Core Viewpoint - The automotive chip market is experiencing a cooling phase after a rapid growth driven by the "new four modernizations" in the automotive industry, leading to strategic exits and adjustments from major players in the sector [2][21]. Group 1: Industry Trends - The demand for automotive chips surged due to the rise of smart vehicles, creating a hotbed for investment and entrepreneurship in various chip categories such as image processing chips, automotive-grade MCUs, and radar chips [1]. - However, since 2025, both Silicon Valley giants and local companies have begun to signal a contraction in their automotive chip businesses, indicating a market cooling [2]. Group 2: Major Company Actions - Intel announced plans to gradually shut down its automotive business, focusing instead on its core client and data center products, reflecting a cautious approach towards the automotive chip market due to long return cycles and intense competition [4][6]. - Ambarella, once a leader in AI chip startups, is reportedly seeking to sell its business as it struggles to achieve profitability, with a significant net loss reported for the fiscal year 2025 [7][8]. - Infineon has postponed the expansion of its "megafab" in Malaysia and reduced investment by about 10% due to market uncertainties, highlighting the cautious sentiment in the automotive sector [9]. Group 3: Domestic Market Dynamics - In China, the automotive chip market has seen intensified competition, leading to a price war that has compressed profit margins and resulted in a decline in product value [10]. - Companies like Broadcom Integrated have adjusted their project timelines and funding allocations due to slow customer validation and increased complexity in AI and autonomous driving requirements [11][13]. Group 4: Future Outlook - Despite the current challenges, the long-term outlook for the automotive chip market remains positive, with projections indicating significant growth driven by the electrification and automation of vehicles [16][19]. - The global automotive chip market is expected to grow from $48.5 billion in 2024 to $187.8 billion by 2034, with a compound annual growth rate of 14.5% [16]. - Certain segments, such as power devices and high-security MCUs, continue to show strong demand, while the market is experiencing structural differentiation, with some companies facing funding challenges and project delays [19][21].