Although there have been certain fluctuations and adjustments in the global chip industry, the demand for automotive and industrial chips still demonstrates resilience. The specific manifestations and reasons are as follows:

The Resilience of Demand for Automotive Chips and Its Causes

Intelligent and electrification-driven growth continues: The continuous deepening of the intelligent and electrification transformation in the automotive industry has provided sustained support for chip demand. The advancement of autonomous driving technology from L1-L2 to L3 and above levels requires the processing of massive data from multiple sensor fusion, resulting in a significant increase in the demand for high-performance computing chips. It is predicted that the global market for autonomous driving chips will grow from approximately $5 billion in 2020 to nearly $20 billion in 2025. At the same time, the battery systems of new energy vehicles also require precise power management chips to ensure the safety and efficient operation of the batteries. Moreover, the intelligent cabin integrates various functions such as human-computer interaction, information entertainment, and navigation, which also prompts an increase in the demand for multiple types of chips such as processors, voice recognition, and image recognition.

Demand Stability under Supply Chain Transformation: After experiencing the previous chip supply shortages, automakers have deeply realized the significance of chips and have begun to focus on the diversification and stability of the supply chain. They have established closer cooperative relationships with chip suppliers. Even during market fluctuations, they tend to maintain a certain scale of chip purchases to ensure the continuity of production, which has made the demand for automotive chips exhibit greater resilience.

The incremental growth brought by domestic substitution: In the context of global chip supply shortage, the domesticization process of automotive chips in China has accelerated. Domestic enterprises have increased their research and development investment and have achieved breakthroughs in some areas. For instance, the Horizon series of autonomous driving chips launched by Horizon have already achieved mass production and been installed in vehicles. The national policies also strongly support the development of the automotive chip industry, encouraging domestic chip enterprises to collaborate with automakers to build a local automotive chip industry ecosystem. The entry of domestic chips into the supply chain has also brought new vitality to the market demand.

The Resilience of Industrial Chip Demand and Its Causes

Policy-driven infrastructure demand: Industrial chips will show a moderate recovery trend in 2025. The core driving force comes from China's "new infrastructure" investment and the return of manufacturing industries from Europe and the United States. China has continuously invested in new infrastructure areas such as 5G base stations and industrial internet, which has stimulated the demand for related industrial control and communication transmission types of chips. Meanwhile, Europe's efforts to promote the return of manufacturing capacity have also provided certain support for the demand for chips in areas such as factory automation transformation.

Rigidity of industrial scenario demands: The demand for chips in industrial equipment and automation systems in the industrial sector exhibits a rigid characteristic. On one hand, the demand for upgrading and replacing chips in old equipment persists. On the other hand, the development of emerging industrial technologies such as industrial Internet of Things and intelligent manufacturing also requires a large number of compatible chips. This ensures that the demand for industrial chips has a stable base and will not significantly decline due to short-term economic fluctuations or industrial adjustments.