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Small Car Boom Hits Short-Term Automotive Electronics Demand
Long Term Growth Healthier - ECU Market to Exceed $63B by 2013
Boston, MA - October 14, 2009 –The Strategy Analytics Automotive Electronics service report, “Automotive System Demand Forecast 2007 to 2016: Small Car Strength Hits Short-Term Electronics Demand,” highlights the impact that the surge in small car market during 2009 has had on the demand for automotive electronics.
Government incentive programs around the world have fueled a one-time boom in the sales of smaller, lower-cost vehicles, as the incentives on offer have typically been for a fixed amount, regardless of purchase price. A $2,000 discount is thus far more attractive on a $10,000 car than a $50,000 one.
“Whereas the period 2002 to 2008 saw a fairly linear rise in average Electronic Control Unit (ECU) content, from around $550 to $650, 2009 will stall at that level because of this unprecedented demand for small cars,” said Ian Riches, Director, Global Automotive Practice. “Future growth looks much better, as the market swings back to its long-term norms and increased electrification in the powertrain boosts electronic content. Strategy Analytics is forecasting average content to hit almost $800 per car in 2013,” he added.
“While some negative effect on profits will be felt by car makers in light of the lower margin on smaller cars, it is the electronic Tier Ones and semiconductor suppliers that are feeling the full impact of this temporary slow down in electronics demand,” commented Chris Webber, VP Global Automotive Practice.
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