Microcontroller Market Size, Share & COVID-19 Impact Analysis, By Product Type (8-bit, 16-bit, and 32-bit Microcontroller), By Application (Networking & Communication, Automotive, Consumer Electronics, Industrial, Medical Devices, and Military & Defense) and Regional Forecast, 2021-2028

The global Microcontroller Market size was USD 29.06 billion in 2020 and is projected to grow from USD 30.63 billion in 2021 to USD 51.13 billion by 2028, exhibiting a CAGR of 7.6% during the 2021-2028 period. Based on our analysis, the global market exhibited a modest growth of 2.5% in 2020 compared to the average year-on-year growth during 2017-2019. The global impact of COVID-19 has been unprecedented and staggering, with witnessing a positive impact on demand across all regions amid the pandemic. The rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.

The market is moderately competitive with the presence of many established and emerging players in the market. The growth of the market is attributed to the growing attraction towards low power and advanced technology-embedded MCUs in the upcoming years.

The demand for microcontrollers is estimated to grow due to rising automotive applications (electric vehicles, automated cars, etc.), medical devices, consumer electronics, and other industrial applications. Amid the COVID-19 pandemic, the demand for MCUs is predominantly fueled by the need for automated industrial machines, electronic and networking devices, and many more.

COVID-19 Impact: Uncertainty in Business Conditions Hampered the Microcontroller Demand in Automotive Sector

Microcontroller Market players are facing difficulties in analyzing the demand as a greater amount of uncertainty abounds the automotive and industrial sectors, decelerating the GDP growth of developing as well as the developed economies.

As stated by the International Labor Organization (ILO), the automotive industry is facing production process issues and is anticipated to witness sharp drop in the demand, investments and the production of the vehicles across the world. According to the European Automobile Manufacturers Association (ACEA), total automotive sales in European Union (EU) have lowered down at 7.4% in January and February 2020. Following are the four major EU automotive markets facing the downfall in the demand:

• Germany by 9.0%


• France by 7.8%


• Italy by 6.8%


• Spain by 7.3%

Moreover, the National Association of Automobile Manufacturers of South Africa (NAAMSA) stated that the automotive industry, which contributes 7% of the country’s GDP, is experiencing a significant decline in sales; hence it is expected to affect the automotive application in this market over the long term. In the long run, the developing and developed economies are expected to overcome the loss by the effect of the pandemic while focusing on improving the microcontroller market scenario in terms of efficient production and supply chain process.

LATEST TRENDS

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Increasing Adoption of Advanced Driver Assistant Systems (ADAS) Technology to Foster Growth

Demand for advanced driver-assistance systems (ADAS) that offers automated monitoring, braking, warning, and steering functionalities is seen to be surging from last 3 years, and is expected to rise over the next decade. The surge in demand for these systems is largely driven by the consumer interest in safety applications and regulatory norms that help reduce accidents and protect the driver while increasing the demand in cars.

The global and regional MCUs and other semiconductor component original-equipment manufacturers (OEMs) and their suppliers are focusing on creating automotive technologies that would enable ADAS’s offerings to manufacture fully automated vehicles. The majority of the manufacturers are aiming on research and development of advanced driver-assistance systems. For instance, Infineon’s scalable microcontrollers from the AURIX family are known to be suitable for ADAS, along with camera, 2D/3D (TOF), radar (24GHz, 77 GHz, 79 GHz), and sensor fusion applications. NVIDIA’s autonomous vehicle computing platform is integrated with the AURIX multicore microcontrollers unit and is anticipated to be deployed in various data fusion automotive architectures worldwide.

Thus, creating marketing strategies for consumer awareness is projected to surge the ADAS technology demand while offering ample microcontroller market opportunities to the automotive and microcontroller manufacturers around the world.

DRIVING FACTORS

Surge in Demand for Portable Medical Devices to Bolster Market Prospects

Considering the sudden emergence of the COVID-19 pandemic, the medical equipment for original equipment manufacturers (OEMs) are strictly focusing over developing sophisticated healthcare solutions for treating and monitoring the patients suffering from common illnesses, thus improving the quality of healthcare devices at an affordable cost.

MCU plays a significant role in portable medical instruments as it operates at ultra-low power and is embedded with high performance analog peripherals, offering longer battery life to the medical devices. MCU offers digital filtering and processing of the patient’s condition and displays the parametric results of physiological data, such as heart rate, blood pressure, blood oxygen, lungs capacity, and many more.

MCUs are generally used in a variety of medical devices, such as spirometers, heart rate monitors, personal blood pressure monitors, pulse oximeters, etc. In the current market scenario, smart embedded technology-based wearable medical devices are expected to aid the awareness amongst people for their health, thus expected to drive the microcontroller market growth over the forecast period.

RESTRAINING FACTORS

Lack of Intellectual Property (IP) Protection Rights Obstructs Growth in Microcontrollers Industry

With Southeast Asian countries and India becoming the hub for emerging small and medium enterprises (SMEs), designing a strong framework for the protection of intellectual property rights is seen to be lacking across the microcontroller industry. According to the World Intellectual Property (WIPO) report of 2017, the efficiency of IP framework in Vietnam, Indonesia, Malaysia, Thailand, and the Philippines is below the highest global standards, obstructing the growth in semiconductor and other manufacturing sectors. Insufficient and inefficient frameworks for protection and enforcement of IPR lead to fewer microcontroller market opportunities for the manufacturers to participate in knowledge-intensive manufacturing value chains, with loss of economic growth, technology transfer and job opportunities.

SEGMENTATION

By Product Type Analysis

32-bit MCU is Leading Product Type that Holds Highest Market Share  

Based on the product type, the global market is segmented into 8-bit MCU, 16-bit MCU, and 32-bit MCU.

In terms of both microcontroller market share and growth rate, 32-bit microcontroller will hold the highest share and CAGR over the forecast period 2021-2028. This is due to the higher level of functional capabilities that are useful for advanced Internet of Things applications, Industry 4.0 equipment, minute implantable medical devices, etc.

The 16-bit MCUs segment captures second highest market shares, owing to the rising demand for automotive modules required while manufacturing electric or hybrid vehicles, lighting devices, etc. Key market players are projected to surge the manufacturing of microcontrollers with WIFI and microcontrollers with Bluetooth that have highest applications in automotive, consumer electronics, and medical sectors.

Moreover, the 8-bit MCUs segment is expected to depict stable CAGR over the forecast period, as these MCUs have easy programming model and are applicable in applications that require lower power.

By Application Analysis

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Automotive Sector to Witness Highest CAGR over the Forecast Period

As per the application, the market is further segmented into networking & communications, automotive, consumer electronics, industrial, medical devices, and military & defense, respectively.

The automotive sector is projected to witness highest growth rate and microcontroller market share in the forecast period, as the industry is preferring to embrace advanced technology to make the best use of the embedded systems deployed in manufacturing the automotive parts and establish a global position of technological superiority further boosting market. On the other hand, the necessity of working from home is notably rising across the developed and developing economies, thus enhancing the demand for consumer electronics worldwide.

Medical devices segment is expected to witness significant CAGR in the forecast period, as the MCU plays a major role in offering digital filtering and processing of the patient’s condition as well as displays the parametric results of physiological data, such as heart rate, blood pressure, blood oxygen, lungs capacity, and many more. As in case of the industrial segment, manufacturing industries across the developing countries in Asia Pacific and MEA are concentrating over switching towards the automated equipment and machines that simplify the complexity in the manufacturing process while surging the production process and catering the consumer’s demand.

Networking & communication is projected to grow at a stable CAGR with increasing demand for smart phones and smart devices around the world. The increase in data generation has considerably grown since the last two decades every day around the world, while overcoming the challenges related to the conventional data drives, hence propelling the microcontroller market growth globally. MCUs play a major role in the devices used by military and defense sectors across the world, as they carry the load of confidential data with higher risk of information leakages. Henceforth, the military and defense devices are known to be embedded with higher programming ability along with safe cyber operations.

REGIONAL INSIGHTS

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The market is characterized into North America, Europe, Asia Pacific, the Middle East & Africa, and South America and is further divided into countries.

Asia Pacific market will account for the highest CAGR over the forecast period. The mass obtainability of raw materials and low-cost labor are the major factors that drive the growth of the regional market. The upsurge in demand is attributed to the rising standards of living in countries, such as China, India, Malaysia, Thailand, etc. These countries are aiming at modernizing materialistic products, such as automated cars, advanced technology base consumer electronics, automated equipment, and advanced medical devices, etc.

North America is projected to hold the second largest market share, owing to the invention of the semiconductors and their components, with the United States being the market leader in the semiconductor industry. As per the study, the U.S. had the largest ongoing semiconductor research and development investments of USD 39.8 billion in 2019. As a result, this market would create a significant impetus across the region.

Europe is expected to witness moderate market growth in the near future owing to the growth in automotive and medical devices sectors. European countries, including Germany, France, and Italy are renowned automotive manufacturing hubs around the world, considering which the demand for advanced MCUs has been surging across the region since the last decade. Moreover, the biomedical, bioengineering and metallurgical sectors of Europe are advancing their manufacturing processes, thus expected to offer highly advance medical devices to the end-users globally. The Middle East & Africa, and South America are projected to witness stagnant microcontroller market growth owing to minimal development across the end-user manufacturing plants.

KEY INDUSTRY PLAYERS

Key Players Focus on Investment Strategies to Strengthen their Market Position

Prominent market players are keen on initiating merger and acquisition of the small market players with a considerable presence in a particular regional market. These mergers and acquisitions are helping companies increase the product portfolio diversity by aligning the product portfolio of the acquired vendors with its portfolio. The acquisition also enables organizations to leverage manufacturing plants of the acquired entity to increase its manufacturing capabilities.

These players are emphasizing long-term investment activities to maintain liquidity and preserve capital while generating appropriate returns.

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  • For instance, in 2019, in Germany, Biesse Group inaugurated the innovative ‘Ulm Campus’ dedicated for cutting edge technology solutions.
  
  
  • For instance, Texas Instruments focuses on venture capital funds and non-marketable equity securities (carried at fair value across countries) as a long-term investment activity.
  
  
  
  

Major players are investing in businesses that offer complementary products and services and are acquiring international & regional manufacturers to offer quality assurance to end-users.

LIST OF KEY COMPANES PROFILED:

• TOSHIBA ELECTRONIC DEVICES & STORAGE CORPORATION (Japan)


• Texas Instruments Incorporated (U.S.)


• Microchip Technology Inc. (U.S.)


• Renesas Electronics Corporation (Japan)


• STMicroelectronics (Switzerland)


• NXP Semiconductors (Netherlands)


• Intel (U.S.)


• Infineon Technologies AG (Germany)


• Maxim Integrated (Analog Devices) (U.S.)


• ON Semiconductor (U.S.)


• ROHM CO., LTD. (Japan)


• Zilog, Inc. (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• January 2021: Toshiba Electronic Devices & Storage Corporation introduced 5 new groups of TXZ+ family advanced class microcontrollers. The M4K, M4M, M4G, and M4N groups are based on Arm Cortex-M4 core, and the M3H group is based on the Arm Cortex-M3 core. These MCUs are suitable for several applications, such as connected IoT devices, motor control, leading-edge sensing functionalities, etc.


• September 2021: STMicroelectronics announced new software packs and tools namely STM32 ecosystem extensions kick-start development with STM32U5 extreme low-power microcontrollers for mass market applications.


• September 2021: Infineon Technologies AG announced that the PSoC 64 Standard Secure MCU family has achieved the Arm Platform Security Architecture (PSA) Level 2 certification for the IoT devices

REPORT COVERAGE

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The microcontroller market report provides detailed information regarding various insights and the industry statistics. Some of them are growth drivers, restraints, competitive landscape, regional analysis, and challenges. It further offers an analytical depiction of the market trends and estimations to illustrate the forthcoming investment pockets. The market is quantitatively analyzed from 2021 to 2028 to provide financial competency. The information gathered in the report has been taken from several primary and secondary sources.

Report Scope and Segmentation