The global microcontroller (MCU) market has undergone significant shifts in recent years, largely influenced by supply chain disruptions caused by the pandemic, combined with foundry capacity shortages and stockpiling.
These factors led to a sharp increase in average selling prices (ASPs), rising from approximately $0.60 in 2020 to $0.93 by 2023. Despite the stabilisation of supply chains and the return of just-in-time ordering by late 2023, ASPs have not returned to pre-pandemic levels.
However, the entry of new suppliers, particularly from Mainland China, has created price competition, partially offsetting the previous price surge. Government-backed incentives in China have encouraged new entrants into the MCU market, igniting price wars that have helped temper ASP growth. Nonetheless, a full return to pre-pandemic prices remains unlikely. According to Tom Hackenberg, Principal Analyst, Computing & Software at Yole Group, advancements in MCU technology – such as the adoption of cutting-edge process nodes, the shift from lower-cost smartcard MCUs to more advanced secure MCUs, and increasing demand for high-reliability MCUs in specific sectors – have contributed to maintaining elevated prices. These factors have slowed the pace of any substantial price reductions.
In Yole Group’s ‘Status of the Microcontroller Industry 2024’ report, the firm offers an in-depth analysis of the MCU market, providing critical data for businesses, institutions, and stakeholders. The report presents long-term forecasts and examines key technology trends and market dynamics, serving as a complement to Yole’s quarterly Microcontroller Market Monitor.
The report also explores the competitive landscape, highlighting the leading and mid-sized MCU suppliers catering to small and mid-sized OEMs. While gradual price declines are expected, with projections suggesting ASPs may decrease to around $0.88 in the coming years, the market remains influenced by factors such as global inflation and supplier-driven price competition. Yole anticipates that MCU prices will hover around $0.90 through 2029, influenced by both product substitution and inflationary pressures across industries.
Among the leading MCU manufacturers, companies like Infineon Technologies, Renesas, and NXP remain highly competitive, with only minor differences between them. NXP continues to hold a dominant position in the automotive MCU sector. As the COVID-19 pandemic transitions to an endemic phase, MCU suppliers have begun adjusting their global strategies. Despite the growing number of smaller suppliers, especially from Asia, the competitive landscape has remained relatively stable.
Chinese OEMs have made significant strides in the semiconductor market, with a particular focus on MCU development. This expansion is driven by increasing demand in sectors such as smart home systems, the automotive industry, and the integration of AI into various applications. Chinese firms are increasingly investing in in-house MCU development to improve supply chain control and foster self-sufficiency. Notable companies like BYD Semiconductor, China’s leading MCU manufacturer, have risen to prominence through substantial investments in this area.
The ‘Status of the Microcontroller Industry 2024’ report provides detailed insights into these market dynamics, offering valuable information for anyone involved in the evolving MCU market.
