Navigating automotive semiconductor volatility: From shortage to oversupply

This report examines how slowing EV adoption, new tariffs, and delays in software-defined vehicles are reshaping semiconductor demand. While SiC devices shift from shortage fears to oversupply, overall volatility continues to define the market.

Geopolitics is a central driver, with governments pushing local capacity and OEMs diversifying supply chains. Taiwan remains critical for wafer capacity but exposes the industry to concentration risks, while mainland China is emerging as both the largest consumer and a growing supplier, especially in power semiconductors.

Analog demand remains structurally strong, led by power management, sensing, and connectivity. Capacity expansion is concentrated at TSMC, mainland China, and Texas Instruments, offering limited but important diversification options.

At the same time, the AI-driven data center boom is absorbing capacity for GPUs and high-bandwidth memory, raising risks of tighter supply and higher costs for automotive.

Together, these forces are redefining the automotive semiconductor landscape and will continue to test the resilience of global supply chains.