Both Tesla CEO Elon Musk and Nvidia CEO Jensen Huang consider humanoid robots to be the ultimate chapter in AI development. According to a Goldman Sachs research forecast for the first half of 2024, humanoid robot shipments are expected to exceed 250,000 units by 2030, with nearly all deployments in industrial sectors.
As semiconductor chips, software, and algorithms form the foundation of AI advancement, the industrial sector has become a contested territory that major chip manufacturers worldwide aim to conquer, leading to an impending battle between two forces.
The rise of AI titans
The first group consists of emerging players led by AI giant Nvidia and its supply chain partner Qualcomm. These two companies are poised to enter the industrial space, leveraging advancements in AI and future vehicle technologies. Nvidia specifically aims to penetrate the market through humanoid robots, seeking to expand into entire factories. The company's Isaac Perceptor can be used in autonomous mobile robots (AMR) and provides generative AI and GPU acceleration libraries for robotic arm developers to sense their surroundings and interact accordingly.
IDM veterans defend their turf
The second group comprises established IDMs. The current leaders in industrial semiconductors are NXP and Microchip Technology, which together account for approximately 50% of the global market share for industrial chips. Other notable players include Renesas, TI, Infineon, and STMicroelectronics, many of whom have longstanding experience in automotive-grade IDM chips.
While IDMs have deep roots in the automotive sector, which has naturally positioned them as leaders in the industrial domain, new entrants face similar challenges to those in the automotive field. Both factions increasingly recognize the importance of parallel developments due to advancements in AI, 5G, edge computing, and cloud technology for several reasons.
Technology crossover between sectors
From a semiconductor manufacturing perspective, while industrial and automotive applications operate in different domains with varying specifications, they exhibit significant similarities. Recent conferences have showcased the developmental narratives of both old and new players in these fields. The upcoming NXP Technology Summit will also follow this trend.
According to an industry expert, many technologies mature in the industrial sector before crossing over to tackle the automotive arena, often supported by recognized standards. Within the same semiconductor production line, adjustments can be made to meet the needs of both industrial and automotive regulations, whereas commercial standards cannot easily adapt to either.
The implementation of independent 5G networks creates low latency, high speed, and multi-connection features. While the connected vehicle ecosystem awaits further infrastructure completion for 5G, smart factories may implement 5G networking ahead of schedule.
However, questions remain about whether cost-conscious factories will invest in independent 5G networks. The industry expert stated that such investments would be limited to factory premises, requiring significantly less capital than automotive projects. If the benefits and profits generated surpass previous levels, businesses will eagerly pursue this opportunity.
Building comprehensive ecosystems
The drive for seamless connectivity is fostering complete ecosystems. Semiconductor companies are embracing the robotics age, riding the wave of AI, edge computing, 5G, and cloud development to build their platforms. This allows for smart connections across the home, consumer electronics, industrial, and automotive sectors, aiming for comprehensive integration within the IoT. If these companies fail to expand in this new era, they risk being overtaken by other competitors.
The data generated from various application domains can lead to economies of scale in digitization. Although the output value in the industrial sector struggles to compete with that of consumer electronics and automotive industries, major semiconductor firms like Nvidia and Qualcomm remain vigilant because they see it as an indispensable piece of the puzzle for the future.
