Electronic Content Drives Demand for Automotive Microcontrollers

The increased demand of microcontrollers results from the proliferation of electronic content in automobiles aimed at reducing human errors as well as the growing number of automobile safety features such as additional radars, ultra sonic sensors, cameras, and automatic parking assistance. Moreover, the introduction of multiplexing in the automotive industry has triggered sales of high performance microcontrollers by amplifying the need for additional processing power and intelligence.

New analysis from Frost & Sullivan, World Markets for Microcontrollers in Automotives, finds that the market earned revenues of $5.83 billion in 2006 and estimates this to reach $9.52 billion in 2010.

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“After a complete industry makeover, the market for automotive microcontrollers expects to witness tremendous growth over the next few years primarily due to the growth of end-user markets and expanding applications of integrated circuits (ICs) in automobiles,” notes Frost & Sullivan Senior Research Analyst Bonnie Varghese K.

In addition to the increase in multiplexing, the sales growth for hybrids and electric vehicles will likely drive the microcontroller market. Overall, increasing automobile sales, especially in the Asian sub continent, drive the microcontrollers market to greater heights.

Moreover, the oil crisis and pollution control have forced power train applications to include stringent methods for controlling emissions and fuel combustion. Since these applications utilize microcontrollers to process information, these environmental and government regulations will spur microcontroller growth. The European region in particular will generate substantial revenues due to early technological acceptance and government regulations.

However, the strong quality requirements and extensive quality certifications required for product introductions pose a challenge for manufacturers across the globe. This adversely affects lower bit microcontroller manufacturers who lose their market shares to higher bit microcontrollers. Lower bit microcontroller manufacturers can make a comeback by focusing on developing countries with high growth potential.

“Rather than diverting attention to various technologies and protocols, manufacturers can concentrate on fewer technologies which will likely prove more advantageous for marketing and business,” notes Varghese. “Automotive microcontroller manufacturers must also deal with matching the performance requirements with cost of the product and increasing the acceptance of the latest architectures to secure substantial market share.”

Lastly, automotive manufacturers can increase their revenues by working with semiconductor manufacturers to clearly identify their difficulties. This collaboration helps reduce the gap between the expected solution and the actual solution provided. By improving cooperation, the lead-time for new technology adoption can drastically reduce due to the higher level of confidence among automotive and semiconductor manufacturers.

World Markets for Microcontrollers in Automotives is part of the Semiconductors Growth Partnership Service program, which also includes research in the following markets: World Markets for ASICs in Automobiles, World Markets for Discrete Power Semiconductors in Automobiles, and World Automobile ASIC ASSP and FPGA Markets. All research services included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants. Interviews with the press are available.

Frost & Sullivan, a global growth consulting company, has been partnering with clients to support the development of innovative strategies for more than 40 years. The company’s industry expertise integrates growth consulting, growth partnership service, and corporate management training to identify and develop opportunities. Frost & Sullivan serves an extensive clientele that includes Global 1000 companies, emerging companies, and the investment community by providing comprehensive industry coverage that reflects a unique global perspective and combines ongoing analysis of markets, technologies, econometrics, and demographics.