Automotive Chip Market Size and Share Outlook - Forecast Trends and Growth Analysis Report (2025-2034)

The global automotive chip market was valued at USD 54.05 Billion in 2024. The industry is expected to grow at a CAGR of 10.60% during the forecast period of 2025-2034. High-performance automotive chips are becoming increasingly necessary. These improve vehicle connectivity and user experience, and hence,are consumers demand these chips for sophisticated in-car technologies like voice control, infotainment systems, and tailored experiences. In turn, all these factors have resulted in the market attaining a valuation of USD 148.03 Billion by 2034.

Global Automotive Chip Market Report Summary

Market Size 2024

• USD Billion 54.05

Market Size 2034

• USD Billion 148.03
• CAGR 2025-2034
• 10.60%

CAGR 2025-2034 - Market by Region

• North America
• 11.5%

CAGR 2025-2034 - Market by Country

• Canada
• 12.4%

CAGR 2025-2034 - Market by Country

• UK
• 11.4%

CAGR 2025-2034 - Market by Application

Telematics and Infotainment

• 12.5%

CAGR 2025-2034 - Market by Vehicle

• Passenger
• 13.2%

Market Share by Country 2024

• UK
• 4.2%

Automotive Chip Market Overview

The automotive chip market is expected to expand rapidly because of increasing electronic integration in cars due to trends like connectivity, electrification, and automation, all drivers which point out that consumers expect advanced features such as infotainment systems, autonomous driving, and enhanced safety technologies. Apart from this, the growing transition toward EVs, with ever-rising data processing in vehicles, is fueling chip demand. Key players like NVIDIA, Intel, and Qualcomm are focusing on high-performance chips that fulfill needs across different vehicle applications. With further technological advancements and the pressing need to improve chip efficiency, the market is projected to open new avenues within the manufacturing industry.

Automotive Chip Market Growth

Electric vehicle expansion is a key niche that propels growth in the automotive chip market. These chips generally perform essential functions in battery management, power control, and motor systems. Although the EV market is growing, firms like Tesla and Rivian are putting pressure on the industry to develop more sophisticated semiconductor solutions that use less power in order to improve performance, driving range, and charging speed. Additionally, the need for smarter automobiles and vehicles that are connected encourages the development of infotainment systems, which in turn fuels the expansion of the market. Navigation, voice recognition, and streaming services are all part of infotainment systems, which are needed for extremely sophisticated CPUs. Companies like Qualcomm lead this niche with solutions fully integrated with modern car connectivity.

Key Trends and Recent Developments

The key trends of the automotive chip market include advanced chips for EVs, self-driving, infotainment, and supply resilience.

November 2024

In order to serve many automotive domains, such as Advanced Driver Assistance Systems (ADAS), in-vehicle infotainment (IVI), and gateway applications on a single chip, Renesas Electronics Corporation introduced a new generation of automotive fusion system-on-chips (SoCs).

October 2024

Imec, a research center located in Leuven, announced the collaboration with significant automakers to create novel automobile modular chips. The goal of this program is to transform the way cars are constructed because they are becoming more and more dependent on computational power.

September 2024

Toshiba declared that it would start sampling a new responder interface integrated circuit (IC) for automotive applications that is designed for CXPI. The drive for automotive systems to be smarter, lighter, and more responsive is met by standards such as the Clock Extension Peripheral Interface (CXPI).

January 2024

Higher levels of autonomy are made possible by Texas Instruments' AWR2544 77GHz millimeter-wave radar sensor chip, which enhances sensor fusion and ADAS decision-making.

Growth of Electronic Vehicles

The automotive chip market is fast expanding due to electric vehicles (EVs) converging to increase with developments centered around connectivity, electrification, and automation. Electrification of vehicles is basically driven by vehicle demand and is also subsequently propelling chip requirement. Key players such as Tesla and Volkswagen are known to depend on advanced chips which allow them with the efficacy algorithm for better performance. Infineon Technologies, among other semiconductor manufacturers, introduces specialized chips meant to help optimize EV systems.

Integration of Advanced Driver-Assistance Systems (ADAS)

Demand for high-performance automotive chips is growing in the market due to the deployment of ADAS. With huge investments in ADAS by automakers like Mercedes-Benz and BMW, chip makers like NVIDIA and Intel are developing strong chips to process real-time data and integrate sensors. Such chips ensure safety, efficiency, and scalability for self-driving automobiles and semi-autonomous features.

Growing Demands for Vehicle Connectivity and Infotainment

Rising demand for connected and smart vehicles creates demand for the chips powering infotainment, navigation, and communication systems, thereby boosting the growth of the automotive chip market. Qualcomm and Broadcom are suppliers of chips for in-vehicle connectivity, voice recognition, 5G connectivity, and flawless integration of smartphones. Automakers and suppliers are bottling up their innovation lines to fulfill customer demands for superior connectivity experience.

Chip Shortages and Supply Chain Resilience

As per the automotive chip market analysis, the automotive industry has been threatened by slowdowns and disruptions in manufacturing plants and vehicle production due to persistent shortages of semiconductors. In order to guarantee a consistent supply of chips, automakers have responded by establishing lasting alliances with semiconductor firms. To reduce interruptions and improve manufacturing continuity, companies like Toyota and GM have made investments in fortifying their supply chains and negotiating long-term chip contracts with companies like TSMC and Samsung.

Automotive Chip Market Opportunities

With 5G connectivity gaining momentum, automotive semiconductor chip market companies can develop high-performing chips to establish more reliable communication with vehicles, infrastructure, and IoT devices. This will function as a launchpad for innovations in autonomous driving, real-time data exchange, and varied in-car comportment. Qualcomm is one of the companies that has invested in research and development activities for chips that will meet the high-speed demands of connected vehicles. Moreover, as cars grow more connected, cybersecurity becomes a major concern. Companies that make automotive chips can capitalize on this by developing safe chips that guard against data leaks and cyberattacks. Businesses can satisfy the increasing need for safe automotive systems by directly integrating encryption and certain security features into chipsets.

Automotive Chip Market Trends

The cutting-edge automotive chips demand has increased along with the exponential expansion of autonomous driving technology. These electronics enable real-time decision-making in automobiles by processing data from several sensors, cameras, and radar systems. The need for high-performance semiconductors that enable automated driving and increased vehicle safety is being driven by the growing global trend toward self-driving cars, which is being spearheaded by firms like Waymo and Tesla. In addition, the need for automotive chips is being driven by the growth of smart mobility solutions and sustainable transportation. As the electric and hybrid vehicle segments grow, technology to optimize energy efficiency, battery performance, and vehicle management systems is increasingly getting improved, thereby fueling further semiconductor demand for EVs and connected vehicles.

Automotive Chip Market Restraints

• Global supply shortages of semiconductors are continuing due to supply-chain disruptions; they have severely affected automotive production, leading to delays, increasing costs, and letting vehicles become far less available. This factor poses a significant challenge to the automotive chip market growth.
• The increased expenses linked to the development of sophisticated automotive processors, especially for autonomous driving and electric vehicles, restrict smaller manufacturers' and stakeholders' access to the market and drive up the cost of all automobiles.

Automotive Chip Industry Segmentation

The report titled “Automotive Chip Market Report and Forecast 2025-2034” offers a detailed analysis of the market based on the following segments:

Market Breakup by Type

• Analog ICs
• Microcontrollers and Microprocessors
• Logic ICs

Market Breakup by Vehicle Type

• Commercial
• Passenger

Market Breakup by Application

• Chassis
• Powertrain
• Safety
• Telematics and Infotainment
• Body Electronics

Market Breakup by Region

• North America
• Europe
• Asia Pacific
• Latin America
• Middle East and Africa

Automotive Chip Market Share

Market Insights by Type

The importance of analog integrated circuits (ICs), microcontrollers, microprocessors, and logic ICs in contemporary car systems is driving their growth in the overall automotive chip market dynamics. Power management, interface sensors, and battery management are all essential for electric vehicles. These are developed by analog integrated circuits. Microcontrollers and microprocessors are also crucial for managing ADAS, infotainment, and engine control, among other automotive activities. Integrated circuits (ICs) handle data for communication in automobiles, improving connectivity, performance, and the capacity for making decisions in real time. These chips further guarantee improved vehicle safety and user experience, and their demand is rising in tandem with the growing need for connected and driverless automobiles.

Market Analysis by Vehicle Type

Modern chip designs are being increasingly adopted by commercial cars for uses including as telematics, fleet management, and enhanced driver safety systems, thereby accelerating the automotive chip market revenues. As logistics and transport companies focus on efficiency, optimization of fuel consumption, vehicle diagnostics, and autonomous driving features with chips have become an interconnected function in more appealing products. The steadily rising trend toward electric vehicles, autonomous technologies, and in-car entertainment systems, along with the corresponding surge in demand for modern automotive chip solutions are driving the passenger vehicles segment. This particular segment is expected to grow at a CAGR of 13.2% over the forecast period.

Analysis by Application

The growing demand for efficiency, safety, and connectivity in automobiles is driving the automotive chip consumption through a variety of applications, including chassis, powertrain, safety, telematics, entertainment, and body electronics. Advanced chips are used in chassis and powertrain systems, particularly in electric vehicles, for control, energy management, and optimization. Additionally, the quest for the development of chips in safety applications is boosted by ADAS and autonomous driving features. High-end performance chips are sought for telematics and infotainment systems to provide connectivity, navigation, and user interfaces. Body electronics comprising lighting and climate control fuels the market further by augmenting vehicle functionality.

Automotive Chip Market Regional Analysis

North America Automotive Chip Market Opportunities

The growing popularity of EVs and autonomous driving technology is pushing up demand for automotive chips in North America. The regional market is expected to grow at a CAGR of 11.5% over the forecast period. Advanced processors for EVs, safety systems, and in-car networking are being developed by United States manufacturers like Tesla and Ford, which is fueling regional innovation and chip demand.

Europe Automotive Chip Market Insights

With the increasing shift towards green technology and stringent vehicle pollution rules, the Europe automotive chip market is seeing strong demand. High-performance processors are in great demand as a result of the European market's orientation towards autonomous driving technologies and the significant investments made by automakers like BMW and Volkswagen in the development of advanced driver assistance systems (ADAS) technology.

Asia Pacific Automotive Chip Market Growth

The growth of the Asia Pacific automotive chip market is supported by countries like China and Japan. These countries have led in the production of automotive chips and made the region the largest vehicle-producing hub powered by the surge in electric vehicle adoption. Moreover, the rising automotive manufacturing base in countries like South Korea and India supports the increasing demand for chips in smart-connected vehicles.

CAGR 2025-2034 - Market by

• Country
• Canada
• 12.4%
• UK
• 11.4%
• India
• 11.2%
• China
• 10.9%
• France
• 10.7%
• USA
• Germany
• Italy
• Japan
• Australia
• Brazil
• 10.2%
• Mexico
• Saudi Arabia
• 9.8%

Latin America Automotive Chip Market Outlook

The rise in vehicle production and modernization occurring in nations like Brazil is the reason behind the growing demand for automotive chips in Latin America. Urban markets' increased use of ADAS technology and linked cars is contributing to the region's rising demand for automotive semiconductors, which is driving further market expansion.

Middle East and Africa Automotive Chip Market Dynamics

The Middle East and Africa, including the United Arab Emirates and South Africa, are experiencing fast infrastructural development, which is driving up the automotive chips demand. The region's need for cutting-edge automotive semiconductors is being driven by the rise in luxury, electric, and connected automobiles as well as increased safety awareness.

Competitive Landscape

The automotive chip market players seek to enhance vehicle performance through the use of cutting-edge semiconductors, with a primary emphasis on in-car infotainment, connection, autonomous driving, and energy economy. In order to meet the increasing demands of consumers for safety, efficiency, and innovation, most of the automotive chip companies are also investing in scalable and secure solutions for electric and smart vehicles.

Qualcomm Technologies, Inc.

Qualcomm Technologies, Inc. is a leading automotive chip manufacturer with a wide range of connectivity, artificial intelligence, and 5G technologies. The company was founded in 1985 and has its headquarters in California, USA. They supply semiconductors for ADAS, infotainment systems, and driverless cars, which contribute to increased performance and safety.

Renesas Electronics Corporation

Renesas was established in 2002, and the company provides System-on-Chip (SoC) solutions and automotive microcontrollers. Global automakers can innovate in electric and autonomous vehicle technologies thanks to the company's chips for powertrains, safety systems, and ADAS solutions.

Infineon Technologies AG

Powertrain, safety, and energy-efficient solutions are provided by Infineon Technologies, a company in the automotive semiconductors industry that was founded in 1999 and has its headquarters in Germany. Their chip line is used in battery control, ADAS, and EV management systems, contributing to the shift to smart cars and sustainable mobility.

STMicroelectronics NV

STMicroelectronics NV, founded in 1987, is one of the supply leaders in chipsets used for infotainment, power management, and ADAS applications. Their solutions enable connectivity and energy efficiency to improve upon the automotive domain advancements toward electric, autonomous, and connected vehicles on a global scale.

Other key players in the automotive chip market report are Texas Instruments Incorporated, Broadcom Inc., NXP Semiconductors NV, Micron Technology, Inc., Intel Corp., and Rohm Co. Ltd., among others.

Startup Scenario in the Automotive Chip Market

High-performance semiconductors for advanced driver-assistance systems (ADAS), electric automobiles, and autonomous driving are being increasingly developed by new market entrants. In order to satisfy expanding consumer and business demands, they are developing energy-efficient processors, real-time data processing solutions, and improved vehicle communication through 5G and AI integration.

Silicon Mobility

Founded in 2015, Silicon Mobility manufactures embedded system-on-chips for use in automobiles. It creates and develops real-time, flexible semiconductor solutions for embedded systems, including those used in railroads, automobiles, airplanes, and drones. For systems control applications in IC engines, chassis, electric motors, transmissions, and ADAS applications, the business offers platform SoC solutions with embedded software.