According to business intelligence firm Fact.MR, the microcontroller market will experience a 10 percent compound annual growth rate (CAGR) through 2029. The firm estimates the segment’s expansion will be driven by the components increasing use in the automobiles, automation, and smart devices sectors. As of 2020, the microcontroller industry has an estimated value of $10.17 billion.
Smart Cars Lead the Way
Automobiles used to serve as personal transportation for consumers, but carmakers are increasingly designing them to act as third places that bridge the gap between work and home.
The transition came about because manufacturers want to appeal to the preferences of Millennials, the world’s largest consumer demographic. Raised using computers and deeply attached to their smartphones, the generational cohort wants their cars connected, convenient, and secure.
The remarkable success of innovative car brand Tesla highlights the growing market preference for robust in-vehicle entertainment centers, advanced operator recognition, and semi-autonomous operation.
To engage tech-savvy buyers, auto manufacturers will need to design increasingly sophisticated cars, which will require multifaceted microcontroller units. The components allow for the creation of complex vehicle networks that can manage automobile operation, routing data, and media display. As hyper-connected Generation Z comes into vehicle purchasing age, the consumer preference will become more pronounced.
This third place trend in automobile design can sustain the continued growth of the microcontroller industry throughout the decade. Fact.MR notes the automotive sector will account for one-third of the market.
Wearables and Automated Manufacturing Boost Demand
The business intelligence firm also identified the wearables and automated manufacturing fields as crucial drivers of the microcontroller market.
The organization again points to the preferences of Millennial consumers as a key motivator for the development of connected accessories. For instance, last year IBM debuted a smartwatch that can unfold into a tablet. Similarly, Amazon is developing a new wearable that will use biometric data to track a user’s emotions.
As manufacturers create more “outside the box” wearables, they’ll invest in powerful system-on-a-chip components to power them.
Fact.MR notes the automatization of the manufacturing sector will also drive growth in the microcontroller market. To function in concert, self-directed machinery will need strong individual processing capability and data transmission capacity that microcontrollers can provide.
The organization also highlights a particular area of opportunity within the sector. The firm reports the current generation of microcontroller tech has a high failure rate within extreme temperature environments. As such, a manufacturer that can design and affordably produce ruggedized microcontroller units would stand to profit greatly.
Given the market’s healthy CAGR, semiconductor companies would be well-served by pursuing microcontroller innovation in terms of functionality or durability.