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News Article

Automotive market remains a bright spot for ICs

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Semiconductor sales rise as higher fuel prices force drivers to switch to 'greener' cars, reports IC Insights
US-based industry analyst IC Insights forecasts the automotive IC market will grow 8% to $19.6 billion in 2012, up from $18.2 billion in 2011, with semiconductor content expected to grow by 11%, year on year, to 2015.

Following the automotive downturn, automakers are now focused on providing user-friendly and relatively low-cost vehicles that also happen to be some of the most technologically advanced vehicles ever produced.

In addition, automakers are shifting more production towards electric vehicles (EVs) and hybrid electric vehicles (HEVs) as "green" initiatives become more prevalent

And ironically, the US $4.00-per-gallon price of gasoline that contributed to Detroit's downfall in 2008 is now supporting new car sales in 2012, as buyers return to showrooms to replace old guzzlers with new, fuel-efficient models.

Given this, IC Insights forecasts the automotive IC market will grow to $27.3 billion in 2015, which represents average annual growth of 11% from 2011-2015.

Semiconductor content per vehicle is forecast to increase to $380 in this year, an increase of 9% from $350 in 2011.

Between 2009 and 2015, annual 11% increases are expected, so by 2015, semiconductor content per vehicle should reach $495 per vehicle.

As IC Insights points out, this suggests that the "trickle-down effect" of technology into lower-priced cars will happen at a faster rate than expected a few years ago and that more "green" vehicles, including hybrids and electric automobiles, will be sold.

Although hybrid-electric and electric vehicles (HEVs and EVs) currently account for less than 2% of total new vehicle shipments worldwide, the semiconductor content per vehicle is much greater in these vehicles. The analyst forecasts that in 2015, full electric vehicles will contain about twice as much semiconductor content as compared to a standard car.
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