Samsung Secures Automotive Chip Deal with Hyundai

Samsung has struck a deal with Hyundai Motor Company to produce 8nm automotive chips. This will help the Korean firm expand its presence in the automotive semiconductor market. It plans to begin mass production of these chips in 2030.

Samsung to expand its automotive semiconductor business with the Hyundai deal

Samsung’s Foundry division may not have attracted big clients for its advanced processes, but its older nodes are gaining traction in the industry. The company recently succeeded in securing an order from Hyundai Motor Company, a South Korean automotive manufacturer, with its mature process technology. According to a report from ZDNet Korea, Samsung will make the domestic automaker’s chip using its 8nm node.

Hyundai Motor Company plans to complete the development of its chip by 2028. The project will be led by Song Chang-hyun, Head of Advanced Vehicle Platform (AVP) Headquarters. In January, Hyundai Motor Group set up the AVP Headquarters to integrate Hyundai and Kia’s research and development (R&D) capabilities and software (SW) technology development.

However, the automotive chip will enter the mass production stage two years later, in 2030. Hyundai Motor Company’s decision to choose Samsung’s 8nm process is mainly due to its cost-effectiveness. “The 8nm process is currently perceived as cost-effective (by customers),” said a semiconductor industry insider. “As it is a mature process, it seems suitable for use in vehicles.”

Meanwhile, Samsung will also make ADAS chips for Hyundai’s luxury vehicle sub-brand, Genesis, using the 5nm node. However, the report says the domestic automaker has delayed the project until next year. Unlike the 5nm chip, the Korean foundry will produce the 8nm chip in much larger volumes, as Hyundai will use it in all mass-produced vehicles.

In July, Samsung reached an agreement (valued at $16.5 billion) with Tesla to make the car maker’s next-generation AI6 chip. Now, Hyundai’s recent order will help the Korean Foundry earn a reputation as a reliable partner for automakers.