Category: AUTOMOTIVE

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Automotive Semiconductor

Over the last two decades, the global automotive industry has undergone a fundamental transformation. A new class of automakers, established in the context of accelerating electrification, autonomy, and software-defined mobility, has emerged to challenge long-standing paradigms in vehicle design, manufacturing, and systems integration.

Unlike their legacy counterparts rooted in internal combustion and mechanical engineering, these companies were founded when semiconductors had become central to the vehicle’s core functionality.

From powertrain electrification and real-time sensor fusion to functional safety systems and edge computing for autonomous decision-making, modern cars have evolved into highly integrated, compute-intensive platforms.

This shift places semiconductors at the center of vehicle architecture, governing performance, user experience, system reliability, and over-the-air serviceability. In this new automotive landscape, chip architectures, embedded software, and electronic subsystems are now as critical to competitive differentiation as the engine or chassis once were.

Why Focus On New-Age Automakers?

Traditional carmakers are adapting to EVs and autonomy, but newer players are born-native to software, electric powertrains, and platform thinking. Many of these companies began with the core assumption that:

• Cars will be electric (or will use alternate fuel)
• Driving will be assisted or autonomous
• User experience will be digitally driven
• Supply chains will increasingly revolve around silicon

Their clean-sheet approach often puts them ahead on integration, over-the-air (OTA) updates, and leveraging high-performance chips. All while increasing the user experience.

New-Age Automakers Since 2005

In the past two decades, numerous new automotive manufacturers have emerged worldwide. Below is a comprehensive summary of these “new-age” automakers founded in 2005, covering passenger cars, commercial vehicles, and niche manufacturers. Each entry lists the company’s name, founding year, country of origin, market size (latest production volumes or valuation), target market segment, and vehicle type (EV, hybrid, etc.).

North America (United States And Canada)

The North American automotive sector has seen a wave of new companies born into the era of electrification, autonomy, and software-defined vehicles. These firms are redefining vehicle architecture and accelerating semiconductor integration across segments from luxury EVs to commercial platforms.

Europe

Europe has emerged as a hub for next-generation automotive startups, with companies targeting electric hypercars, solar mobility, and urban transport. These firms are advancing new powertrain architectures, modular manufacturing, and software-driven design across diverse market segments.

Asia – China

China has rapidly become a global epicenter for electric vehicle innovation, driven by a wave of startups founded in the last decade. These companies prioritize smart features, autonomous driving capabilities, and localized supply chains. Several have already reached significant production scale and are expanding globally, positioning China as a leader in next generation mobility.

Asia – Other Regions (India, Southeast Asia, Middle East, Africa)

Across India, Southeast Asia, the Middle East, and Africa, new automotive companies have emerged, addressing local market needs with electric mobility, affordability, and regional manufacturing. These companies range from high-volume e-scooter producers and electric bus makers to ultra-luxury and government-backed initiatives. Together, they represent a critical extension of the global shift toward sustainable and localized automotive innovation.

What This New-Age Automakers Mean For The Automotive Semiconductor Industry

This new generation of automakers is not merely a business disruption. A structural shift intensifies the demand for semiconductors across the automotive stack. A modern vehicle today, integrates more than 100 different types of silicon solutions, and this number is set to grow as autonomy, connectivity, and software-defined features expand.

What matters is not just chip volume but compute density and architectural dependency. ADAS, infotainment, and battery systems now rely on advanced SoCs and specialized silicon with performance levels approaching data centers.

Key implications for the semiconductor industry:

• Co-development is becoming standard as automakers involve chipmakers early in the design process
• Domain-specific architectures are evolving faster by leveraging innovations from AI, mobile, and high-performance computing
• Power electronics, safety systems, and battery management require integrated, real-time, capable solutions
• Regional supply chains and custom silicon initiatives are gaining momentum in strategic market

As new automakers scale, semiconductor companies must align closely with their timelines, architectures, and localized production strategies. Success will depend on delivering optimized computing and resilient system design.

Thus, semiconductors are no longer peripheral to vehicles. They are now the foundation of performance, safety, and product differentiation.

Photo by Vasilis Chatzopoulos on Unsplash

The automotive industry is increasingly using semiconductor XPUs to power advanced driver assistance systems (ADAS) and autonomous driving features. XPUs perform specific tasks, such as image processing, object detection, and machine learning, much faster than traditional CPUs. Making them ideal for use in ADAS and autonomous driving systems, which require real-time processing of large amounts of data.

The XPU types include CPU, GPU, and APU. CPU is the most widely used type of XPU in the automotive market. GPU is gaining traction in the market due to its high performance and energy efficiency. APU is a new type of XPU specifically designed for machine learning applications. The choice of which XPU to use in an automotive application depends on several factors, covering the application requirements, the budget, and the desired performance.

Central Processing Unit (CPU): It executes the instructions that control various vehicle functions. The CPU controls the engine, transmission, braking system, and other electronic systems. The CPU in automotive applications is supposed to be high-speed, low-power, and highly reliable. It is responsible for executing complex algorithms and communicating with other systems in the vehicle. The CPU is a critical component in the vehicle’s electronic system, as it controls the overall performance and safety of the car.

Graphics Processing Unit (GPU): The GPU is responsible for handling the graphical processing tasks in the vehicle’s infotainment system. The GPU is responsible for rendering 3D graphics, video decoding, and image processing. It also plays a crucial role in ADAS systems and is commonly used for object detection, lane departure warnings, and other visual recognition tasks. The GPU is for parallel processing, which allows it to handle multiple tasks simultaneously. It is an ideal solution for managing complex graphic and visual processing tasks in automotive applications. In automotive applications, power consumption is a crucial factor. That’s why the GPU should get designed to be power-efficient, ensuring its effectiveness.

Accelerated Processing Unit (APU): The APU is a mix of CPU and GPU in a single chip. The APU provides high-performance computing capabilities while consuming less power. The APU is an ideal solution for automotive applications with limited space and energy. The APU finds applications in various automotive applications, including infotainment systems, ADAS systems, and autonomous driving systems.

The global automotive XPU market size was valued at USD 1.5 billion in 2021 and will reach USD 10 billion by 2028, growing at a CAGR of 19.2% from 2022 to 2028. The increasing demand for autonomous features in cars is driving the growth of the XPU market, which is crucial in providing real-time processing of large amounts of data, such as sensors, maps, and weather data.

The automotive XPU market by region is segmented into North America, Europe, Asia Pacific, and the Rest of the World. North America is the largest market for automotive XPUs. Europe is the second largest market for automotive XPUs. Asia Pacific is the fastest-growing market for automotive XPUs.

Several top semiconductor companies invest heavily in research and development to develop new and innovative XPUs. Some details about semiconductor automotive XPU investment for research and development and new product launch:

Nvidia: In 2022, Nvidia announced a $10 billion investment in automotive over the next four years. This investment will bring new XPUs, software, and services to the automotive industry. Nvidia also plans to launch a new automotive platform called the DRIVE Hyperion 9 in 2025. The DRIVE Hyperion 9 will be a fully integrated platform that includes everything from sensors to software to computing.

Intel: In 2021, Intel announced a $20 billion investment in self-driving technology over the next decade. This investment will enable the development of new XPUs, software, and sensors for self-driving cars. Intel also plans to launch a new self-driving car platform called the Mobileye EyeQ5 in 2023. The EyeQ5 will be a powerful XPU that can handle the complex computing requirements of self-driving cars.

Qualcomm: In 2022, Qualcomm announced a $10 billion investment in automotive over the next five years. It is to develop new XPUs, software, and services for the automotive industry. Qualcomm also plans to launch a new automotive platform called the Snapdragon Ride in 2024. The Snapdragon Ride will be a fully integrated platform that includes everything from sensors to software to computing.

Samsung: In 2021, Samsung announced a $17 billion investment in semiconductor manufacturing over the next three years. This investment will bring new semiconductor factories to fabricate new semiconductor technologies. Samsung also plans to launch a new automotive XPU called the Exynos Auto V10 in 2025. The Exynos Auto V10 will be a powerful XPU that can handle the complex computing requirements of autonomous cars.

Renesas: In 2022, Renesas announced a $2 billion investment in automotive over the next five years. Such an investment will bring new XPUs, software, and services to the automotive industry. Renesas also plans to launch a new automotive platform called the R-Car V4H in 2024. The R-Car V4H will be a powerful XPU that can handle the complex computing requirements of autonomous cars.

As the automotive industry continues to evolve and innovate, the demand for processing solutions will only grow. It presents an exciting opportunity for developers and engineers to create new and innovative solutions that will shape the future of the automotive industry.

Photo by Chris Liverani on Unsplash

Automotive has always been an integral part of day-to-day life. Worldwide, billions of people drive vehicles, and the goal is the same: reaching the next destination safely and on time. Achieving this goal is only possible due to the different features and components that come together to enable an end product that can zoom safely.

A lot of effort goes behind the scenes to meet customer demand and automotive safety requirements. Any given vehicle demands thousands of tiny parts procured (or manufactured) from different vendors. Eventually, all these components need to work synchronously to provide the safest ride possible.

Safety: Silicon products enable real-time decision-making, a must-have feature for maintaining the standard of automotive safety.

Autonomy: Autonomy focuses on assisting safe rides, and it requires error-free silicon products that can work in any conditions.

In this line, one of the vital part, whose share in automotive products have increased steadily year on year, is a semiconductor. Semiconductors are part of every vehicle out on the road. These tiny devices (packaged as silicon chips) enable different features.

In the last decade alone, the number of semiconductor products in modern vehicles has increased by 10x. Such a drastic increase in demand is majorly due to new features apart from the need to make every ride a safe and enjoyable one. It is also evident from the growing demand for automotive-focused semiconductor solutions, which will increase further with the adoption of more alternate-fuel solutions that will increase the share of semiconductors in next-gen vehicles.

One of the drastic changes in the automotive industry is the centralization approach. CAN-based solutions were already available for decades. However, the availability of more reliable XPU based solutions has pushed the centralization towards a new era and is transforming automotive into a computer on the wheels. Thus, opening up the market for companies that never focused on automotive segments.

It also implies that the thermodynamics of automotive products is changing and slowly becoming semi-dynamics. In the semi-dynamics world, the decision is driven by silicon products while also working alongside the traditional thermodynamic system. Such reliance will grow further, already has, with alternate-fuel, hybrid, and electric approaches.

Centralization: Automotive products are getting loaded with high-performance computer chips, which are more centralized than ever before.

Features: New features require new silicon products that focus on improving customer experience by enabling highly reliable products.

Even though automotive semiconductor demand is increasing, it will not be easy for emerging companies to make the most of the growing market. The reason is the safety, quality, and reliability standards that automotive products demand. It is not only time-sensitive but also capital intensive. Still, there are promising upcoming automotive semiconductor-focused emerging companies making the mark in the market. However, such companies will face stiff competition from the existing established players.

The next decade will be an exciting one for automotive semiconductor companies. The focus will be on highly dynamic, safe, and reliable semiconductor-driven products that will enable a new ear of transforming mobility.

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THE IMPACT OF SEMICONDUCTOR SHORTAGE ON AUTOMOTIVE INDUSTRY

Automotive is one of the several industries that heavily rely on semiconductor products to provide different features. These features range from infotainment to sensors to wireless communication. Over the last few decades, the need to drive such advanced features has increased the share of semiconductor products in automotive manufacturing.

Due to the heavy dependence on automotive semiconductor products, the automotive industry has also been impacted because of the semiconductor shortage. The non-availability of the automotive semiconductor product has certainly brought several challenges for the automakers (and OEMs) and worldwide automakers are now struggling to keep their production line up and running.

In the end, automakers also have to rely on OEMs to provide the sub-systems that their production line uses. The delay is more because the OEMs are not able to procure the silicon chips (from OSATs and FABs) required to provide the end systems that automakers use to assemble different vehicles. Eventually, the impact is felt on the end product (vehicles) and this is why the focus has shifted more on automakers than the OEMs.

Below are the major impacts of the automotive semiconductor shortages on the automotive industry:

Delay: Semiconductor capacity crunch has lead to a shortage of critical automotive semiconductor products. Automakers are not able to ship or sell vehicles without these vital silicon chips. This has lead to a backlog of orders and slowly causing leading to the halt of several automotive production lines. Given how strict the quality and reliability requirements of automotive semiconductors are, it is difficult to switch the FABs and OSATs where the capacity might be available. All this is impacting automakers with severe delay in providing the last piece of silicon automakers need.

Revenue: Automaker’s OEM vendors are not able to procure the required number of silicon chips to design automotive systems that are needed by different vehicles. This has caused a supply chain gap and has impacted the revenue (slow production line) of the majority of the automakers even though the demand is high.

Human Resource: Due to the slow or halted production lines, the automotive manufacturers are taking tough decisions to lower the loss caused by the semiconductor shortage. One such decision is layoffs and unfortunately, it is leading to job losses.

Planning: Automakers worldwide launch new models and trims every year. Due to the semiconductor shortage, automakers are not able to plan out their future product launches. This is severally impacting their long-term planning and more so when it comes to launching alternate-fuel technologies to drive next-gen vehicles.

Cost: As it happens in any other industry, the slow production has to lead to a supply crunch and this is leading to a rise in the cost of vehicles. On top of this, the cost to develop new products and solutions has also gone up mainly due to the impact on timeline and schedule caused by the semiconductor shortage.

The severe impact of the automotive semiconductor shortage has prompted the automotive industry to take a serious look at the importance and share of semiconductors in automotive manufacturing.

As the world moves towards alternate-fuel technologies to drive next-gen automotive products, the share of automotive electronics (developed by the semiconductor industry) will keep increasing. This implies that any semiconductor shortage in the future will also keep impacting the automotive industry.

The corrective actions (based on semiconductor shortage) will take years of planning and investment, and it is about time that the automakers (more than the OEMs) start preparing themselves for future implications today.

THE RECIPE TO MERGE SEMICONDUCTOR INTO AUTOMOTIVE MANUFACTURING

Every industry that has been impacted by the semiconductor shortage has started preparing backup plans for the future. This is mainly true for the OEMs who could not procure the semiconductor chips required to develop their system so that their customers can use and ship the end product out of the manufacturing facilities.

When any other manufacturing industry is compared with automotive manufacturing, the major difference that stands out is the amount of investment and big plants that are required to keep assembling the new vehicles. On a positive note, the experience of handling large manufacturing facilities provides the automotive industry an edge mainly due to the vast experience in building complex machines. If planned well, there is no question that the automotive industry can easily adapt and embrace non-automotive (semiconductor) manufacturing facilities.

Automotive manufacturing is indeed heavily dependent on OEMs. More so for systems that are built using semiconductor chips and end up getting plugged during the automotive assembly process. This dependence has grown with the growing importance of semiconductor products that are required to build a more advanced automotive solution than its predecessors.

Semiconductor Design -> FAB -> OSAT -> OEM -> Automotive Manufacturing

For automotive manufacturing, if there is one important question that comes out of the semiconductor shortage saga, then it is about how to mitigate future semiconductor shortages. To answer this question, several automotive manufacturers have already started preparing plans to make themselves self-sufficient for future semiconductor needs. In reality, it will take a lot of time and effort, but such push by the automotive industry is inevitable.

Irrespective of the path taken by different automakers, the below recipe can be used to understand how to merge semiconductor manufacturing into the automotive manufacturing process:

Cluster: Setting up semiconductor manufacturing (mainly FABs and OSATs) is a big investment. It requires years of planning and then billions of dollars to execute and thereafter millions to keep the facilities active. It is a risk that few key players have taken. What the automotive industry should focus on is a cluster-based approach wherein different automakers pool money and resources to create a network of automotive-focused FAB and OSAT facilities. This can be a multi-tier JV that can drive the manufacturing of critical automotive semiconductor products. These cluster facilities can also balance out the semiconductor manufacturing capacity worldwide.

In-House Capacity: Apart from the cluster semiconductor manufacturing approach, automakers can also find avenues to build semiconductor manufacturing capacity in-house. This is certainly not easy to execute and there are only a handful of automakers that will have the kind of investment required to drive FABs and OSATs. But this is certainly the way to go because the importance of semiconductors in providing new technology features will keep increasing.

Team: Irrespective of whether the automotive manufacturers end up building their semiconductor manufacturing facilities or not, there should be a push to create a network (within and outside) of semiconductor teams that can provide insights into the design and manufacturing of next-gen semiconductor products. This can help automakers understand which target features can be optimized using a different set of available semiconductor features. This can also be a way to make automakers self-sufficient when it comes to the automotive semiconductor.

Acquisition: Automakers should start acquiring emerging companies that provide automotive semiconductor solutions. They can do so by focusing on critical automotive features like LIDAR, RADAR, CMOS cameras, sensor-based tech, and even centralized XPUs for future autonomous vehicles. In the end, these strategic acquisitions will help automotive companies drive in-house semiconductor design operations, which can slowly kickstart the need to move towards the manufacturing aspect of semiconductors, which can also be executed by acquiring small FABs and OSATs.

Investment: Even if automakers are not able to acquire semiconductor-focused emerging companies, they should start investing in semiconductor companies that can add value to their portfolio. This investment can be equally distributed towards both the design and the manufacturing aspects of the semiconductor.

When the world comes out of the semiconductor shortage (which can take anywhere from months to years), there are certainly going to be new players entering the semiconductor industry to take control of the different aspects of the semiconductor supply chain that affected their business.

One such industry will be automotive, and there is certainly going to be a push by automakers to make themselves self-sufficient to ensure that any future semiconductor shortage does not impact their production line.

The recipe to merge semiconductor manufacturing (and even design) with automotive manufacturing is readily available and the only missing links are the actions by the automakers.