How Does Semiconductor in Automobiles Transform the Automotive Industry?

With the automotive landscape shooting for more reliable and efficient cars, the utilization of the semiconductor in automobiles proves to be a groundbreaking initiative.

Updated 19 April 2024

Ashish Chauhan
Ashish Chauhan

Global Delivery Head at Appventurez

The last few years have been a transformative ride for the automotive industry. The ever-rising advancements in technological trends have given rise to the rapid development of smart vehicles. One such innovation that has profoundly impacted and revolutionized the automobile industry is the incorporation of semiconductor technology.

Today, advanced vehicles are integrated with various sensors, such as smart cameras and improved lidars. These sensors are empowered with robust semiconductor chips to maximize the efficiency of automobiles. However, integrating a semiconductor chip in cars is tricky. One needs professional automotive software development services to utilize its full potential.

Automobile semiconductors have replaced conventional ignition systems with electrical ones, enhancing power management and fuel combustion efficiency. To understand their role better, this article will discuss how semiconductor in automobiles can transform the landscape of automotive businesses.

An Overview of Automotive Semiconductor Market

With the ever-rising inception of numerous technologies in the automotive sector, the entire market has been significantly disrupted in the past few years. 3D map applications, electric vehicles, and automobile automation have been the key tech trends in the automotive sector.

All these have boosted the growth and utilization of a well-structured semiconductor in automobiles. Consequently, the automotive semiconductor market witnessed a clear spike, with the figures anticipated to surpass the $60 billion mark by the end of 2024.

semiconductors in automotive industry

Some of the major reasons and growth factors responsible for this increased usage of automotive semiconductors are:

  • Increased automobile manufacturing and purchases
  • Rising implementation of innovative technologies
  • High demand for hybrid and electric vehicles
  • Shifting focus on connected vehicles with advanced driver assistance systems
  • A rapid increase in demand for comfort, safety, and seamless driving experience

How Do Semiconductors Work in Automobiles?

The role of semiconductor in automobiles is imperative, serving a diverse range of functions, especially for modern cars and EVs. There are several components of semiconductors that come along to make the whole segment work. Below is a brief description of these components that help you understand how semiconductors work.

Key ComponentsKey Functions
MicrocontrollersIntegrated circuits comprising memory, CPU, and a diverse range of peripheral interfaces. Used for controlling and tracking functions, such as engine management, infotainment systems, body control, etc.
Digital Signal ProcessorsMicroprocessors engineered for performing tasks related to digital signal processing. Used for speech recognition, image processing, audio processing, and other heavy computational activities.
App-Specific ICsPersonalized integrated circuits developed for specific automotive functions. Used for high-performance functions and integration capabilities in vehicle control systems, ADAS algorithms, and image processing.
Electric Control UnitsECUs enable real-time monitoring. Used for precise controlling and combining multiple vehicular systems, such as microcontrollers, sensor interfaces, and communication protocols, enhancing the performance and safety of vehicles.
Power Management ICsThis component of a semiconductor in automobiles ensures a controlled and managed vehicle power supply. Used for effective power distribution, protecting automotive systems, and regulating voltage.
SensorsAs one of the crucial components of a semiconductor in cars, automotive sensors collect information from a vehicle’s internal system and outer surroundings. They range from position sensors, proximity sensors, temperature sensors, and pressure sensors to accelerometers and gyroscopes. Used in environmental control systems, engine management, and ADAS.
MEMSMicro-electro-mechanical systems-based semiconductors offer high-grade actuation along with sensing capabilities. Used for augmenting the safety, accessibility, performance, and driving experience of the vehicles.

All these components of a semiconductor in automobiles function together, ensuring top-notch performance of vehicles along with improved functionalities.

Advantages of Semiconductor in Automobile

The usage of semiconductors in automotive industry has several benefits, especially when it comes to e-vehicles and driverless cars. Below are some of the notable benefits of semiconductors in the automotive landscape.

advantages of semiconductor

Enhanced Connectivity

In-vehicle GPS features, such as mapping road closures and optimal routes have made our lives easier as drivers. However, these features require the integration of high-grade semiconductor in automobiles, modifying the pre-installed systems equipped in them.

Besides this, the semiconductor used in cars helps process and analyze data, leading to accuracy and time-effectiveness while controlling the vehicle.

Improved Safety

With the implementation of AI in self-driving cars and other autonomous vehicles, the safety systems have been significantly improved. The emergency braking systems, parking assistance, and blind spot detection are some of the notable features — thanks to the power of semiconductor technology.

semiconductor in cars

Advanced Driving Assistance

A plethora of advanced features, such as GPS navigation based on voice UI design, active automated steering, cruise control, etc. help drivers to ride seamlessly. All these features are powered by semiconductor in automobiles, as it forms a bridge between software solutions and vehicular functionalities.

Electrification of Vehicles

Electrification is one of the emerging tech trends in the automotive industry, upturning the performance of both electric and hybrid vehicles. It manages the battery of the vehicles and enhances their fuel combustion efficiency. Besides, it also helps restore energy in EVs with the help of regenerative braking systems. Semiconductor technology in automobiles can significantly streamline all these processes.

Extended EV Range

One of the notable benefits of semiconductor in automobiles is their ability to turn on and off multiple times per second. This process significantly reduces power losses, making batteries last longer with an extended EV range. Apart from this, semiconductor used in cars can also assist automotive OEMs in using portable batteries. This enables them to design improved car architectures with reduced space consumption. 

What is the Use of Semiconductor Chips in Cars?

Semiconductor chips in cars are strategically placed and utilized to perform an extensive set of functions. This includes:

semiconductor in automobile

Engine Control Units (ECUs)

Modern vehicles are equipped with multiple advanced ECUs. Each of these units is responsible for tracking and managing various aspects of the engine’s performance. The role of semiconductor chips here is to:

  • Analyze sensor data
  • Optimize ignition timing
  • Control motors
  • Manage emissions

Infotainment Systems

When it comes to modern driving experience, infotainment systems hold a crucial place in vehicles. By using semiconductor in automobiles, manufacturers empower these systems and enable features such as in-vehicle audio, smartphone connectivity, and GPS navigation. Apart from this, the semiconductor chips also help in:

  • Switching regulators
  • Enabling touchscreen displays

Suspension and Transmission Control

Semiconductor chip in cars are also used in suspension and transmission systems, helping the vehicle to adjust its performance based on driving conditions. The role of semiconductor chips here includes:

  • Delivering seamless handling
  • Optimizing gear shifts
  • Maintaining various sensors, such as speed and direction, linear, etc.

Safety Systems

Today’s modern vehicles, both autonomous and manual, are equipped with robust safety systems powered by advanced semiconductor chips. Some of the major advantages of semiconductor chips in terms of vehicle safety are:

  • Increased stability control
  • Enhanced anti-braking locking systems
  • Airbag deployment

Climate Control

Semiconductor technology and state-of-the-art chips also benefit in controlling the climate and temperature systems in cars. Here’s how semiconductor in automobiles enhance climate control systems:

  • Regulating temperature
  • Maintaining air distribution
  • Adjusting the vehicle’s fan’s speed

Technology Trends Associated with Semiconductor in Automobiles

The automotive semiconductor market is transforming at a rapid pace, and emerging tech trends are significantly responsible for it. From electric vehicle software development to smart automotive technology, several trends are reshaping the industry. Let’s take an overview of the prominent ones.

automotive semiconductor

V2X Communication

Vehicle-to-Everything, or V2X technology allows vehicles to interact with their surroundings, making driving seamless and secure. The primary role of this tech trend is to inform drivers of what’s ahead, especially when the driver has zero visibility about upcoming obstacles or corners within a mile. Using semiconductor in automobiles ensures better communication in real-time.

Ultra-Wideband Technology

Ultra-widebands (or UWBs) offer accurate, secure, and real-time localization powered by wireless technologies like Bluetooth, Wi-Fi, and GPS. Semiconductors help in generating automotive UWB ICs, enabling the connection between the vehicle and smartphones.

In-Vehicle AI Systems

Semiconductor in automobile also provides support for integrating in-vehicle AI-powered systems to improve and cater to human actions. This technology is specifically crucial for driverless vehicles like Tesla where inferring actions depending on in-car and outside environmental sensors is crucial. Morris Garages and Tesla are some of the notable automotive brands that have equipped AI as a service for a better driving experience.

5G and 6G Connectivity

Modern vehicles are required to equip and connect with a robust automotive infrastructure for data sharing. For this, stable and fast network connectivity becomes essential. That’s why major automotive OEMs and semiconductor chip makers incorporate 5G and 6G connection support into their vehicular systems for enhanced connectivity.

Prediction-Based Analytics

Another prevalent and useful tech trend in the domain of semiconductors is prediction-based analytics. To expand the sphere of automotive semiconductor use cases, automotive companies have started deploying semiconductor chips in cars that offer predictive analysis. The impact of predictive data analytics in the automotive sector is significant, assisting drivers to ride safely in high traffic-intensive situations.

How Many Semiconductor Chips in a Car Should Be Used for Better Automobile Efficiency?

The number of semiconductor chips to be used in a car depends on several factors, such as:

  • Make and model of the car
  • Type of car — electric or gas-powered
  • Integrated features
  • Manufacturing year

Evaluation of these factors will help you understand how many semiconductors in a car must be used for optimal performance. On average, a modern vehicle is incorporated with almost 1,000 to 3,000 semiconductor chips.

How Can Appventurez Help You with Integrating Semiconductor Capabilities into Automobiles?

As a professional automotive software and EV solutions provider, Appventurez leverages the power of semiconductor technology backed with software complexities to build a robust automobile architecture.

Our automotive software engineers hold profound expertise in developing data-intensive and goal-oriented strategies, ensuring the best use of semiconductor in automobiles. Besides building an innovative software solution, our experts also provide insightful guidance and consulting services to leverage the capabilities of semiconductor in cars.

Have an ingenious project in mind and want to collaborate with a professional software development company for the same? Well, our team will be more than happy to assist you. Consult us and drive to the future fueled by the wheels of technological excellence.

software development services


Q. What are semiconductor chips used for in cars?

In hybrid or electric vehicles, semiconductor chips help manage battery systems, control power, distribute power, manage engines, and ensure safety management.

Q. How are semiconductors used in automobiles?

From safety management to electrification of vehicles, semiconductors are used in many ways in automobiles. Apart from this, semiconductor in automobiles also ensure engine management and improved connectivity.

Q. Is there a semiconductor shortage in the automobile industry?

Earlier, the shortage in semiconductors forced automotive businesses to take a step back in terms of production. However, since 2023, the supply of semiconductor chips has been on the up, indicating that it’s no longer a challenge.

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    Ashish Chauhan
    Ashish Chauhan

    Global Delivery Head at Appventurez

    Ashish governs the process of software delivery operations. He ensures the end product attains the highest remarks in qualitative analysis and is streamlined to the clientele’s objectives. He has over a decade of experience as an iOS developer and teams mentorship.