Frost: Powertrain, Transmission Tech, Safety Demands Promise Growth for Euro Electronic Controllers
July 21, 2008 // Published as a news service by IHS
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The European market for advanced electronic controllers for powertrain, transmission, comfort, driver assist and transmission systems should grow at a compound annual growth rate (CAGR) of 10.9% from 2007 to 2015, according to Frost & Sullivan, driven mainly by the increasing electronic applications within a vehicle and the need for comfort and convenience.
Analysts said the carbon dioxide (CO2) reduction initiative from the European Automobile Manufacturers Association (ACEA) will have a considerable impact on the penetration of hybrids and transmission technologies, such as dual clutch and automated manual transmission.
The European Commission's (EC's) proposal to cut road fatalities in half by 2010 will augment uptake rates of accident prevention and other safety systems.
Recent analysis from Frost & Sullivan of the European automotive advanced electronic controller market found earned revenues of €499.1 million in 2007, with estimates to reach €1.14 billion in 2015.
"OEMs [original equipment manufacturers] are expected to introduce newer applications to differentiate their product offerings in the wake of growing competition," said Frost & Sullivan research analyst Aswin Kumar R. "There is an enhanced need for comfort and convenience among today's European consumers, paralleled by an increased penetration of alternative powertrains from traditional diesel engines in Europe."
The need to abide by stringent safety and eco-norms set by the European Union (EU) will drive the need for higher data processing and more intelligent controllers to manage engine management and safety-related applications.
Analysts said European consumers are still uninformed about the value proposition and inherent safety associated with most of the applications being offered by OEMs. The expanding electronics content in currently available vehicles increases the complexity of the electronic architecture and raises the risk of failure due to the higher level of electromagnetic interference.
"Economies of scale will eventually lead to cost reductions within the manufacturing process," said Kumar. "Prices will only come down with higher volumes, but the demand for certain advanced electronic controllers still remain limited."
To succeed, analysts said OEMs must ensure a faster time to market for advanced applications. This can be achieved by working in partnership with suppliers throughout the value chain.
Source: Frost & Sullivan.