Electric vehicle manufacturers aren't the only beneficiaries from the boom in autonomous vehicles. Semiconductor companies – the firms behind the technology used for these safety features – may also outperform, according to Goldman Sachs. Semiconductor technology is used for avoiding accidents in the advanced driver assistance system or ADAS featured in electric vehicles. These systems anticipate possible collisions with vehicles, pedestrians or other objects, and warn the driver about other dangers. Goldman said the semiconductor market for autonomous driving systems should grow from about $2.5 billion this year to $11 billion by 2025. The bank estimates that the market will hit nearly $22 billion by 2030. "While the timeline to higher levels of autonomy has shifted to the right, the emergence of more sophisticated levels of functionality, including enhanced safety and quasi-autopilot features, offers an increasingly rich semis content opportunity," Goldman equity research analyst Alexander Duval told clients. Goldman said multiple companies in its coverage, like chip company Nvidia , could benefit from the increased need for various types of semiconductor content in autonomous driving systems as this technology evolves and is used in more cars in the coming years. Buy-rated Infineon Technologies is the leader in microcontroller units for radar signal pre-processing. STMicroelectronics , which has a sell rating from Goldman, also holds a strong position in radar, but with a smaller market share than Infineon. "We estimate [Infineon Technologies] has c.30% global market share in [microcontroller units] today, based on the company's comments that its AURIX MCU is gaining traction and achieve 30%+ market share in the ADAS segment," said Duval. Renesas and NXP Semiconductors are also notable players in this space, with strong positions on 32-bit microcontroller units. "These players are namechecked in our industry discussions as having the highest computing performance MCU chips when compared with some other players, per our industry discussions, which we believe is due to a strategic choice to pursue compute power," said Duval. Goldman has a buy rating on Renesas and a hold rating on NXP. Perception and decision-making software in autonomous driving systems needs to run on powerful compute chips, rather than purely microcontroller units. This is where Nvidia is a key player, said Goldman. The bank doesn't have a rating on the chip maker. Although Goldman has a sell rating in semiconductor company Intel , it likes the company's 2017 acquisition of MobileEye, a provider of camera vision subsystems and processing chips for active safety and autonomous driving functions. — with reporting from CNBC's Michael Bloom.
Nvidia founder, President and CEO Jen-Hsun Huang
Electric vehicle manufacturers aren't the only beneficiaries from the boom in autonomous vehicles.
Semiconductor companies – the firms behind the technology used for these safety features – may also outperform, according to Goldman Sachs.