Passenger Cars Semiconductor Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Component Type (Processor, Analog IC, Discrete Power Device, Sensor, Memory Device), By Application Type (Powertrain, Safety, Body Electronics, Chassis, Telematics & Infotainment) By Region & Competition, 2020-2030F

Market Overview

The Global Passenger Cars Semiconductor Market, valued at USD 52.80 Billion in 2024, is projected to experience a CAGR of 8.18% to reach USD 84.65 Billion by 2030. Passenger car semiconductors are integrated circuits critical for managing and enabling diverse electronic functions within modern vehicles, encompassing everything from engine control units and advanced safety systems to sophisticated infotainment and connectivity features. Key drivers propelling this market include the increasing integration of electronic content per vehicle, stringent safety regulations demanding advanced driver-assistance systems, and the accelerating global transition towards vehicle electrification, necessitating specialized power management and control semiconductors.

However, a significant challenge to market expansion remains the persistent vulnerability of global supply chains, leading to semiconductor shortages and production delays across the automotive industry. Providing a quantitative perspective on the underlying demand, according to the International Organization of Motor Vehicle Manufacturers (OICA), global motor vehicle production reached 93.5 million units in 2023, marking a 10% increase from 2022. This production volume directly influences the demand for semiconductor components in passenger cars.

Key Market Drivers

The Global Passenger Cars Semiconductor Market is fundamentally reshaped by the significant growth in vehicle electrification. This driver mandates a profound increase in power semiconductors, microcontrollers, and various sensors for high-voltage system management, battery thermal management, and electric powertrain control. As manufacturers transition from internal combustion engines, the electronic content within each vehicle substantially rises, boosting demand for specialized silicon carbide and gallium nitride devices crucial for efficient power conversion and faster charging. These advanced materials optimize electric vehicle performance and range. According to the International Energy Agency, in 2023, approximately 9.5 million battery electric vehicles were sold globally, illustrating this segment's rapid expansion and direct demand for semiconductor components.

Concurrently, the expansion of Advanced Driver Assistance Systems (ADAS) presents another pivotal force in the semiconductor market. ADAS features, from adaptive cruise control to automatic emergency braking, rely on sophisticated semiconductors, including high-performance processors, image signal processors, radar, lidar, and ultrasonic sensors, along with memory solutions. These systems process extensive environmental data in real-time, requiring robust, high-speed computing capabilities. The increasing sophistication and mandated inclusion of these safety-critical systems directly translates into higher semiconductor content per vehicle. According to National Collision Repairer, in 2023, forward collision warning and automatic emergency braking systems were present in 94 percent of vehicles, highlighting the pervasive integration of ADAS technologies. This underlying demand underscores the broader market expansion, with a major supplier noting according to Infineon's annual report, in 2023, its automotive segment revenue was 8242 million euros.

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Key Market Challenges

The persistent vulnerability of global supply chains represents a significant impediment to the expansion of the Global Passenger Cars Semiconductor Market. This challenge leads directly to semiconductor shortages and subsequent production delays within the automotive industry, thereby constraining the overall output of passenger vehicles. Reduced vehicle manufacturing capacity, irrespective of robust end-user demand, directly curtails the volume of semiconductor components integrated into new cars.

For instance, according to the European Automobile Manufacturers' Association (ACEA), in 2024, car production in the EU declined by 6.2%, reflecting the direct consequences of various industrial headwinds, including continued supply chain fragility. Such production shortfalls inherently limit the achievable market size for passenger car semiconductors. Furthermore, a study commissioned by the German Association of the Automotive Industry (VDA) in January 2023 projected that the sustained shortage of semiconductors could lead to a global drop in automotive production of 20% by 2026, underscoring the severe, ongoing nature of this challenge to market growth.

Key Market Trends

The Global Passenger Cars Semiconductor Market is significantly influenced by two distinct and impactful trends: the widespread shift towards software-defined vehicle architectures and the increasing adoption of in-house semiconductor design by Original Equipment Manufacturers. These trends are profoundly reshaping development strategies and supply chain dynamics within the automotive industry.

The shift to software-defined vehicle architectures significantly alters automotive semiconductor demand, evolving from distributed electronic control units to centralized, high-performance computing platforms. This necessitates powerful central processing units and advanced memory for managing complex software and enabling over-the-air updates. According to the Semiconductor Industry Association, semiconductor content for zonal controllers, critical to these new architectures, is projected to rise from $511 million in 2022 to $21.8 billion by 2030, indicating substantial market expansion. This trend enables automakers to continuously enhance vehicle functionality and customer experience through software.

Automotive Original Equipment Manufacturers are increasingly pursuing in-house semiconductor design for supply chain resilience and competitive differentiation via custom silicon. This strategic vertical integration involves direct investments in internal design and collaborations for developing specialized chipsets, optimizing performance and security. The European Automobile Manufacturers' Association reported the European automotive industry invested €73 billion in research and development in 2023, an increase of €14 billion from 2022, underscoring commitments to advanced technology, including proprietary semiconductor solutions. For instance, Stellantis announced in July 2023 direct agreements for semiconductors exceeding €10 billion through 2030, securing crucial microchips for its new electrical architectures and reflecting strategic influence on supply.

Segmental Insights

The Safety Systems segment is experiencing rapid growth in the Global Passenger Cars Semiconductor Market, primarily driven by stringent global safety regulations and increasing consumer demand for advanced vehicle safety. Regulatory bodies, such as the European Union, with its General Safety Regulation, mandate the inclusion of advanced driver-assistance systems (ADAS) in new vehicles to enhance road safety. This legislative pressure, coupled with a growing consumer preference for features like automatic emergency braking and lane-keeping assistance, fuels the demand for sophisticated semiconductor solutions within this segment. Technological advancements in areas such as sensor technology and artificial intelligence further accelerate this expansion, making vehicles safer and more intelligent.

Regional Insights

Asia Pacific stands as the leading region in the Global Passenger Cars Semiconductor Market, driven by its robust manufacturing ecosystem and substantial automotive sector growth. The region benefits from a concentration of major semiconductor manufacturers, particularly in Taiwan and South Korea, which command significant global production capacity for advanced chips. This dominance is further fueled by the rapid expansion of electric vehicle adoption and advanced driver-assistance systems within Asia Pacific, notably in markets like China, creating considerable demand for automotive-grade semiconductors. Additionally, supportive government initiatives, such as Japan's Ministry of Economy, Trade and Industry policies and China's 14th Five-Year Plan, promote domestic industry development and technological advancements, solidifying the region's market leadership.

Recent Developments

• In May 2025, NXP Semiconductors introduced its new S32R47 imaging radar processors, fabricated using 16 nm FinFET technology. This third generation of imaging radar processors offered up to double the processing capability compared to its predecessor, alongside improvements in system cost and power efficiency. Designed to meet the stringent requirements of Level 2+ to Level 4 autonomous driving, these processors enabled higher resolution sensing for advanced applications like detecting vulnerable road users and enhancing navigation in software-defined vehicles. The S32R47 family was developed to prepare the automotive industry for the next levels of autonomous driving in passenger cars.

• In January 2025, Arm and Nvidia deepened their collaboration to advance software-defined vehicles. This partnership focused on developing sophisticated processing and connectivity solutions, addressing the automotive sector's increasing demand for generative AI applications and advanced autonomous features. The initial outcome of this collaboration was the introduction of the Nvidia Drive AGX Thor centralized compute system, built on Nvidia's Blackwell architecture and utilizing Arm Neoverse V3AE, a central processing unit optimized for automotive use. This initiative aimed to deliver server-class performance for complex AI demands in future production vehicles.

• In November 2024, Infineon Technologies announced the launch of its AURIX™ TC4Dx microcontroller (MCU), the initial offering from its latest AURIX TC4x family. Based on 28nm technology, the AURIX TC4Dx delivered enhanced performance and high-speed connectivity. This new MCU combined power and performance upgrades with features for virtualization, artificial intelligence, functional safety, cybersecurity, and advanced networking functions. It was designed to facilitate new Electric/Electronical (E/E) architectures and the development of next-generation software-defined vehicles, serving as a critical component for controlling and monitoring various systems in passenger cars.

• In September 2024, STMicroelectronics launched its fourth-generation STPOWER silicon carbide (SiC) MOSFET technology. This advancement represented a breakthrough in power efficiency, density, and robustness for automotive and industrial applications. Specifically, this technology was optimized for electric vehicle (EV) traction inverters, enhancing energy efficiency and performance in both 400V and 800V platforms. The introduction aimed to expand the benefits of silicon carbide beyond premium EV models to mid-size and compact electric vehicles, thereby supporting the adoption of more affordable and sustainable electric transportation in the global passenger cars semiconductor market.

Key Market Players

• Infineon
• NXP
• Renesas
• Texas Instruments
• STMicroelectronics
• Bosch
• ON Semiconductor
• Microchip
• Analog Devices
• Toshiba

Report Scope:

In this report, the Global Passenger Cars Semiconductor Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Passenger Cars Semiconductor Market, By Component Type:

o   Processor

o   Analog IC

o   Discrete Power Device

o   Sensor

o   Memory Device

• Passenger Cars Semiconductor Market, By Application Type:

o   Powertrain

o   Safety

o   Body Electronics

o   Chassis

o   Telematics & Infotainment

• Passenger Cars Semiconductor Market, By Region:

o   North America

§  United States

§  Canada

§  Mexico

o   Europe

§  France

§  United Kingdom

§  Italy

§  Germany

§  Spain

o   Asia Pacific

§  China

§  India

§  Japan

§  Australia

§  South Korea

o   South America

§  Brazil

§  Argentina

§  Colombia

o   Middle East & Africa

§  South Africa

§  Saudi Arabia

§  UAE

Competitive Landscape

Company Profiles: Detailed analysis of the major companies presents in the Global Passenger Cars Semiconductor Market.

Available Customizations:

Global Passenger Cars Semiconductor Market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

• Detailed analysis and profiling of additional market players (up to five).

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