The automotive electronics market is estimated to witness significant growth by 2027 owing to increasing consumer demand for advanced, tech-savvy, and efficient vehicles across the globe.
With the rising prominence of automotive electronics, industry players are capitalizing on market trends to extend their consumer reach across leading markets. For instance, in May 2021, Duckyang, an automotive electronics supplier, announced a $10 million investment towards building its first U.S. facility in Georgia.
The plant is intended to offer battery components to SK Innovation, a company that would provide electric vehicle (EV) batteries to Volkswagen and Ford. Currently, Duckyang supplies cockpit modules to Renault Samsung Motors and Hyundai and its subsidiaries Kia, Mobis, and Genesis.
Moreover, manufacturers are integrating advanced technologies to offer innovative products to customers, thereby improving their market standing. Subsequently, escalating availability of advanced systems is bolstering product demand across the globe. To cite an instance, in June 2021, Dow Inc. presented three new silicone technologies for hybrid and electric vehicle electronics applications.
The three products under the company's DOWSIL tag viz., TC-4551 CV Gap Filler, TC-2035 CV Adhesive, and TC-4060 GB250 Thermal Gel, claim to increase Dow's silicones portfolio to accommodate the changing demands for automotive electrification. These products also offer numerous advanced features, such as high thermal conductivity, controlled volatility, reliable performance, and easy processing for better productivity.
Notably, the automotive sector is focusing on innovations in connectivity, electrification, autonomous driving, and advanced driver assistance, which is a key factor propelling the demand for automotive electronics. Moreover, soaring consumer demand for advanced technologies are prompting manufacturers in the automotive industry to invest in product innovation, which has positively influenced market outlook.
In a recent instance, in June 2021, LG Electronics, the South Korean electronics leader, announced a capital increase for its China-based automotive electronics subsidiary. The capital increase is directed towards supporting the expansion of production lines of parts required for EV powertrains.
For extensive assessment, the automotive electronics market has been segmented based on application, vehicle type, and region. On the basis of application, the market has further been divided into body electronics, ADAS (blind spot detection, adaptive cruise control, automated emergency braking, lane department warning, parking assistance, night vision), infotainment & communication (display, audio, head-up display, navigation, and communication), safety systems, and powertrain (exhaust, transmission drivetrain, engine controllers, xEV).
In 2020, the body electronics sub-segment held over 20% share in the automotive electronics market and is expected to grow at a considerable pace over 2021-2027. Rising trend towards electrification in vehicles, along with the surging consumer preference for high comfort features while driving, is anticipated to contribute to segmental adoption across the globe in the coming years.
In the regional landscape, Latin America accounted for approximately 4% of the automotive electronics market in 2020 and is calculated to expand at a notable CAGR through the forecast timeline. Government initiatives towards accelerating automotive component manufacturing in the region is projected to fuel market adoption through the following years.