Friday, October 16, 2009

Strategy Analytics: Small Car Boom Hits Short-Term Automotive Electronics Demand

Long Term Growth Healthier - ECU Market to Exceed $63B by 2013
BOSTON--(Business Wire)--
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.

About Strategy Analytics

Strategy Analytics, Inc. provides timely and actionable market intelligence
focused on opportunities and disruptive forces in the areas of Automotive
Electronics and Entertainment, Broadband Connected Home, Mobile & Wireless
Intelligent Systems and Virtual Worlds. Headquartered in Boston, MA, with
offices in the UK, France, Germany, Japan, S. Korea and China, Strategy
Analytics works with clients through annual multi-client services, management
team workshops and custom consulting engagements. For more information, please
visit http://www.strategyanalytics.com/

Strategy Analytics, Inc.
US Contact:
Mark Fitzgerald, +1 617 614 0717
mfitzgerald@strategyanalytics.com
or
European Contact:
Ian Riches, +44(0) 1908 423 645
iriches@strategyanalytics.com

Copyright Business Wire 2009

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