Automotive Power Electronics Market Expected to Reach $8.1 Billion by 2032

According to a new report published by Allied Market Research, titled, “Automotive Power Electronics Market," The automotive power electronics market was valued at $5 billion in 2022, and is estimated to reach $8.1 billion by 2032, growing at a CAGR of 5.1% from 2023 to 2032.

Automotive power electronics is a part of electrical and electronic systems used in automobiles for controlling, converting, and distributing electrical power supply within a vehicle. Application of power electronic component used in a vehicle ensures effective transfer of electric energy to all the necessary components of an automobile along with ensuring that all the associated components are operating in an efficient manner. In addition, with the introduction of suitable power electronics to be used in vehicles, the demand for smarter & efficient automotive components has increased which has created a wider scope for the growth of the market across the globe. In addition, automotive components such as semiconductors, ICs, safety components & others operate on power electronics which also proves to be a factor supplementing the growth of the automotive power electronics market across the globe.

Power electronics includes the structure, and implementation of numerous electronic components and systems, such as AC/DC converters, inverters, vehicle motors, vehicle battery management systems, and other electrical control units, which finds an increased application of power electronics. The power electronic system used in vehicle helps in optimizing the performance of the vehicle trough proper battery management & consumption along with ensuring efficient electric propulsion & at the same time maintaining proper vehicle safety.

With the advancement in technology, the global automotive industry has experiences an increased support for developing effective automotive components. This has enabled numerous companies to develop & offer components to be used in automotive industry thus supplementing the growth of the market across the globe. Nations heavily reliant on crude oil imports, which represent a substantial portion of their expenditures, are now observing a remarkable surge in the adoption of electric vehicles. Moreover, electric vehicles utilize electricity as a cleaner energy source, making them an attractive and sustainable transportation solution for countries grappling with both dependence on imported crude oil and the challenges posed by escalating carbon emissions. Owning to the rising demands of electric vehicles, key market players are expanding their business presence to meet these demands. For instance, in February 2023, Infineon Technologies AG announced that it was starting the construction of its new plant in Dresden, Germany. The plant specialized in the manufacturing of analog/mixed-signal technologies and power semiconductors. Furthermore, the plant was to begin production by 2026. This allowed Infineon to strengthen their capabilities and product presence in the automotive power electronics market size.   

In addition, the rising adoption of electric vehicles necessities the requirement of charging infrastructure, the development of which is also on a rise. For instance, in 2023, Tata Power, one of India’s’ largest EV charging solutions provider announced their plans to install around 25,000 new EV charging points across the nation in the next 5 years. Such instances, are expected to result in increased demands for automotive power electronics in the future, thereby propelling the growth of the market.

Moreover, with the advancement in technology, there has been developments carried out by the key players towards offering a wider range of automotive power electronic system & associated components which creates numerous opportunities for the growth of the market across the globe. In addition, vehicle safety features such as anti-lock braking systems (ABS), electronic stability control (ESC), adaptive cruise control (ACC), and lane departure warning (LDW) rely on advanced power electronic components which enables companies to offer effective components thus creating a wider scope for the growth of the market across the globe.

Developments have been carried out by the key players & government organizations to offer subsidies & support the automobile industry infrastructure which has created a wider scope for the growth of the market across the globe.  For instance, in September, 2022, Government of India’s Ministry of Road Transport and Highways mandated the vehicle manufacturers to install six air bags in a vehicle in order to ensure safety of the passengers in a vehicle. Similarly, organizations across Europe & America have implemented regulations & standards such as Euro NCAP, NHTAS to ensure safety on roads.

For instance, in January 2023, STMicroelectronics introduced a new automotive safety microcontroller aimed at enhancing the reliability and functionality of advanced driver assistance and autonomous driving systems. The microcontroller, developed with 40nm FD-SOI process technology, features multiple redundant CPUs, memory protection units, and hardware-based safety mechanisms to ensure high-performance, secure, and fail-safe operation. Furthermore, it complies with various safety standards such as ISO 26262 and ASIL-D, making it suitable for deployment in safety-critical applications within the automotive industry.

COVID-19 Impact Analysis:  

The COVID-19 pandemic had a significant impact on the automotive power electronics industry. The automotive industry encountered production shut-down at global level along with shortage of labour across the globe due to the imposed restrictions & at the same time ensuring least human interaction. Moreover, the shortage of necessary automotive components across the globe created an adverse impact on the market.

KEY FINDINGS OF THE STUDY

• By device, the Module/Discrete segment dominated the Automotive Power Electronics Market in terms of growth rate.
• By application, the Module/Discrete segment is anticipated to exhibit a remarkable growth during the forecast period.
• By drive type, the Electric Vehicle segment is anticipated to exhibit a remarkable growth during the forecast period.
• By region, the North America region is anticipated to exhibit a remarkable growth during the forecast period.

The key players profiled in this automotive power electronics market report include BorgWarner Inc., Continental AG, Danfoss A/S, Denso Corporation, Infineon Technologies AG, Mitsubishi Electric Corporation, NXP Semiconductors, ON Semiconductors, Renesas Electronics Corporation and Robert Bosch.