Photo: Ford
Semiconductors have become an essential part of so many products out there. The smarter these products get, the more chips they need, and in some ways, the tech revolution is what has brought us here to a point where the entire world is struggling with the super-constrained chip inventory.
New research published by analyst firm Gartner shows just how big the semiconductor business is becoming.
After the total revenue of the industry reached $595 billion last year, it’s now ready to reach no more, no less than $676 billion in 2022. This means it’s recording a growth of 13.6 percent after increasing 26.3 percent last year.
2023 is expected to bring another massive boost, with the revenue to reach $700 million, this time following a growth of just 3.6 percent.
In case you’re wondering how come the growth is slowing down, it’s all tied to the good news we’ve told you about in the headline.
Gartner believes that the chip crisis is already showing signs of recovery, and the automotive market, which has been hit really hard by the lack of semiconductors, is also on the way to better times. If the company is right, the chip shortage should ease up in late 2022, which means that it shouldn’t take too long before car manufacturers would be able to build cars at pre-2020 levels.
Of course, this is an optimistic forecast, and Gartner itself warns that the semiconductor ASP (average selling price) will remain high in the automotive businesses because of the tight supply. The mass adoption of new technology, such as the investments in EVs and driver assistance systems, is what’s increasing the demand for chips in the short term.
Carmakers, too, seem to be optimistic that the second half of this year would bring a substantially improved chip inventory. However, industry leaders like BMW and Volkswagen don’t expect the shortage to come to an end in 2022, as they both predict another year of struggle for the entire industry.
After the total revenue of the industry reached $595 billion last year, it’s now ready to reach no more, no less than $676 billion in 2022. This means it’s recording a growth of 13.6 percent after increasing 26.3 percent last year.
2023 is expected to bring another massive boost, with the revenue to reach $700 million, this time following a growth of just 3.6 percent.
In case you’re wondering how come the growth is slowing down, it’s all tied to the good news we’ve told you about in the headline.
Gartner believes that the chip crisis is already showing signs of recovery, and the automotive market, which has been hit really hard by the lack of semiconductors, is also on the way to better times. If the company is right, the chip shortage should ease up in late 2022, which means that it shouldn’t take too long before car manufacturers would be able to build cars at pre-2020 levels.
Of course, this is an optimistic forecast, and Gartner itself warns that the semiconductor ASP (average selling price) will remain high in the automotive businesses because of the tight supply. The mass adoption of new technology, such as the investments in EVs and driver assistance systems, is what’s increasing the demand for chips in the short term.
Carmakers, too, seem to be optimistic that the second half of this year would bring a substantially improved chip inventory. However, industry leaders like BMW and Volkswagen don’t expect the shortage to come to an end in 2022, as they both predict another year of struggle for the entire industry.
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