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Each year comes with changes and new opportunities. The IC chip industry is expected to be affected by several such changes. This is quite expected in the world of technology where things tend to be moving at a very fast pace. Are you in the IC chip industry? Whether you are into building products using IC chips or you are in the supply and distribution of IC chips, chances are you are anticipating something new in the industry. The fact that IC chips are the drivers of modern technology means that any small change or development will affect the entire industry.
So, what are some of your expectations in the IC chip industry? What product segments will grow and which ones will drop? How will the market behave in 2024? Let’s look at some of the trends that are likely to make a major impact on the IC chip market in 2024.
Growth of EV industry
The growth of the electric vehicle industry is likely to have a serious impact on the IC chip in 2024. We have already seen this in 2023 in which automakers have been heavily investing in electric vehicles. We expect to start seeing the results of these investments in 2024 when the demand and the supply of EVs will go up.
It has already been predicted that the electric vehicle semiconductor market segment to grow at a CAGR of 30% between 2022 and 2028. If all factors remain constant, the growth will push the demand for IC chips higher in 2024.
The AI industry has been quite busy in 2023. The technology has been widely adopted in different applications, both as software and hardware devices. The technology has come with an array if challenges and this explains why its popularity keeps growing. For example, its usage has helped to reduce the cost of running some businesses.
In 2024, we expect an increase in the adoption of AI-based devices and products. Autonomous vehicles and robots are increasingly becoming popular in our daily lives. This will have a direct impact on the AI chip market. These are semiconductor chips that are specifically designed for AI and machine learning applications. The market size for these chips will grow significantly from 2024 and beyond. Data centers that provide a training ground for AI applications will also witness high demand for AI chips.
Internet of Things (IoT)
The capacity and capabilities of the Internet of Things are growing at a steady rate. Also, more customers are signing up to use the IoT technology. Since the whole IoT spectrum relies on electronics, we expect to witness a significant growth of the IC chips that are used in this industry. This is vital as more IoT products will be released to the market.
Powerful features such as analytics, self-diagnosis, AI, power management, and many others are embedded into IoT devices. All these applications need separate and specialized IC chips, a factor that will have a direct impact on the supply chain of semiconductor chips.
Optimization of 5G connectivity
5G technology has already been already been rolled out and is being implemented in different countries. In 2024, we expect full optimization of this technology. There will be a high demand for IC chips for 5G n technology. These chips are designed to support faster data transmission and processing. Device manufacturers are also expected to embed these chips into their different devices.
The global 5G IC chip market is expected to witness a CAGR of 17.4% up to 2030. This is already an indication that we should have high hopes and expectations about these chips in 2024.
Other than the above trendy sectors, many other industries are affected to have an impact on the IC chip market. Decisions by key policymakers such as governments and industry leaders will affect the market behavior of the IC chips.
2024 is promising to be an exciting year for the IC chip industry. From the predictions, we should expect a year characterized by growth and innovation in the sector. For example, IC chips are expected to be more powerful and capable of performing complex tasks. On the other hand, the market size should be ready to grow welcoming new players while the existing players will try to flex their muscles.
Regardless of your place in the industry, you should try to position yourself at a better place in readiness for the predicted developments that will affect IC chips in 2024. One way of doing so is by choosing reliable partners in the industry. If you rely on electronic components for your business, then the focus should be on working with a reliable semiconductor chip distributor. This way, you can be sure of a constant supply of the IC chips regardless of the external changes.