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Auto infotainment IC space loses momentum in 2013

Posted: 11 Mar 2013     Print Version  Bookmark and Share

Keywords:infotainment  PND  IHS  automotive market 

The automotive industry will not be as robust as last year. The IHS Automotive Market Tracker Report sees the semiconductor market lose momentum due to a slowdown in the aftermarket and portable navigation device (PND) segments.

The report states that total semiconductor revenue in 2013 derived from automotive infotainment will reach Rs.667.00 crore ($6.67 billion), up 3 percent from Rs.648.00 crore ($6.48 billion). Growth this year will be lower than last year's approximately 4 percent increase. However, an acceleration is expected next year and beyond, with revenue growth of 3 to 7 percent each year during the next five years. By 2018, automotive infotainment semiconductor revenue worldwide will amount to Rs.854.00 crore ($8.54 billion).

Continued growth
"Despite relatively soft growth this year, the automotive infotainment semiconductor market is set for continued expansion well into the future. This growth is fueled by major technology improvements that not only increase the functionality of cars but also improve the overall driving experience," said Luca DeAmbroggi, senior analyst for automotive infotainment at IHS. "The muted growth this year is the result of decreased revenue in the aftermarket sector, where sales are depressed because cars are being sold with more complete infotainment features and systems, reducing the need for consumers to make upgrades. The progress of the market also is being slowed by a continuing decline in the PND segment, as motorists increasingly turn away from dedicated navigation devices and toward smartphone-based solutions."

The drop in aftermarket and PND sales will eat into gains made in semiconductor sales to OEMs, which will rise a projected 6 percent from 2012 to Rs.450.00 crore ($4.5 billion) this year.

However some signals of inventory burnout started in the fourth quarter of 2012 also are expected to dampen semiconductor production revenue in the first half 2013.

Infotainment space unaffected
Despite the reduced speed ahead, the automotive infotainment market overall remains immune to a downturn, unlike other markets that have been negatively affected by global economic uncertainties. The importance of automotive infotainment continues to increase as consumers clamor for built-in connectivity and telematics in cars, which now have become a major selling point of new vehicles. Used either alone or with mobile devices such as smartphones and tablets, the infotainment systems in cars then allow occupants to access information, safety features and entertainment options at will, paving the way for a more seamless interaction with the outside world.


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