Automotive IC prices surge in the year 2021 because of tight supply and rebounding market demand

The market for automotive micro-controllers has been on big change in the past several years. It climbed up to 12% in the year 2017, then it just rose just 1% in the year 2018, and it stopped its rise because of the stalled market demand for new vehicles. The covid-19 pandemic in the year 2020 hit the market of automotive micro-controllers greatly.

After the worst summer of 2020 downturn driven by corona virus, the market demand for automotive micro-controllers was hot again at the end of the year 2020.There is a huge shortage of MCUs and other semiconductors facing the rebound-driven upturn. Automotive MCU sales is expected to rise 23% in the economic recovery of 2021 to  to a record-high level of $7.6 billion, and it might climb up to 14$ in the year 2022 and 16% in the year 2023.

In the first half of the year 2021, wafer fabs production had been to be shut down because of massive power outrages in Texas USA during a historic arctic cold wave in February ,a few wafer processing plants had to closed because of heavy damage by fire in Japan.Recently, Automotive IC makers say they are increasing their automotive MCU production. For example, foundry manufacturer Taiwan Semiconductor Manufacturing Co. Ltd (TSMC) says that it will increase its wafer fab capacity by 60% in the third quarter of the year 2021 compared with that in the same period of the year 2020 and 30% higher than the pre-pandemic level.
 
It is estimated that the revenue for 32-bit automotive micro-controller designs will be about $5.8 billion this year, about $1.3 billion for 16-bit automotive MCU and about $441 million for 8-bit automotive MCU in the year 2021. The averagely higher selling prices are making the sales volume higher this year because of shortage of supplies in the market.Automotive entertainment and information systems is expected to take about 10% automotive MCU sales in the year 2021 while micro-controllers used in the other parts of vehicles are estimated to take 90% of the revenues this year. According to IC insights survey, the MCU sales for Automotive entertainment and information systems is estimated to rise 59% in the year 2021, and the rest of automotive MCU revenues are expected to rise 20% compared with that in the year 2020.