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Taiwan: Semiconductor Value to Rise as Driver Assistance Systems to Become Standard in 10 Years

Motion blurred city road traffic (color toned image)

Industry observers are bullish about the business possibilities offered by ADAS. Data from one of the leading investment companies revealed that 90% of new cars in the next decade will be fully-equipped with ADAS. Such a growing trend could materialise even before the adoption of electric vehicles (EVs) goes in full swing. All that could mean rapid growth in the demand for chips and sensors that drive a vehicle’s system.

Buoyed by such a trend in the future, the value of semiconductors are bound to rise accordingly, industry experts believe. And that could drive Taiwan’s businesses to grow by leaps and bounds as the country accounts for more than half of the world’s output of chips.

Ever since 1974 when the Taiwanese semiconductor industry got its start with the help of a major American electronics company, the island has never looked back. Its semiconductor industry grew so fast that it essentially overtook the U.S. in production, becoming second only to Japan in terms of output by the year 2007. Taiwan has continued its strong push and, by 2009, Taiwan’s output has reached US$39 billion, ranking first in global market share in IC manufacturing, packaging and testing, and second only in IC design. By 2020, Taiwan was the unmatched leader of the global semiconductor industry with its flagship manufacturer becoming the most valuable semiconductor company in the world.

Advanced Driver Assistance Systems (ADAS) minimise human errors, the leading cause of vehicle accidents on the road. Its immediate role is to prevent deaths and injuries by reducing the number of car accidents and the serious impact of those that cannot be avoided.

At the heart of ADAS is Artificial Intelligence (AI) coupled with a host of sensors and cameras. Significant strides have been made in the area of automotive safety. Passive safety measures (e.g., shatter-resistant glass, airbags) are a thing in the past. Today, AI with sensor fusion can identify and process objects similar to a human brain allowing the vehicle to respond faster than any human driver could.

At its essence, ADAS is all about safety. Essential ADAS features include traffic sign recognition and pedestrian detection/avoidance. Small wonder ADAS is utilised extensively by self-driving or autonomous car technology today. Indeed, ADAS development is central in building up a smart transport system. Already, industry stalwarts note that Taiwan’s ADAS developers are focused on image sensors, panorama monitoring or automotive chips. To be able to compete in a global market, these developers must tackle three key challenges: 1.) how to effectively manage the cost of installing lower-end ADAS on cheaper cars; 2.) how to apply autonomous driving data to an ADAS; 3.) how to manage ADASs on software-defined vehicles (SDVs), industry suppliers noted.

Taiwan’s leading taxi supplier is leading the way. It is working hand in hand with an AI tech supplier. By doing so, it is taking preemptive action in anticipation of these market changes. To date, about 50 of its 22,000-car fleet has been equipped with ADASs.

Another key challenge is to incorporate vehicle-to-everything (V2X), a concept where a vehicle on the road can communicate and transfer information from moving parts of a traffic system, to ADAS tech. The good news is Taiwan’s traffic with its wide range of traffic scenarios can play a central role as a pilot testing ground for other major cities of the world.

While it is certain to be a long and winding road ahead, there may not be a better launching pad for ADAS technology than Taiwan. Its superior manufacturing prowess coupled with a technically-proficient workforce has made the island a suitable starting point for the entry of one of its biggest manufacturers into the advanced digital healthcare devices market for Asia, as reported by OpenGov Asia.

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