide-bandgap manufacturing capacity to
· Battery electric vehicles (BEVs), which are expected tomeet demand.
have the highest market share among EVs by 2026, have · Approximately 50% of future fabrication capacity is
twice the semiconductor content of internal combustion planned in mainland China, which will increase risk if the
engine (ICE) vehicles, owing to the need forplanned capacity does not come online or is inaccessible
discrete-power and analog chips.to Western OEMs and Tier 1 suppliers.
· ADAS Level 2+ is expected to gain the largest market · Automotive demand growth will be highest for logic chips
share among assistance systems. Each additional level ofmade on 20nm to 45nm nodes in order to meet the
sophistication exponentially increases the need forincreasing computing needs of centralized
memory and logic computing.electrical/electronic architectures; we expect this to ease
demand pressure on mature node sizes larger than 55nm.
Source: BCG analysis.
Note: ADC = analog-to-digital converter; E/E = electrical/electronic; IGBT = insulated gate bipolar transistor; MEMS = microelectromechanical systems; MOSFET = metal oxide semiconductor field effect transistor; nm = nanometer; OEM = original equipment
manufacturer.Pandemic-induced manufacturing and logistics challenges are easing, but supply
issues will persist
SEMICONDUCTOR DEMAND AND SUPPLY, INDEXED TO THE QUARTERLY AVERAGE OF 2018
2018–2019Q1–Q2 2020 2020–2021 2022–2023
Baseline market cycle Demand dipDemand shock Ongoing supply issues likely
140Forecast
Demand
Supply
Demand outlook
The demand outlook for the(no easing)
remainder of 2022 and 2023 has
Demand outlook
eased, while the supply forecast
(with easing)
has improved with the inclusion of
new capacity, primarily in ChinaDemand < Supply
Averages
Demand > Supply
Demand: 100Demand: 99Demand: 99Demand: 118 Demand: 121–123 Demand: 124–127
Supply: 100 Supply: 101 Supply: 103 Supply: 106Supply: 113Supply: 123
0 (Baseline)
201820192020202120222023
Sources: BCG IC Model Forecast; BCG analysis.
Note: Semiconductors are purchased one quarter before the actual end-market sales year. Demand forecasts are determined by expected demand of representative industries. Supply forecasts are determined by foundry capacity. Semiconductor memory
devices not included in this analysis.The auto industry currently occupies a small share of the semiconductor market,
but it’s growing rapidly
GLOBAL SEMICONDUCTOR DEMAND BY SEGMENT (%) 2021–26 CAGR
$591B $767B Total: 5%
8 11Share expected to grow based on strong demand to
Auto 11%
1111support EVs and ADAS
Consumer
23 4% Stable growth, near market average
27 electronics
Adoption of cloud storage and computing will support
10Data center 9%
12continued growth
25 Strong demand growth expected, to support adoption
21 Industrial 9%
of connected solutions and smart machines
1410
Smart phones 2% Growth will slow coming out of 5G super cycle
9 9
2021 2026 Pandemic-driven refresh cycle will trend downward
PCs–2%
xEVs 15%60%before reaching steady state
Auto
adoption
ADAS Level 3 1%5% Others1 7%
or Higher
Below market average Above market average
Sources: Gartner; BCG analysis.
1Other industries include aerospace and defense and communications infrastructure.Increasing semiconductor content per vehicle will promote demand, even as total
vehicle production remains steady
LIGHT VEHICLE PRODUCTION (MILLIONS) SEMICONDUCTOR CONTENT PER VEHICLE, BLENDED AVERAGE ($)
ForecastForecast
+6.9%
+2.2%
1,100 1,170
980 1,040
88 89 90 9293 94890 940
77 79 83 85770 820
640 710
2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Sources: Gartner; Strategy Analytics; BCG IC model forecast; BCG analysis.