- The rising automobile production is driving the adoption of semiconductors
- Semiconductor foundry has two model types- pure-play foundry and integrated device manufacturer (IDM)
The global semiconductor foundry market worth was USD 88.92 Billion in 2022 and is projected to attain a market size of USD 93.51 Billion in 2023. Also, the market is anticipated to reach over USD 161.90 Billion by 2031, growing at a CAGR of 7.10%, says a report by Consegic Business Intelligence.
A factory that makes wafers is known as a Semiconductor foundry. It has two model types: pure-play foundry and integrated device manufacturer (IDM). Pure-play semiconductor foundry focuses on producing integrated circuits (IC) for other companies without in-house design capabilities. Second, IDM is responsible for designing, manufacturing, and selling IC products.
There are several reasons behind the growth of the semiconductor industry. The massive demand for semiconductors from multiple sectors, including automotive, aerospace & defence, healthcare, consumer electronics, telecommunication, and others, has made it possible.
The automotive industry has become the primary reason for this growth. Semiconductor adoption surges due to expanded auto manufacturing, higher production, and demand for advanced driver assistance systems, reinforcing the importance of efficient sensor solutions.
According to the International Organization of Motor Vehicle Manufacturers, the overall passenger car production in Germany reached 3.5 million in 2022, depicting a growth of 12.9% in comparison to 2021. Thus, the rising automobile production is driving the adoption of semiconductors for application in automobile ADAS and infotainment systems, thereby driving the market’s growth.
The government has played a tremendous role in adopting electric vehicles, which automatically increases the demand in the semiconductor foundry market.
Semiconductors are pivotal in electric vehicles, aiding battery development, advanced driver assistance, and efficient power management. Stringent manufacturing standards and regulations, though, impede the market growth.