Insight

Growth in automotive semiconductors outpace expectations

With accelerating adoption of EVs and other changes in auto design, the automotive semiconductor market could exceed $250 billion in 2040.

Gary Silberg

Gary Silberg

Partner, Global Automotive Sector Leader, KPMG US

+1 312-665-1916

Lincoln Clark

Lincoln Clark

Partner, Audit, KPMG US

+1 408-367-4914

Irene Signorino

Irene Signorino

Director Advisory, Strategy, KPMG US

+1 213-955-8651

In our 2019 paper Automotive semiconductors: the new ICE age, we described the opportunities and challenges for the automotive semiconductor business and predicted the market would reach $200 billion by 2040. With electrification, autonomy, and other mega trends in the automotive industry, we noted that motor vehicles were becoming computers on wheels, making automotive one of the fastest-growing segments in the semiconductor industry. 2021 turned out to be a record year both for the semiconductor industry as a whole and for the automotive semiconductor segment, despite unprecedented supply-chain challenges and shortages affecting everything from autos to refrigerators. Given these developments, we now predict the automotive segment will reach$200 billion sooner and surpass $250 billion by 2040.