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Steady growth seen for automotive chip market

Posted by inet - 2005-10-14

SAN FRANCISCO — The market for automotive-grade semiconductors is expect to reach $16.3 billion this year, an increase of 7.2 percent from 2004, according to a report released Thursday (Oct. 13) by Strategy Analytics.
According to analysis by Strategy Analytics (Boston), planned enhancements to vehicle performance, features and safety will drive automotive semiconductor revenues to $25.7 billion by 2012, ensuring steady growth to automotive semiconductor vendors throughout this decade. This study also found that semiconductor-based sensors will provide the highest growth in demand.

Light vehicle production is expected to grow at a compound annual growth rate (CAGR) of 3.6 percent over the period 2004 to 2009, Strategy Analytics said. The firm expects automotive semiconductor revenues to grow by more than double that rate, 7.8 percent CAGR, over the same period, as vehicle makers introduce electronically controlled innovations in order to meet tightening environmental and safety legislation and respond to consumer expectations of enhanced performance, comfort and infotainment.

"Even in mature electronics application areas, such as powertrain, primary instrumentation and entertainment, there's an incredible amount of semiconductor innovation going on behind the scenes," said Chris Webber, vice president of Strategy Analytics' automotive practice.

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