Likely to Develop Core Semiconductors for Vehicles

Samsung Electronics and Hyundai Motor Co. have joined hand to solve the automotive semiconductor shortage.

Samsung Electronics and Hyundai Motor Co. have teamed up to solve the global automotive semiconductor shortage. The two companies are expected to make efforts to internalize the supply chain of core automotive semiconductors.

The two companies signed an agreement on May 13 with the Ministry of Trade, Industry and Energy, the Korea Automotive Technology Institute and the Korea Electronics Technology Institute for cooperation in the automotive semiconductor field.

Through technical cooperation, the two companies will develop next-generation power semiconductors, image sensors, battery management chips, and application processors (APs) for car infotainment systems. They are expected to push for mid- to long-term joint technology development in APs for self-driving cars, AI accelerators and telecommunication processors for future vehicles.

In line with this, the Korean government is planning to build a system to enhance Korean industry’s self-reliance in the whole automotive semiconductor cycle.

Although Korea is the world's number one memory semiconductor powerhouse, the nation accounts for only 2 percent of the world automotive semiconductor market. Semiconductors for vehicles are usually produced using 8-inch wafers, but Samsung Electronics is focusing on high-performance products that are based on 12-inch wafers. Automotive semiconductors are less profitable compared to mobile semiconductors.

For this reason, cooperation between Samsung Electronics and Hyundai Motor is unlikely to produce some tangible positive results in a short period of time. However, semiconductor industry watchers predict that the two companies will be able to create a new market for system semiconductors together as the automobile market is shifting to electric vehicles and autonomous vehicles.

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