Dennis Laudick, vice president of Arm's automotive go-to-market strategy, said support for electric vehicles, Advanced Driver Assistance Systems; Automotive electronics, such as ADAS and in-car entertainment, are growing faster than other sectors such as smartphones and data centers.
Indeed, Arm's auto-related revenues have more than doubled since 2020. That's because Hyundai needs more chips in its cars and is one of the few chip markets that will run short because of strong demand. Total revenue rose 35 percent to 2.7 billion pounds in 2022, and revenue at Arm's automotive division has grown fivefold over the past four years.
Arm now accounts for 85 percent of the global in-car entertainment electronics market and 55 percent of the ADAS market, Laudick said. The world's top 15 automotive chip makers, including Nvidia, STMicroelectronics and Renesas, all use ARM-based IC designs.
According to S&P Global Mobility, the average semiconductor cost per vehicle will increase from $700 in 2020 to $1,138 in 2028.
Notably, Japanese auto giant Honda announced in December 2022 that it would continue to cut production at a plant in Japan by 20% through early January 2023 due to a chip shortage.
The Nikkei Asian Review reported on Thursday that a survey conducted by Japan's Distributors Association of Semiconductors & Components in December 2022 showed that those claiming excess supply outnumber those claiming shortages by 64 basis points. That is 38 basis points higher than the previous survey in September. The exception, however, is chips for cars, which could be in short supply throughout 2023.
While demand for automotive electronics is rising, analysts believe shortages of power semiconductors, which control electric currents, and analog ics, which manage power supplies, will continue through 2023. According to Sourcengine, a U.S. chip supplier, the lead time for power semiconductors has increased from 31 to 51 weeks at the end of May to 39 to 64 weeks as of November 2022.
