The recent economic crisis has helped provide a massive structural change in the auto industry, which is setting the stage for growth over the next decade. Because of the high barriers to entry and the need for scale economies (in operations, supply chain and marketing), the global auto industry landscape will continue to be a highly concentrated one, with about 10 global automakers accounting for over 77 percent of the production worldwide.
According to statistics, the value of automotive electronic products accounts for roughly one quarter of an automobile's total cost, and, in luxury cars, can account for more than 30 percent of the cost. This proportion continues to rise, and it is expected that the value content of electronic products in a number of luxury cars may soon reach half of the car’s total cost. Databeans projects that the entire automotive semiconductor market will reach $21 billion in global revenue for 2010, an increase of 27 percent over 2009 totals as the automotive industry prepares for a return in new vehicle demand.
IC content, particularly microcontroller-based engine control units (ECUs), is continually increasing. ECUs control most features such as antilock brakes, stability control and even backup warning systems. The average cars contains somewhere between 25 to 35 ECUs per design, while as many as 70 control units can be found on luxury vehicles today. However, the sky is not the limit here, as increasing the number of microcontrollers in a vehicle, also increases the overall system cost and complexity.
The automotive market represents a major piece of the total $13.4 billion microcontrollers market. It is expected to remain the second largest application segment, behind industrial and IC cards, and will experience average growth of 8 percent annually, reaching $7 billion by 2015. The top suppliers of automotive microcontrollers include Freescale, NEC, Renesas, and Microchip Semiconductor.
Databeans
