Boston, MA - October 12, 2005 - The new Strategy Analytics study, "Automotive Semiconductor Demand Forecast 2003 - 2012," indicates that the market for automotive grade semiconductors in 2005 will reach $16.3 billion, a year-on-year growth of 7.2 percent. Strategy Analytics analysis shows that 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 CAGR (Compound Annual Growth Rate) of 3.6 percent over the period 2004 to 2009. Over the same period, Strategy Analytics expects automotive semiconductor revenues to grow by more than double that rate at 7.8 percent CAGR, 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," says Chris Webber, Vice President, Automotive Practice.

"Added functions and the growing software content of these systems is driving microcontroller and memory demand. For example, we're seeing the first applications of 64-bit processors in instrumentation and infotainment systems. Sophisticated control and diagnostics requirements are driving integration innovations in analog and smart power ICs. Our analysis shows that a combination of new sensing applications, as well as the migration from passive to active devices will result in semiconductor-based sensors exhibiting the highest component growth rate."