March 29, 2009 – As the economy slogs along, big-ticket consumer purchases such as cars have dried up — car shipments slipped 8% in 2008 and are expected to sink 19% in 2009. And that’s bad news for, among others, suppliers of automotive electronics, notes iSuppli in a recent report.
A notable casualty of the hurting auto sector are MEMS sensor suppliers, whose technology is used for applications such as vehicle stability control, airbags, and satellites. MEMS sensor companies saw sales decay more than the actual auto industry in 2008 (6%-15%). Systron Donner Automotive, the world’s second-largest supplier of car quartz MEMS gyroscopes (behind Bosch), was shut down by French parent Schneider Electric, laying off all engineers and leaving a skeleton crew to meet contractual commitments.
“This is major turnaround for a company that sold nearly $105 million worth of MEMS vehicle dynamics gyroscopes in 2008,” noted Richard Dixon, iSuppli senior analyst for MEMS, in a statement. “The company was under competitive siege and already was beginning to lose market share at its key long-time customer, Continental, to Panasonic, which is offering a cheaper product.”
Meanwhile, Infineon has said it wants to sell off its Norwegian unit Sensonor to private investors. “The recent downturn … has especially hit the market for tire pressure monitors sensors (TPMS),” Dixon said. Shedding the unit “will help balance Infineon’s books in the short term and has little impact on its market-leading position.” Some process steps done in SensoNor’s site in Horten, Norway, will be merged with Infineon’s TPMS production in Austria, simplifying the supply chain, he said. “But the major impact is to Infineon’s capability to innovate, as the SensoNor group represented an R&D team par excellence.”
MEMS market in US $M for automotive applications, 2006-2013. (Image source: iSuppli)
Overall, though, iSuppli is bullish on the auto MEMS sector, forecasting a return to “healthy” growth in 2010, and double-digit revenue growth in 2011. The firm points to government mandates for multiple MEMS-driven capabilities such as gyroscopes, accelerometers, and pressure sensors for tires and brakes — systems that will be mandatory on vehicles in the US starting in 2012, and in the EU starting 2014.