A need for integration

As vehicles become increasingly connected, autonomous, shared and electric (CASE), semiconductors are now at the heart of innovation, enabling greater safety, efficiency, and intelligence in modern automobiles.  

Malaysia’s role as the world’s sixth largest semiconductor exporter points to a well-established semiconductor industry. But lifting its competitiveness regionally requires a shift towards high-end manufacturing.  

The Malaysia Automotive, Robotics & IoT Institute (MARii), an agency under the Ministry of Investment, Trade & Industry (MITI), is driving synergy between the semiconductor and automotive industries to enable this shift. Three key national policies, including the New Industry Master Plan 2030, National Automotive Policy 2020 and the National Semiconductor Strategy, are anchoring this cross-sector integration. 

In this report, we explore how technology breakthroughs are shaping manufacturing processes, and reveal new avenues for value creation across the semiconductor supply chain. 

No chips, no cars 

The average ICE vehicle now contains 300-1,000 chips, and xEV vehicles may feature up to 3,000 chips. Semiconductors are increasingly indispensable, and it’s no surprise that automotive electronics are one of its fastest-growing segments.

Semiconductor and automotive sectors are strong but operating in parallel 

Segments of the semiconductor ecosystem that were traditionally deemed lower value have become increasingly critical. There are opportunities to advance its existing semiconductor assembly and testing strengths, towards high-end manufacturing and design segments. 

Capturing the right to win 

Three high-value battlegrounds are emerging.  Semiconductor design is increasingly playing a key role in product value. Materials with a larger energy bandgap are allowing vehicles to operate with greater performance and efficiency. And packaging is becoming a prime lever for system performance.  

With ongoing investments in talent, research, and infrastructure, the nation is well-placed to capture opportunities arising from the convergence of mobility and technology. By fostering collaboration between industry stakeholders, Malaysia can solidify its status in supporting the next generation of automotive solutions.