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Controls/MCUs??

Renesas works out EOL deals to survive the crunch

Posted: 11 Aug 2014 ?? ?Print Version ?Bookmark and Share

Keywords:Renesas? EOL? automotive? Hisao Sakuta?

Sale of Renesas SP Drivers

Renesas's decision this year to unload its stake in Renesas SP Drivers, a fabless supplier of drivers and controllers for liquid crystal displays, wasn't exactly popular. Industry analysts questioned Sakuta's wisdom in this sale, at a time when Renesas SP Drivers' products are designed into Apple's iPhones, making a healthy contribution to Renesas's revenue.

In fact, Renesas SP Drivers is the world's largest maker of small and midsized LCD drivers, holding a 30 per cent share of the market.

Speaking about ending this business, Sakuta said, "Surely, Renesas SP Drivers has been profitable. But my view is that a lot more needs to be done in the LCD drivers of the future." Citing Renesas's commitment to concentrate on automotive and industrial electronics, he added, "I predict Renesas SP Drivers' business will eventually become a little remote island, very little to do with our core businesses. We wouldn't be able to maintain the current share, over the long term."

Sakuta thought it best, he said, to sell the company at its height. Synaptics will purchase all shares of Renesas SP Drivers in October, including those not held by Renesas, for $475 million.

Other businesses and products Renesas is planning to end or withdraw from include optical disc drives, SoC and low-voltage power MOSFET for PCs, LTE modem ICs, secure MCU for mobile handsets, large display driver ICs and home multimedia SoC, and game console SoC business.

Automotive business

Renesas remains the undisputed world leader in the automotive MCU business, with 38 per cent market share. Similarly, the company is tops in the industrial MCU market. Sakuta went out of his way to point out that Renesas holds "more than double the market share of Renesas's closest competitor" (Freescale) in worldwide MCU sales rankings last year, according to Gartner's numbers.

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Figure 2: Renesas is the No. 1 MCU supplier in both the automotive and industrial product categories. Source: Gartner

Maintaining its lead in automotive MCU is Renesas's "most pressing agenda," said Sakuta.

Of Renesas's automotive business, 70 per cent of the company's revenue is generated by chips used in automotive controlsincluding those used in powertrain, chassis/safety, and body. The rest comes from chips used in automotive information/driver assistance. While the advanced driver assistance system (ADAS) market is still emerging, Renesas, thus far, has spoken very little of its products in the offing or its market share.

Asked about the company's automotive strategy, Sakuta said Renesas hopes to add value by ensuring the "functional safety" of its automotive chips, and integrating "security" into its automotive solutions. Renesas's long-running experience in providing security functions to bank cards, for example, should be useful in the automotive solutions, he believes.


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