Automotive semiconductor market is expected to grow at a CAGR of 12% during the forecast period of 2022 to 2030. In spite of the shortage of automotive semiconductors around the world, it is anticipated that the market revenues will surpass $115 billion by 2030 from $36 billion in 2020. The development of vehicle-based technology, such as the introduction of advanced driver assistance systems (ADAS), telematics, and infotainment, as well as an increased propensity toward the purchase of electric vehicles, contributes to the expansion of the automotive semiconductor market around the world.
Due to the Impact of COVID-19, global community is currently facing an unprecedented economic, humanitarian, and healthcare challenge as a result of COVID-19. Because of the disease's rapid spread, there has been a marked decrease in the demand for public transportation around the world, which has had a substantial influence on the global transportation business.
Nevertheless, Impact of Russia, Ukraine conflicts has affected both the supply chain for semiconductors and the market for automotive have been subjected to further uncertainty as a result of Russia's invasion of Ukraine. For instance, Ukraine provides about 25% to 35% of the world's purified neon gas, and Russia provides between 25% to 30% of the palladium that is used in semiconductors. Both of these commodities are rare metals. Another complexity is that the majority of semiconductors are shipped via air, yet the costs of shipping have dramatically grown while the volume of available cargo space has decreased. Another issue is that original equipment manufacturers (OEMs) have been unable to obtain essential vehicle components.
However, Semiconductors are Crucial Element in Automotive, in reality, in automotive industry, a semiconductor is used to control the fail-safe system, manage the functions of the electrical control unit, and create automotive fault tolerant systems.
Moreover, Semiconductor Application in Enhancing Vehicle Safety Remains as the Key Market Driver. According to a report that was published by the World Health Organization in 2021, about 1.3 million people lose their lives in collisions with motor vehicles. In addition, the number of youths who die as a result of injuries sustained in car accidents is higher.
The increasing scarcity of chips is forcing businesses in the automobile industry to place orders for additional semiconductors that are around 10 to 20 percent higher than what is required. Businesses in all sectors are placing an increasing number of ad hoc orders, frequently at an extremely high average sales price.
Although the chip shortage is having an effect on a wide variety of industries, the automobile sector is particularly hard hit because of some distinct characteristics that make the problem even worse.
Increasing Demand for Electric Vehicle to Support High CAGR trend. Hence, the key factor that is expected to lead to the demand for electrical vehicles during the future period is the reduction of the cost of individual components such as lithium-ion batteries, sensors, and microcontrollers. The market for electrical vehicles is anticipated to grow at 35% by the year 2040. Nexteck Singapore Pte Ltd is also enhancing our production lines and enlarging capacity to meet with our customers demand.
Under above situations, micro components held the largest share of revenues in 2022. It is anticipated that the increasing use of micro components (processors) in a variety of automotive systems, including anti-lock braking systems (ABS), tyre pressure monitoring systems (TPMS), electronic stability control (ESC), and others, will drive the growth of this segment during the forecast period of 2023 to 2030. As a consequence of this, it is projected that the micro-components segment will hold a significant portion of the market share. WLCSP packing materials like Nexteck cover tape, carrier tape will for micro chips will be demanding in our forecast.
