Samsung to focus on car chips growth to withstand a slump in demand

[Source : Samsung Semiconductor]

Samsung Electronics Co. is focusing on vehicle semiconductors with the goal of becoming a top player by 2025, a move to offset a slump memory chip business with fast-growing demand in the automotive industry, according to sources on Tuesday.

The Korean memory chip giant is the industry leader in global DRAM and NAND markets but is lagging behind U.S. Micron Technology Inc. in automotive semiconductors.

In the automotive semiconductor market, demand is exploding as cars evolve into “smartphones on wheels.” Internal combustion engine cars require an average of 200 to 300 semiconductors, but self-driving cars require more than 2,000 since semiconductors are used to drive all functions of vehicles, such as infotainment, advanced driver assistance systems, cameras and sensors.

Samsung Electronics expects level 5 fully autonomous vehicles that do not require driver intervention to require about 300 gigabytes of DRAM capacity, 50 times the previous capacity, and 5 terabytes for NAND, an increase of about 32 times.

According to IHS Markit, the automotive semiconductor market was worth $45 billion at the beginning of this year and is expected to grow to $110 billion by 2030. The annual growth rate is high at about 9 percent. The outlook for the market next year remains bright despite the overall decline in demand in the semiconductor industry.

Despite the economic downturn, the automotive semiconductor industry can grow to $67 billion next year, up 15.5 percent from 2022, thanks to increased demand for autonomous driving and electrification, said Noh Geun-chang, Hyundai Motor Securities’ research head.

The growth curve is particularly steep in the memory chips market for vehicles, where Samsung Electronics is competitive. For example, graphic DRAM is essential for vehicle infotainment, which is on path of expansion in function and capacity in the era of self-driving cars, and Samsung Electronics is the leader in this sector. Last month, the company developed graphic memory GDDR6W by using its advanced packaging technology. It is also focusing on automotive system chips such as Exynos Auto.