The burgeoning sale of vehicles across the globe is one of the biggest factors fuelling the growth in demand for automotive electronics across the world. Nowadays, automotive electronics contribute to almost 35% cost of an automobile as compared to its 5% contribution in 1970. This contributing share is predicted to rise to 50%, thereby causing huge sales of automotive electronics in the coming years. The Organisation Internationale des Constructeurs d’Automobiles (OICA) expects 95.1 million automotive sales in 2018.
The other key factors boosting the demand for automotive electronics are the increasing implementation of various government initiatives and regulations for making the vehicles safe and fuel-efficient. Powered by these factors, the global automotive electronics market is expected to generate revenue of $615.3 billion by 2030, which is a considerable increase from its valuation of $235.7 billion in 2019. The market is also forecasted to advance at a CAGR of 9.3% during the forecast period (2020—2030).
The various automotive electronics components available in the market are electronic control unit (ECU), current carrying device, and sensor. Amongst these, the current carrying device components registered the highest demand in 2019. This is mainly attributed to the fact that an automobiles consists of nearly 200 electronic switches and fuses and a vehicle cannot function without them. These components are also predicted to record the fastest growth in demand during the forecast period. Sensors are also expected to observe significant growth in demand in the coming years, primarily due to the rising integration of position and temperature sensors in vehicles.
Geographically, the highest demand for automotive electronics was witnessed in the Asia-Pacific (APAC) region in 2019. The main factors responsible for the boom in the sales of automotive electronics in this region are the burgeoning sales of automobiles in countries such as India, China, Japan, and South Korea, owing to the flourishing automotive manufacturing industry and the availability of cheap labour and raw materials in these countries. Moreover, the major automobile manufacturing companies are shifting their manufacturing plants and facilities to these countries, which is further boosting the demand for automotive electronics in the region.
Therefore, owing to the booming automobile manufacturing sector, the rising demand for high-end and luxury vehicles equipped with vehicle safety features and advanced systems and the increasing number of government measures and regulations supporting the development of automotive electronics, the demand for automotive electronics is expected to observed huge upswing in the coming years.