Last week contained a big news event for automotive that might have escaped some during the excitement around the new Apple line up. During Apple's World Wide Developer Conference (WWDC) it was announced that Apple has been working closely with nine of the major automotive OEMs to integrate Apple's Siri hands free capabilities in iOS 6 into a "eyes free" voice control system while driving. Autoinfotainment certainly is increasing in what features and capabilities are expected, and soon to be demanded, by today's consumers. The important good news to autoinfotainment increases is the hand-in-hand increase of semiconductor content, recall our discussion on semi growth in the May Commentary piece.
When we consider how, where and why the suite of semiconductors and electronic components are being used in today's vehicles, it suddenly makes sense that the automotive sector today represents nearly one-fifth of the total semiconductor and electronics industry market, almost equal to the share that personal computing holds.
The following list presents a quick and general overview of how and where we are seeing the increase of automotive semiconductor components and demand that is mounting along the supply chain. The most positive aspects are, of course, the market diversification opportunities for semi components.
Auto safety relies heavily on many different MEMS, ICs, MCUs. These components are supporting engine, adaptive and cruise speed control, throttle override systems, tire pressure and rotation sensors, fuel efficiency, emissions monitoring, braking, lane departure, electronic vehicle stability control and anti-roll (differential braking), tracking and anti-theft, impact and airbags (e.g., weight for front seat passengers, etc.), parking assistance, object detection and proximity warning (e.g., rear-mounted camera, blind spots, etc.), battery recharging for charge/discharge and motor control management, driver distraction monitoring and restricted device/features access while driving (impaired driver monitor, connected-device driver restrictions on handheld devices (distracted driving) while in motion), light and rain sensors, etc.
Other MEMS and sensors
MEMS goes beyond safety to provide a full array of driver and passenger comfort and safety features such as: automated and manually adjustable temperature; weight sensors for airbag accelerometer adjustments; navigation and location platforms for destination guidance as well as alerts in the event of accidents; interior lighting and dimming to improve driver vision while allowing passengers to see in the cabin; touch sensors for displays and other in-vehicle control panels; light detection and ranging (LIDAR) for oncoming vehicles; and increased presence of low-cost, complex MEMS integrated sensor packages notably for electronic stability control (based on research from Yole Developpement cited by EETimes);
Displays are among the most in-flux component presently as in-dashboard and front-console displays increasingly adopt touch-screen graphical user interface (GUI) as replacements for, or in addition to, mechanical (knob) user control panels moving from traditional human-machine interfaces (HMI) to GUIs, (see this from EETimes), LED digital gauges, instrument monitors, rear passenger audio-video screens (built in to seat backs or drop down from center ceiling panels). How people interact with the autoinfotainment options in the car is important, especially for the driver whose attention to driving and the road is paramount to safety. Awareness of and the increasing legislation to thwart distracted driving is increasing the reliance on semiconductor components such as Apple's Siri "eyes free" capability to allow for drivers to utilize necessary communication and navigation controls while driving but through voice alone. In the case of the new Siri "eyes free" functionality, the screen on the Apple device (iPhone or iPad) will not illuminate, other OEM devices are likely to have locked modes for those features, such as texting and reading email, while the car is not in Park, to reduce the risk of driver distraction.
Extending optics and the use of cameras has been widely successful for automotive thus far, and this component is set to be leveraged even more, particularly as driver assistance systems begin to see wider market penetration. Cameras are going beyond the initial exterior mounts for parking assistance and proximity warnings to now include robust lane departure warnings, front-facing interior mounts (e.g., in rearview mirror) for advanced driver assistance systems (ADAS) for driving and parking assistance, autonomous vehicle control subsystems (e.g., driverless or robotic vehicles), interior mounts (e.g., windshield) facing driver for driver warning (drowsiness, inattention, sobriety, etc.) and collision avoidance systems. Increasing the number of "eyes" on the road and in the cabin is going to help boost the optics sector and diversify market opportunities at a time when the pocket digital camera is facing challenges from the smartphone market.
Connectivity is perhaps the cornerstone feature that will drive automotive feature differentiation, a critical point in the auto industry. Consumers are becoming more impatient for their cars to support their connectivity needs meaning that there is already an increase of components to support in-car RF, Bluetooth, Wi-Fi, USB, GPS, tracking and telematics, Gigabit Ethernet cabling within the car to connect systems and devices (in progress), in-vehicle smart device integration (see this from EETimes), remote immobilizers (anti-theft), and similar connectivity capabilities.
With the consumer market penetration of LED lightbulbs and the increased adoption of OLED displays, pricing for these lighting solutions has dropped enough to allow for their adoption by price sensitive automotive OEMs. We are seeing significant increases in LED interior and console lighting and automatic dimming for nighttime driving, LED headlights with improved range, radius and oncoming vehicle dimming sensors, LCD, LED and OLED displays for rear passenger video and in-dash/front console (see Audi's exterior OLED experiments in EETimes Europe), to name the most robust subsectors.
Among the important chipset improvements are the integration of components onto single chipsets in order to decrease costs (remembering that automotive is a very cost-sensitive market sector) and provide increased compatibility by providing integrated systems (see EETimes report on Fujitsu's end-to-end embedded SoCs, for example).
Smart EV charging
We cannot round out our list without mentioning the important role that hybrid electric vehicles (HEV) and electric vehicles (EV) are playing today for the wider semiconductor supply chain. Importantly, the HEV and EV auto subsector is growing and along with that increased adoption by consumers and fleets alike, is the increase in automotive semiconductor volume because these vehicles have a far greater semiconductor content ratio than standard vehicles. But beyond the complex ICs required to monitor and control and regenerate power, EVs especially, open the doors to other opportunities for the semiconductor and electronics supply chain. For example, on-the-go recharging is seen as a significant challenge that, when solved, will increase EV market adoption. As a result, there are many joint venture pilot project exploring Vehicle-to-Grid (V2G) connectivity for smart recharging (connects to smart grid). These V2G recharging capabilities offer opportunities for the semi supply chain because of the hardware requiring numerous RF chipsets, sensors, and inter-device compatibility, charging stations (numerous hardware components including inverters, grid and vehicle monitors, etc.), location based signals to send and receive for both smart grid and vehicle alerts, etc.
Microphones & speakers
Coming around to full-circle, Apple's WWDC announcement of Siri "eyes free" capabilities for iOS 6 is not just about the extension of Apple into an iCar moment, it illustrates the demand height that autoinfotainment has reached today. Not only is hands-free driver control of vehicle environment and functions, hands-free Bluetooth smart device use, and emergency connectivity expected by today's drivers, the requirements for safer driving and autoinfortainment controls are increasing. Taken together, the wealth of opportunities for semiconductor and electronics diversification in the automotive market and the demand for differentiation by automotive OEMs along side of the always connected demand from consumers means that semi penetration and diversification are well positioned in the fast lane for growth.