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PND slowdown minor delay for car infotainment growth in 2013

Posted: 08 Mar 2013 ?? ?Print Version ?Bookmark and Share

Keywords:car infotainment? PND? HDMI? Bluetooth? USB?

IHS has forecasted that the global automotive semiconductor market will continue growing this year. However, due to a slowdown in the aftermarket and portable navigation device (PND) segments, the market will only have to settle for a three per cent increase.

Total semiconductor revenue in 2013 derived from automotive infotainment will reach $6.67 billion, up from $6.48 billion last year, noted IHS. The market will gain momentum with revenue growth of 3-7 per cent each year during the next five years. By 2018, automotive infotainment semiconductor revenue worldwide will amount to $8.54 billion, added the market research firm.

"Despite relatively soft growth this year, the automotive infotainment semiconductor market is set for continued expansion well into the futurefuelled 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 towards 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 six per cent from 2012 to $4.5 billion this year. However some signals of inventory burnout started in 4Q12 also are expected to dampen semiconductor production revenue in 1H13.

Within the automotive infotainment market, PNDs will be the only segment to decline in the coming years. Shipments of the once-popular devices will fall from 33.6 million units last year to 24 million by 2018. Meanwhile, the combined market this year for PND-related analogue and logic application-specific standard product (ASSP) ICs will be down 18 per cent on the year to less than $330 million.

In contrast to PNDs, growth is forecast to take place in various other automotive infotainment segments, including in-dash navigation systems, connectivity in head units, telematics, and both satellite and terrestrial digital radio.

In-dash navigation systems, for instance, will enjoy increased penetration worldwide in vehicle head units, deepening from 19 per cent last year to more than 32 per cent in 2018. Total in-dash silicon revenues in 2013 will reach $290 million, up from $274 million in 2012.

For connectivity systems in head unitsa major trend in infotainmentBluetooth and USB remain the de facto standard for wired and wireless connectivity given a 35 per cent attach rate for each in 2012.

Increased momentum will likewise be found in other technologies aiming to cover high-definition applications, such as HDMI and Mobile High-Definition Link (MHL).

In telematics, General Motors' OnStar and other similar systems continue to have the most mature and widespread market presence. OnStar-type embedded systems hauled in revenue of $480 million last year, with takings by 2018 expected to reach $1.8 billion. Telematics will grow quickly in Europe in the next couple of years as regulations become effective, making features such as eCall mandatory in vehicles for summoning help during emergencies.

Automotive OEMs will also lend increasing support to satellite and terrestrial digital radio systems, such as HD Radio in North America and Digital Audio Broadcasting in Europe. In particular, automotive silicon revenue from terrestrial digital radio formats will rise sharply within a span of six years, climbing from $55 million in 2012 to more than $140 million by 2018.

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