The old news is that smartphones and tablet PCs continue to be the brightest spots in the semiconductor and electronics industries these days. Thank goodness we have those, along with the emerging economies' new middle-classes and growing enterprise sectors. With sovereign debt mess all over the mature economies, particularly as we continue to watch stalemates in the US and growing concerns in EU, plus additional government/political unrest in the Middle East, it feels like the economic and political situations leave us breathless. Industries and markets are jittery as the wait-and-see over the US continues, and that's the now old-story for so many devices and sectors.
Automotive is, however, a brighter spot, and the increasing penetration rates for semi in autos is an important boost to our industry. As people have become more and more enamored of the ability to continue their connectivity in the car, and as consumers are drawn to autos with an increasing array of built-in electronics, growth continues for autoinfotainment and automotive semis (see here http://www.isuppli.com/Automotive-Infotainment-and-Telematics/MarketWatch/Pages/European-Telematics-OEM-Apps-Area-Must-Have.aspx for an example of iSuppli's recent report on automotive telematics).
Certainly the increased competition in the hybrid electric vehicle (HEV) and electric vehicle (EV) sectors is a boom for semi; these vehicle genres each are significantly heavier in semi content than other vehicles because it is the semi components which are regulating and governing the autos' use of power and efficiency.
Beyond the HEV and EV classes, the latest safety requirements and fuel efficiency standards continue to increase the number of MEMS devices. Accelerometers and pressure sensors continue to be an important part of the MEMS sector as a result of safety mandates. Automotive MEMS represents a 9% CAGR from US $1.89 billion to US $2.5 billion from 2010-2015, according to a recent report briefing by MIG and iSuppli available here.
On-board navigation has, of course been key for automakers although a mixed market challenge for personal navigation device (PND) OEMs, as recently discussed by iSuppli here. But the expansion of the flat-screen within the auto is seeing new opportunities arise as tablet PC competition heats up and demand continues to be strong. Tablets are seen as a likely next generation autoinfotainment device, particularly for backseat passengers, as reviewed here by iSuppli. Pricing is the key holdback at this time, but it is likely that if the CE market continues to soften, and inventory refresh is constrained by OEMs, manufacturers may be keen to explore alternatives for utilizing their lines.
Of course, automotive was significantly hit by the tragic earthquake and tsunami in Japan in March, but despite serious downdrafts due to production halts along the automotive supply chain, there is rebound currently. Automotive semi value chain partners have, for the most part, seen strong results from 2Q11, despite the events in Japan (see here, for example, as EETimes reports on Infineon's recent up quarter due to auto semi numbers but compare to NXP's 3Q11 outlook here).
So what’s the future for auto semis, particularly in light of growing economic uncertainties in the US and EU? Based on some of what we know of auto OEM strategies, demand and localization shifts have eyes and spends on the growth to be had from emerging economies (see this recent report from Manufacturing Business Technology).