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Recovery Forecast in Automotive Semiconductor Industry

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International. The automotive semiconductor industry is set to increase at a compound annual growth rate (CAGR) of 12.3% through 2025, immediately following a strong return of the pandemic, according to a new report from Omdia.

Semiconductor content in automobiles has steadily increased over the past decade, but several recent trend lines have combined to accelerate automotive semiconductor revenues, Notes Omdia in its new Automotive Semiconductor Market Tracker – 2H21 Analysis report.

Those trends include rising sales of battery electric vehicles (BEVs) and growing demand for advanced driver assistance systems (ADAS) and infotainment and telematics (I&T) systems, according to Sang Oh, senior research analyst for automotive semiconductors at Omdia and author of the market report.

"The average BEV generates 2.9 times more semiconductor revenue than a vehicle with a traditional internal combustion engine," Oh said. "In addition, ADAS applications, such as camera modules for parking assist and collision warning, in addition to I&T applications such as transitioning from analog or hybrid instrument clusters to digital clusters, are also driving greater semiconductor content."

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Recovering from the pandemic
COVID-19 dealt a significant blow to the global automotive semiconductor industry in the first half of 2020, as global vehicle production came to a halt during the early days of the pandemic. But the industry recorded a strong rebound from 3Q20.

The sector's recovery accelerated in 2021, with total annual revenues projected at US$51.6 billion, up 28.6% from the previous year. This came at a time when the overall automotive supply chain continued to experience disruptions, with global vehicle production growing relatively little by 2.5% in 2021 compared to the previous year.

"The much stronger recovery in the automotive semiconductor market than we see in the industry as a whole can be attributed to the dramatic increase in average car semis sales prices as supplies were restricted, as well as the tendency of electronics manufacturers to pre-order and increase their inventories and safety stocks," explained Oh.

Source: Omdia.

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