South Korea is experiencing an increasingly visible technological paradox. Its major semiconductor manufacturers, Samsung Electronics and SK hynix, are among the most important players worldwide in memory for data centers, mobile devices, and artificial intelligence infrastructure. However, in a market that will also be decisive for the next decade—automotive chips—the country still trails behind international competitors with more experience in this segment.
This contrast is reflected in data from the Korea Automotive Technology Institute, reported by Korea JoongAng Daily. Micron led the global automotive memory market in 2024 with a 51.7% share by revenue, while Samsung Electronics ranked second with 16.8%, and SK hynix was fifth with only 3%. For two companies that dominate a large part of the global DRAM market, this difference shows that connected cars demand more than just advanced manufacturing capacity.
Automotive manufacturing has its own set of rules. Development cycles are longer, contracts are signed years in advance, and the priority is not always maximum performance but rather reliability, durability, and safety under extreme conditions. An integrated chip in a vehicle must withstand temperature fluctuations, vibrations, and validation requirements quite different from those of a mobile phone or server.
Micron gained an edge before its Korean rivals
Micron entered the automotive memory business in the early 1990s and has since built stable relationships with vehicle manufacturers and component suppliers. This early advantage is significant in an industry where switching suppliers is neither quick nor easy.
In contrast, Samsung and SK hynix have prioritized faster-growing, more immediately profitable segments for years: AI data centers, mobile devices, servers, and high-performance memory. This strategy has yielded strong results in the current AI cycle but has left Korea with a more limited presence in automotive chips.
The economic explanation is understandable. Automotive chips typically offer narrower margins than advanced AI or consumer electronics products and require stricter quality controls and lengthy certification processes. For some manufacturers, this has reduced their priority compared to markets where demand grows faster and product cycles are shorter.
But the automobile is changing. Software-defined vehicles, assisted driving, infotainment systems, sensors, cameras, and connectivity are transforming the car into a digital platform on wheels. This shift is rapidly increasing the need for memory and processing capacity.
Connected cars will boost their memory demand
Projections from the Korea Automotive Technology Institute indicate a significant leap. A conventional vehicle equipped in 2024 with about 90 GB of memory, including DRAM and NAND, could reach 278 GB by 2026 and up to 4 TB in 2030. If these figures hold, the automobile will cease to be a secondary memory market and become a much more strategic source of demand.
Growth won’t come solely from passenger cars. Industrial memory used in robotics, automated machinery, and control systems will also increase in importance. Factory, warehouse, and logistics automation require reliable chips designed for long lifecycles and demanding environments.
This scenario presents an opportunity for Korean manufacturers but also a risk. If Samsung and SK hynix continue to concentrate most of their capacity on AI semiconductors, the automotive and industrial sectors could face supply tensions. This happened during the pandemic when chip shortages halted manufacturing lines worldwide and highlighted how automobile production depends on a complex supply chain.
South Korea’s industry aims to prevent history from repeating itself. Hyundai Mobis launched the Auto Semicon Korea forum last year, together with local companies like Samsung Electronics, LX Semicon, and SK keyfoundry, aiming to strengthen the national automotive semiconductor supply chain. According to an Hyundai Mobis source cited by Korea JoongAng Daily, domestic production accounts for just around 5%, making the sector vulnerable due to its reliance on imports.
A stable opportunity amid memory cycles
The automotive chips market doesn’t move as quickly as the AI data center segment but offers a key advantage: stability. Long-term contracts can provide more predictable revenue during memory downturns when DRAM and NAND prices often fall sharply.
For Samsung and SK hynix, entering automotive more robustly would require patience, investment in certifications, close collaboration with automakers, and a less short-term focused vision. It’s not just about selling chips but becoming trusted partners for platforms expected to stay on the market for years.
South Korea possesses advanced technology, industrial talent, and mass production expertise. What it needs is to solidify its position in a segment where trust is built over decades. The race for AI has captured market attention, but software-defined cars will also need reliable memory, storage, sensors, and chips that operate flawlessly.
The challenge for Korea will be balancing two priorities. On one hand, avoiding missing out on AI progress where Samsung and SK hynix compete in high-bandwidth memory and advanced chips. On the other, preventing the future automotive market from being dominated by competitors who entered earlier and understand that, in automotive, reliability is as valuable as performance.
Frequently Asked Questions
Who leads the automotive memory market?
Micron led the global automotive memory market in 2024 with a 51.7% share by revenue, according to data from the Korea Automotive Technology Institute reported by Korea JoongAng Daily.
Why are Samsung and SK hynix lagging behind in automotive chips?
Because they have prioritized high-performance, fast-growth segments such as AI data centers, mobile devices, and servers, while automotive demands long cycles, strict certifications, and stable manufacturer relationships.
Why will memory demand in vehicles grow?
Because of the rise of connected cars, assisted driving, infotainment systems, sensors, and software-defined vehicles—all of which require much more memory and processing capacity.
via: korea joongang daily