With Qualcomm’s acquisition of NXP, Intel’s launch of multiple vehicle gauge processors, and the subsequent acquisition of Israel’s autonomous vehicle technology company Mobileye by MediaTek, automotive electronics will undoubtedly become the next gold mine for semiconductor manufacturers, but how is the global automotive electronics industry changing? What role does China play in this process?
Despite recent reports that shareholders, including Elliott Management, are putting pressure on the board of directors of NXP Semiconductor to renegotiate with Qualcomm and raise the offer price to $110 per share. However, this cannot obscure the bright future of automotive electronics. On the contrary, Enzipp’s proposal to raise the acquisition price shows the great potential of the automotive electronics market. https://www.stoneitech.com/
Special Topics in Automotive Electronics
Environmental protection, safety, and comfort are the core elements that promote the rapid development of automotive electronics. Automotive electronics, including the vehicle body and the entire vehicle, require different technologies to complete, such as automotive safety systems, tire pressure monitoring systems, sensors, ADAS, and so on. Overall, automotive electronics presents several obvious characteristics: 1) 70%
Automotive electronics innovation is the product of automotive electronics or a combination thereof;
2) The proportion of vehicle electronic costs is expected to rise to 50% by 2020;
3) At present, the market scale of medium and low-end vehicles in China is larger than that of high-end vehicles, and the electronic equipment equipped on traditional high-end vehicles is gradually popularized to medium and low-end vehicles;
4) Policies to promote the development of the automotive electronics industry are frequent. With the rapid rise of self-owned brand SUVs, technological innovation, mergers and acquisitions, and joint ventures are the path of localization of automotive electronics.
Classification and industrial chain of automotive electronics
According to the impact on the driving performance of vehicles, automotive electronic products can be divided into two categories: body electronic control system and on-board electronic system.
Vehicle body electronic control system: used in conjunction with the mechanical system on the vehicle, that is, the “electromechanical combination” vehicle electronic device, mainly used in the engine and chassis; It includes power control system, safety control system and body electronic system. For example, electronic fuel injection system, brake anti-lock control, anti-chemical control, traction control, electronically controlled suspension, electronically controlled automatic transmission, electronic steering system, etc.
On-board electronic system: refers to electronic equipment that can be independently used in the vehicle environment. It is not directly related to the driving performance of the vehicle itself. It mainly includes automotive information systems (such as trip computers), satellite navigation systems, automotive audio and video entertainment systems, and automotive communication systems.
Development stage of vehicle body electronic control technology
General Classification of Automotive Electronics
The automotive electronics industry chain is mainly composed of three levels: the upstream is electronic components, the midstream is system integrator, and the downstream is vehicle manufacturer. The upstream component suppliers can also be divided into Tier 2 component suppliers and Tier 3 rear manufacturers. Compared with consumer electronics, automotive electronics has high safety requirements. The industry has multiple certification standards such as TS 16969, ISO 26262, AEC Q100, and the certification cycle is long. It takes about 2 to 3 years for manufacturers to enter the complete vehicle factory supporting system. At present, the automotive electronics industry chain is mainly controlled by several large foreign manufacturers, and the industry concentration is high.
Prospects for the future development of automotive electronics
The trend of automobile electronization is increasingly obvious
The continuous growth of the automotive electronics market and technological innovation have brought better development opportunities for domestic and foreign automotive electronics manufacturers. In 2014, the global auto electronics market scale was 205 billion US dollars, and it is expected that the global auto electronics market scale will exceed 330 billion US dollars by 2020 with a compound growth rate of 8.5% from 2015 to 2020.
As a large country in automobile production and sales, China’s automotive electronics market demand is also growing rapidly, and the market scale is constantly expanding. In 2014, the scale of China’s automotive electronics market was 359.1 billion yuan, reaching 401.24 billion yuan in 2015. It is expected that the global automotive electronics market will grow at a compound growth rate of 11% in 2016-2020, reaching nearly 680 billion yuan in 2020
Scale of China’s automotive electronics market from 2014 to 2020 (100 million yuan)
In recent years, with the increasing application of sensor technology and the gradual penetration of the Internet in automobiles, the trend of automotive electronics has become increasingly evident, with the emergence of highly electronic products represented by Tesla and intelligent products represented by Google’s autonomous vehicles. As a major automobile production and sales country, China’s demand for the automotive electronics market is also growing rapidly. The increasing penetration rate of automotive electronics will drive the steady growth of the automotive electronic component industry, bringing new growth space and development opportunities.
Big companies compete to develop automotive electronics
In recent years, the global automotive semiconductor market has grown rapidly. It is estimated that the global automotive semiconductor market size in 2016 will be US $30 billion, an increase of 6.4% compared to US $28.2 billion in 2015. In addition to Qualcomm’s acquisition of NXP, in November 2016, Samsung Electronics also announced the acquisition of audio giant Harman International Industry for $8 billion, which is also seen as a signal that Samsung Electronics is entering the military vehicle network; In March this year, Intel announced the acquisition of Mobileye, an Israeli technology company. This acquisition is no less important than Qualcomm’s acquisition of NZP. Intel will acquire key technologies for autonomous driving. As the major giants compete for mergers and acquisitions, the industry predicts that Intel
With the development of major chip giants in the field of automotive electronics, it indicates that the development trend of technologies such as intelligent vehicles and the Internet of Vehicles has been established, becoming a major focus for the future development of major manufacturers. For the domestic integrated circuit industry, on the one hand, it conveys the signal and direction of industrial development. In the future, China will also become an important global automotive electronics consumption and application market; On the other hand, the merger and integration among major giants will also bring pressure to relevant integrated circuit design enterprises in China.
In recent years, driven by the National Integrated Circuit Industry Development Promotion Plan and the National Integrated Circuit Plan, the number of integrated circuit design enterprises in China has increased from 736 in 2015 to 1362 in 2016, with an annual increase of over 600. Industrial investment funds. However, it is worth noting that the total sales of all domestic integrated circuit design companies are at the same level as Qualcomm, and many design companies are still in a loss state. In terms of automotive electronics, none of the world’s top ten automotive semiconductor manufacturers was selected by Chinese enterprises in 2016.
In response, experts pointed out that China is the world’s largest automotive production and sales country, but the automotive electronics and semiconductor industries are very weak. Currently, only a few products can enter the global automotive supply chain. However, the development of automotive electronic semiconductors in China has a latecomer advantage. Some leading domestic enterprises are also accelerating the layout of automotive electronic semiconductors recently. With the acceleration of global industry merger and integration, domestic enterprises need to further increase R&D investment and enhance their core technological strength.
