Market Trends of Power Semiconductor Industry
Automotive Industry to be the Fastest Growing End User
- Analyzing power semiconductors in the automotive segment includes ADAS for adaptive cruise control, lane assistance, collision avoidance, infotainment systems for smooth music playback and accurate GPS functionality, telematics and connected vehicles, and others. Furthermore, they are also used in electric vehicles to coordinate the operations of electric motors.
- Automotive is one of the emerging sectors of the power semiconductors market and is estimated to have a significant share with the increase in the adoption of autonomous vehicles, EVs, and HEVs.
- Power electronics is widely utilized in automotive electrical and electronic systems to enhance fuel efficiency and address thermal concerns. This is achieved by implementing components like silicon-based power MOSFETs and IGBTs, which serve as power electronic switches in the power train system. By employing these technologies, the system's overall size can be reduced while utilizing high power in the kilowatt range.
- Moreover, the Insulated Gate Bipolar Transistor (IGBT) has emerged as an essential component in the development of electric vehicles. In the upcoming years, it is anticipated that the demand for IGBTs will rise significantly due to the rise in EV sales. For instance, according to a recent report from the International Energy Agency, electric car markets experienced robust growth, with sales approaching 14 million in 2023. The market share of electric vehicles surged from approximately 4% in 2020 to 18% by 2023, indicating a significant shift in consumer preferences toward more sustainable transportation options.
- Electric vehicle sales are poised for robust growth through 2024. In the first quarter alone, global sales of electric cars surpassed 3 million, marking a 25% surge compared to 2023. Forecasts suggest a total of approximately 17 million electric vehicles will be sold by the close of 2024, indicating a notable 20%+ year-on-year uptick, with a significant acceleration in new purchases anticipated in the latter half of this year. This surge is largely attributed to a combination of national policies, incentives, and intensifying price competition, all working in tandem to bolster sales and drive the market forward.
Understand The Key Trends Shaping This Market
Download PDF
China to Witness Major Growth
- Power semiconductors are increasingly prevalent in EVs, as these vehicles demand high-power energy for their electric motors. Components like MOSFETs and IGBT serve as power electronic switches in the vehicles' power train systems. The market's notable growth is fueled by the escalating demand for energy-efficient hybrid electric vehicles, particularly in nations like China, as they combat the effects of mounting environmental pollution.
- Notably, China stands as the world's premier vehicle market, boasting the highest annual sales and manufacturing output. By 2025, the nation is expected to be on track to achieve a significant milestone, with an estimated 35 million vehicles slated for domestic production.
- Looking ahead, as China aims for carbon neutrality by 2060, the government's initiatives are set to bolster the demand for power electronics. This push aligns with the broader market expansion, especially in the electric vehicle segment. China's Development Plan for the New Energy Automobile Industry (2021-2035) projects that EVs could capture a 25% market share by 2025. Consequently, China is intensifying efforts to incentivize EV purchases, a move expected to further propel the development and adoption of power electronics in the EV landscape.
- In collaboration with its government, China made substantial progress in expanding its 5G network nationwide. The country's major telecom operators, China Mobile, China Unicom, and China Telecom, led the construction of robust 5G infrastructure in urban centers and key regions. This initiative enabled millions of users to access high-speed, reliable internet services across China. The deployment of base stations has now reached a critical stage.
- By the end of 2023, the number of 5G base stations in China amounted to 3.38 million. With extensive infrastructure investments and ambitious rollout plans, China has achieved significant 5G coverage. According to forecasts, the number of base stations is projected to reach over six million by 2024.
Get Analysis on Important Geographic Markets
Download PDF
