Automotive Electronics in China Kept Buzzing by Booming Car Market
2009/10/08 | By CENSThe production value of China's automotive electronic industry made up 13.5% of the global counterpart, with the proportion expected to surge to 18.1% by 2012, according to the statistics released by iSuppli Corp., a technology value-chain research and advisory services provider.
In 2008, the Chinese automotive-electronic market generated an 11.8% year-on-year (YoY) revenue growth, lower than the 34.7% in 2007.
One of the major negative impacts on the 2008 Chinese automotive-electronic market, according to iSuppli, was the declining demand for infotainment systems. In 2007, iSuppli data shows, infotainment systems accounted for 48.7% of the overall market in China, but the share declined to 45.9% in 2008, with such downturn placing many manufacturers in tougher positions.
The global positioning system (GPS) navigation device segment, however, saw clear sales growth in 2008 in the huge Chinese market. The sales of personal (or portable) navigation devices (PND) rose 29.7% YoY, while on-board units (OBUs) increased 19.3%. With rapidly rising popularity of GPS navigation devices, seen to enhance drivers' lifestyles, in China, increasingly more new cars promoted are equipped with such equipment.
Currently, the penetration of GPS OBUs on new cars is about 2%, but the proportion is expected to gradually rise over the next few years driven by the 20% average yearly growth in new car sales in China, which will help to achieve significant volumes of OBUs installed. For example, in 2007 only 960,000 PNDs were sold in China, and the volume more than doubled to 2.31 million in 2008, with the figure expected to jump to 7.57 million by 2012.
Infotainment Potential
In-car infotainment systems, offering both information and entertainment functions onboard, have been the major growth momentum and the most important segment in automotive electronics. In 2007, according to iSuppli, the global automotive infotainment market climbed about 30% YoY to exceed US$7.6 billion, generating 66% of the overall automotive-electronics revenue, with the revenue expected to increase at a compound annual growth rate (CAGR) of 19.2% from 2006 to 2012.
During the transitional period, the market-researcher says, the whole automotive infotainment market in China would focus on audio playback and lower-cost electronic systems.