Automotive Innovations within the electronics industry

NEWS

Electronics in "Ultra Low Cost Cars"

Challenges and opportunities for suppliers of automotive electronics and semiconductors

electronica automotive conference on November 10 and 11, 2008 at the Munich International Congress Center (ICM): Platform for decision-makers from the international automobile industry
For example with the talk entitled “Ultra Low Cost Cars – Opportunities and Challenges” on the trend towards cheap cars and its impacts on the automobile electronics market
Unique link between the conference and the world’s leading trade fair: electronica 2008 (November 11 to 14, 2008) with around 1,200 exhibitors for automobile electronics

The nano age has begun - also in the automobile sector. The era of “ultra low cost cars” was ushered in at the latest at the start of 2008 through the launch of the Tata Nano, the “One Lakh Car“ (“100,000 rupee vehicle”) from Tata Motors. Especially due to the enormous demand in fast-developing countries such as China and India, the niche product of cheap cars has become an automobile segment with a promising future. The effects of this and other market developments on the electronics industry will be demonstrated during the electronica automotive conference in Munich on November 10 and 11, 2008. One highlight on the subject of “ultra low cost cars” will be the talk entitled “Ultra Low Cost Cars – Opportunities and Challenges” by Ian Riches, Head of “Global Automotive Practice” at the market research institute Strategy Analytics.

Strategy Analytics is predicting a great future for “ultra low cost cars“, i.e. cars costing between $2,000 and $5,000. Whereas the market for “normal” vehicles weighing less than 3.5 tonnes in the now normal price segments will only grow moderately by an average of 3% per annum between 2010 and 2015, the market for “ultra low cost cars” will almost explode with an annual growth rate of 25%. In 2015 almost 7 million vehicles will be produced in the low-price segment. This automobile sector is being nurtured by the increasing demand, in particular, in the fast-developing countries of China and India. India, for example, occupies third place in the world automobile business league table after the USA and China. Small cars are the most important segment on this market with a share of around 75% in a total market volume of around 1.15 million cars (2007/2008), which will rise to 2.1 million by the end of 2009/2010 according to estimates by Frost & Sullivan. By offering affordable vehicles, automobile manufacturers are tapping into the customer category in the ever expanding middle class and current cyclists.

The “downsize” trend in Asian countries is also having lasting impacts on the automobile electronics market. Although current cheap vehicles such as the Tata only contain very few electronics compared with average European vehicles, the enormous growth in this sector along with increasing use of electronics to comply with emission regulations and satisfy higher customer demands will, according to an estimate by Strategy Analytics, exceed growth on the market as a whole. For example, electronic control units (ECUs) alone in “ultra low cost“ cars will increase on average by 36% per annum between 2010 and 2015, and finally peak at a market volume of more than $2 billion (see graph). By contrast, the total market for ECUs in this 5-year period will only grow on average by a moderate 5% and will amount to a good $72 billion in 2015.

Delegates to the electronica automotive conference will learn about everything that is driving the electronics market in the new cheap car segment, for example during the talk to be given by Ian Riches from Strategy Analytics between 11.30 and 12.00 in the ICM on November 10, 2008. He will describe the future opportunities of automobile electronic suppliers and semiconductor manufacturers in this segment and talk about the applications which will lead the field on the individual markets. Whereas safety systems and hybrid vehicles are generating growth in electronics in established automobile sales countries, simple power train components and comfort and infotainment functions are regarded as key applications in fast-developing countries.

The electronica automotive conference will be an ideal opportunity to obtain and exchange information on this and other important market and technology developments in automotive electronics. Managers and decision-makers from the international automobile industry regard this conference as one of the leading events. Under the title “electronics meets automotive“, experienced speakers from industry and commerce will talk about strategies, trends and technical subjects during the 2-day conference. The speakers will include, for example, experts from BMW, Delphi, Sharp, Valeo, Volvo, ELMOS Semiconductor, Freescale Semiconductor, Panasonic Industrial Europe, STMicroelectronics and Tyco Electronics AMP. At the same time or rather after the conference, electronica - the world’s leading trade fair for electronic components, systems and applications - will provide information on products and services for the automobile industry from November 11 to 14, 2008. A total of around 3,000 exhibitors are expected in 14 exhibition halls during electronica 2008. Approximately 1,200 of these exhibitors will present products and applications relating to automobile electronics. The conference, the trade fair and the “Automotive“ Focus Area in Hall A6, which will include a separate exhibition and talk forum, will combine theory and practice – a worldwide unique opportunity for the automobile industry.

Further information on electronica and the program of the electronica automotive conference can be found in the Internet at: http://www.electronica.de/automotive