Automotive Electronics Market Size, Share & Trends Analysis Report By Component (ECU, Current Carrying Device, Sensor), By Application (Safety System, ADAS, Body Electronics), By Sales Channel, And Segment Forecasts, 2019 - 2025

Industry Insights

The global automotive electronics market size was valued at USD 230.28 billion in 2018 and is anticipated to expand further at a CAGR of 8.7% during the forecast years. Growing adoption and integration of advanced safety-systems, such as airbags, Automatic Emergency Braking (AEB), and Lane Departure Warning (LDW), are expected to spur the demand for automotive electronics in the next few years. Features, such as accident data recorder systems, alcohol ignition interlocks, and emergency call systems, are also gaining traction and are expected to upkeep the market growth over the forecast period.

OEMs are investing heavily in R&D to develop high-performance products at reasonable cost and are focusing more on energy storage technology. Moreover, the current class of manufacturers have become more reliant on electronics, enabling them to provide high level of safety. In 2010, electronics accounted for around 35% of the total vehicle cost. However, over the next two decades and with the ongoing technological advances, automotive electronics is expected to account for around 50% of the total vehicle cost.

Increasing penetration of Electric Vehicles (EVs) and Hybrid Electric Vehicles (HEVs) is also expected to boost the product demand as it helps reduce the overall vehicle weight, thereby increasing reliability. Furthermore, government regulations to minimize road fatalities, and technological advancements related to in-vehicle safety are boosting the demand for advanced safety systems. In addition, demand for in-car infotainment systems owing to efficiency, comfort, and convenience is estimated to fuel the market growth further.

This has triggered the demand for in-vehicle data storage to support complicated in-vehicle features. This is expected to be one of the key factors driving the automotive infotainment application market. Other application segments, such as body electronics and powertrain, are expected to witness slow growth. The industry is highly dependent on the raw material suppliers and its procurement cost, availability, and delivery. Therefore, strong demand for raw materials can have a substantial influence on manufacturer’s operating costs, thereby, affecting their profit margins.

Manufacturers, such as Delphi Technologies, Denso Corporation, Robert Bosch GmbH, and ZF Friedrichshafen AG, utilize raw materials including aluminum, resin, and copper to manufacture components like ECUs, instrument clusters, electronic switches, body control modules, and immobilizers. Thus, any impact on the supply and cost of the raw materials will directly affect the cost of the final components, thus changing the vehicle cost.

Component Insights

On the basis of component, the market can be categorized into electronic control unit, sensors, current carrying devices, and others. The current carrying devices segment led the market in 2018 owing to high costs and large volumes of electronic switches, fuses, wires installed in vehicles. Also, regulatory pressures on the manufacturers to reduce overall fleet emissions is adding up to production costs. Small-scale manufacturers are also focusing on product innovation, such as reducing vehicle weight by substituting light weight components, to meet the stringent standards.

These regulations primarily focus on the reduction of energy consumption for passenger cars and simultaneously maximizing the sales of new energy vehicles; including plug-in hybrid and fully electric cars. This has resulted in a positive technological shift toward combining various ECU systems into one single unit that can act as a central control unit, thus saving cost and space while improving the fuel emission statistics and vehicle performance. Thus, adoption of such technologies is anticipated to propel the industry growth in future.

Sales Channel Insights

Based on sales channel the industry has been bifurcated into OEM and aftermarket. The OEM segment led the market in 2018. Since, electronic components form an integral part of vehicles and play a vital role in the vehicle performance, consumers prefer to buy these parts through OEMs. Rise in the complexity of these components is owing to the integration electronic switches, and fuses equipped with features, such as latching, low noise, and ultra-miniaturization. These complexities are also expected to complement the dominance of OEMs for the sales channel segment throughout the forecast period.

Application Insights

Based on application, the market has been categorized into ADAS, infotainment, body electronics, safety systems, and powertrain. Safety systems led the market in 2018 and accounted for over 28.43% of overall revenue share. Essential electronics systems used to ensure passenger safety include airbags, on/off switches for airbags, back up sensing system, electro-chromatic mirror/auto dimming mirrors, energy-absorbing steering system, head restraints, heads-up display, padded knee bolster, and passenger sensing system.

Increasing consumer awareness and several initiatives undertaken by the governments across the globe have bolstered the segment growth. Moreover, suppliers, such as Continental AG, along with OEMs are focused on providing low-cost ADAS for the compact and medium-sized car segments. The company introduced affordable ADAS systems, such as driver monitoring systems, traffic sign recognition, and LDW system. Furthermore, New Car Assessment Program (NCAP) in regions, such as Europe and China, has been mandating AEB and LDW systems.

Regional Insights

Asia Pacific market was valued at USD 93.96 billion in 2018. Asian countries, particularly Taiwan, South Korea, Malaysia and Thailand, have significantly contributed towards market growth due the booming electronic component manufacturing industry. Most of the product demand in Asia Pacific is fulfilled by China and Japan. However, the limited number of manufacturers poses an excellent investment opportunity for regional suppliers to capitalize on the local demand, thereby making rest of the region an attractive place for investors.

North America is expected to be the second-largest market. U.S. is expected to dominate the North American regional market over the forecast period owing to higher automotive production and presence of key manufacturers, such as TRW Automotive, Continental Corporation, Robert Bosch GmbH, and Autoliv, Inc., in the country. Strict fuel economy and emission control standards are expected to drive the powertrain electronics market in this region.

Automotive Electronics Market Share Insights

Prominent industry participants include Continental Corporation; Robert Bosch GmbH; Autoliv, Inc.; Samsung Group; Delphi Technologies; Denso Corporation; and ZF Friedrichshafen AG. The market is highly consolidated in nature, since the top two participants acquired around 40% share of the overall market revenue in 2018. To maintain the position in such consolidated market, companies are following strategic initiatives, such as M&A, joint ventures, product launches, and partnerships. Moreover, they also invest heavily in R&D for the development of innovative solutions to gain competitive edge over others.

Report Scope

Segments Covered in the Report

This report forecasts revenue and volume growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2015 to 2025. For the purpose of this study, Grand View Research has segmented the global automotive electronics market report on the basis of component, application, sales channel, and region:

• Component Outlook (Revenue, USD Million, 2015 - 2025)

  • Electronic Control Unit

  • Sensors

  • Current Carrying Devices

  • Others

• Application Outlook (Revenue, USD Million, 2015 - 2025)

  • ADAS

  • Infotainment

  • Body Electronics

  • Safety Systems

  • Powertrain

• Sales Channel Outlook (Revenue, USD Million, 2015 - 2025)

  • OEM

  • Aftermarket

• Regional Outlook (Revenue, USD Million, 2015 - 2025)

  • North America

    • U.S.

    • Canada

  • Europe

    • U.K.

    • Germany

  • Asia Pacific

    • China

    • Japan

    • India

  • Latin America

    • Brazil

    • Mexico

  • Middle East & Africa