With the proliferation of artificial intelligence applications, global demand for DRAM and NAND memory chips continues to increase. This crisis, which was previously felt in data centers and consumer electronics products, now directly affects the automotive sector.

Advanced systems used in modern vehicles increase the memory requirement to a more critical level every day. This situation causes car manufacturers to reconsider their cost calculations.

Memory crisis also hits cars

General Motors (GM) announced at the meeting where it announced the financial results of the second quarter of the year that vehicle production costs are expected to increase between 1.5 and 2 billion dollars. Paul Jacobson, the company’s financial manager, stated that the basis of this cost increase lies especially in the rise in DRAM memory prices.

GM has previously updated its predictions that vehicle costs will remain stable or decrease slightly this year. The company predicts that new vehicle prices will increase by approximately 0.3 percent in 2026.

The increase in memory costs doesn’t just affect US-based manufacturers. Chinese automotive giant BYD increased the prices of the driver support systems it offers, unlike its vehicles, by 20 percent. South Korean Hyundai, on the other hand, invited domestic semiconductor manufacturers and asked to strengthen the chip supply chain within the country.

Memory becomes critical component of vehicles

Modern cars no longer consist solely of mechanical systems, and memory capacity is rapidly increasing due to infotainment systems, driver assistance technologies and artificial intelligence-based software. According to Micron data, an average car in 2023 would have approximately 90 GB of DRAM and NAND memory.

The company predicts that this amount will increase to an average of 278 GB by 2026, and the total memory capacity may reach 2 TB in upper segment models. Current information shows that infotainment systems use between 4 GB and 16 GB, ADAS and security systems use between 8 GB and 32 GB, and central vehicle computers use between 16 GB and 64 GB.

With the spread of artificial intelligence-based digital assistants, the need for memory is expected to increase further. While it is stated that these systems will require at least 256 GB of memory, it is stated that vehicles with Level 4 autonomous driving will use at least 300 GB of RAM.

Production processes and challenges

There are significant differences between consumer-grade memory chips and those produced for the automotive segment. Automotive-grade memory must go through months or even years of certification processes to withstand harsh conditions such as rain, humidity, extreme temperatures and constant vibration.

When all these factors come together, it is no surprise that the current memory shortage is putting great pressure on the automotive industry. If the crisis deepens, the department may face bottlenecks similar to or more serious than those during the pandemic period.

How long do you think this upward trend in car prices will continue?