The recent severe shortage of MLCCs, resistors, and MOSFETs has been creating supply chain challenges for global OEMs and EMS companies. The increasing demand from the automotive market is one of the common reasons for this across-the-board shortage in the electronic components market.
Just two years ago, the automotive electronics market was around $34 billion, representing less than 10% of the total semiconductor market worldwide. The recent technology development and emerging market trends have made automotive the fastest growing domain in the semiconductor market for the next 5 years. Radiant Insights expects the automotive electronics market to reach $275 billion by 2020, growing at a CAGR (compound annual growth rate) of over 8% from 2014 to 2020.
According to KPMG’s global automotive executive survey, 35% of global consumers would buy a full hybrid electric vehicle (FHEV) as their next car. Meanwhile, 53% of investors are planning to heavily invest in FHEV powertrain technology. In China, the world’s largest automobile market, 50% of consumers would prefer an FHEV as their next car. Compared to traditional internal combustion engine vehicle (ICE), the value of semiconductor in an electronic vehicle is anticipated to grow 15 times and most of the increase is coming from power semiconductor in the powertrain system. With consumers’ increasing demand for electronic vehicles (EV) resulting in a demand surge for semiconductors within EVs, the automotive electronics market will see a remarkable rise over the next 5 to 10 years.
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The powertrain of an EV mainly consists of IGBT module (insulated-gate bipolar transistor), Gate driver IC, DC link capacitor, EMC filter, inductors, transformers and MLCCs. For example, FS400R07A3E3, 1ED020I12FA2, B25655P4607, P100316-P001, B82721A2402N020, B78307A2276A003 and CGA6P3X7S1H106K250AE are major components being used in the powertrain of an EV.
In addition to the powertrain, adoption of advanced driver assistance systems (ADAS) is another domain that is driving the increase in automotive electronics. In 2015, ADAS was the smallest domain in the power semiconductor market, only accounting for 5% of market share. However, as the demand for more sophisticated ADAS system rose, this group is forecasted to see CAGR of 16% from 2015 to 2022.
There are four major modules in the ADAS: sensing, processing, intelligence generation and decision making. Within each module, multiple electronic components are required to support each function. For example, an ADAS-enabled vehicle will carry multiple sensors including a long-range radar, mid-range radar front and back, night vision camera, video camera, ultrasound and reserves camera to collect surrounding information. That information will be converted into electrical parameters such as voltage, resistance and current for a central processor to provide situational analysis and creates a series of possible actions and reactions. Finally, the actuation system will execute these actions and reactions through the driver.
Take the blind spot detection system, a relatively new and increasingly popular function, as an example. A teardown of the blind spot monitor system reveals major components used in the system: 24GHz Radar Blind Spot Detection Sensor, ST Micro 24GHz Transceiver, Analog Devices AD8284 Radar Receive Path Analog Front End and Freescale SPC5671LVVZ1 32-Bit MCU.
Compared with consumer electronics, the automotive electronics must be able to handle a wider temperature range, last a long time, tolerate a wider humidity range and have a 0% failure rate. It is expected that a fully autonomous driving vehicle will have up to 7,000 chips. Even the low failure rate of 1 parts per million would expose 7 out of 1000 cars with a safety risk. A defective MLCC or resistor in a car could cause fatal damage on the road. To achieve such quality standard, great effort and resources need to be considered. Therefore, only the major OCMs with a long history and strong resources can supply automotive-grade electronics. The enormous growth potential and the high margin of this segment have driven many OCMs to shift their production capacity from regular electronics to auto-graded electronics. This structural change on the supply side is the main cause for the current shortage market in other areas.
Supporting the supply needs of significant sectors such as automotive, is a substantial task that requires extensive expertise and experience which must be taken extremely crucial by a components supplier. Advanced MP Technology has been supporting OEM and EMS companies in various high-reliability verticals, including the automotive industry, for over 40 years with its strong supply network and high-quality standards. By utilizing our state-of-art quality system, we can provide the best suitable services to our customers across different verticals.
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