Semiconductors power everything we do. From the moment your smartphone alarm wakes you until the time the music on your smart speakers puts you to sleep, every single gadget surrounding us in our daily lives has a semiconductor at its core.
This has become especially true in our vehicles. When you utilize basic functions like windshield wipers, power steering, power windows, or automatic seats, you’re engaging a semiconductor. Newer features such as blind-spot detection and parking assistance are 100% electronically controlled — they neither rely on nor involve any moving parts or pieces.
Our cars are becoming more electronic than mechanical, and semiconductors, the building component of what are often called integrated circuits or microchips, lay the foundation for these electronic components to work. Semiconductors are no longer just an organ in the car’s body — they make up the very bloodline of what keeps it going.
For a hundred years, manufacturers in the auto industry sought to outperform one another by making incremental mechanical adjustments, usually to the engine, but this is no longer the case. In 2007, 20% of the cost of a new vehicle came from semiconductors. Today, that number is 40%. By 2030, experts estimate it will be about 45%.
Whether we know it or not, we purchase cars based on their electronics. Entertainment, safety, ease of driving, and even a car's mechanical power are controlled electronically. As a result, semiconductors have become the primary differentiator between auto manufacturers
If semiconductor technology is the bloodline of our automobiles, manufacturers are realizing what we already know about human blood: it’s better produced in-house than transfused. Initially, only a few companies were producing semiconductors. Automakers were all sourcing from the same locations, which made it difficult to achieve a competitive advantage. Today these companies are seeking to bring this technology in-house.
Likewise, the original equipment manufacturers (OEMs) could choose to go ‘fabless’ — design chips specifically tailored to their own needs in-house while outsourcing the production to established chipmakers. Just as Amazon’s foray into chip development specific to cloud-based server applications for Amazon Web Services could potentially pave the path for high-performance computing, OEMs can develop semiconductors in-house. Doing so would mean their chips would match their specific industrial needs for more optimized performance and shorter development cycles for feature improvements.
With deeper operational expertise than a service player with pure semiconductor background and a strong relationship with automobile, aerospace, bio-medical, healthcare, railways, and consumer electric industries—all among the biggest consumers of semiconductors—companies like Quest Global have the edge over others. We’re not just familiar with the technology—we’re like a surgeon primed with precision instruments rather than knives and scissors.
From aerospace, communication, healthcare, transportation, consumer electronics, and hospitality to travel and leisure, we need semiconductors everywhere. Global semiconductors sales increased by 23% from the first quarter of 2021 to 2022, with sales touching 1.15 trillion units in 2021. But just three industries—automotive, computation and data storage, and wireless—could drive 70% of that expected growth.
The shift to electric or hybrid electric vehicles will be necessary to meet global CO2 emissions reduction plans and the pressing need to address climate change. Better electronics have now become standard, enabling safer cars and safer drivers.
The future of automotive, and other increasingly automated industries, will depend on the efficiency and rapid performance increases of the semiconductors powering them.