The automotive IC market is forecast to increase at an average annual growth rate of 6.7 percent, which is the highest growth among six major end-use IC applications, from 2014 to 2019, according to the latest research from IC Insights. The sector’s strong growth is driven by increasing IC content for systems that assist, automate and communicate, said the market researcher.
The automotive IC sector also will tally more than two points higher than the 4.3 percent CAGR projected for the overall IC industry over the same forecast period. IC Insights attributes some of the strong growth to the smaller base for automotive ICs compared to other segments such as communications, computers, and consumer, and the increase in IC content for both luxury and base model vehicles.
“Systems that provide partial or high automation and that may eventually lead to fully autonomous vehicles are boosting total IC content per automobile,” said IC Insights. “The computation load of next-generation advanced driver assistance systems (ADAS) jumps very quickly with every attempt to widen the sensing range, boost detection precision, and execute more powerful algorithms to respond quickly and effectively to many different driving conditions.”
Despite having the strongest growth rate among the end-use sectors - computer, consumer, communications, automotive, industrial/medical, and government/military - automotive will account for a relatively small piece of the total IC pie.
IC Insights estimates that automotive IC sales will represent 7.3 percent of the total $287.1 billion IC market in 2015, and will account for only 8.1 percent of the total $358.7 billion IC market in 2019. “Falling average selling prices continue to offset steady unit growth—particularly among automotive analog, MCU, and special purpose logic devices—which has mitigated bigger gains in auto’s share of the total IC market,” said IC Insights.
The report also reveals that Asia-Pacific will surpass Europe as the largest regional market for automotive ICs in 2015, and will be the strongest region for automotive IC market growth through 2019 at a CAGR of 10.4 percent.
In terms of product categories, analog ICs (44%) and microcontrollers (30%) will remain the two largest IC categories within the 2015 automotive IC market. However, the automotive memory IC market is forecast to more than double from an estimated $1.6 billion in 2015 to $3.5 billion in 2018.