Hansen

The automotive electronics market has been problematic especially for suppliers serving U.S.-based carmakers. Pressure to reduce prices is worse than ever, and the largest customers — GM, Ford and Chrysler — continue to lose market share. Following new labor agreements with the UAW, GM and Ford have been forced back into giving special consideration for new business to their former divisions Delphi and Visteon, which further restricts the market for other suppliers. However, new electronics features as usual will ameliorate such negative trends.

So, what’s hot in electronics? Radar blindspot detection will get hot, particularly if semiconductor suppliers manage to bring inexpensive silicon germanium radar integrated circuits to market. Not waiting for SiGe radar sensors, General Motors will soon issue production orders for a hundred thousand radar blind-spot detection systems per year. Production could start in the 2007 model year.

Satellite radio is pretty hot. Lately, satellite broadcaster XM Radio has been picking up over 110,000 new subscribers per month. In February 2004, XM said it had 1.5 million subscribers and anticipates 2.8 million by the end of 2004. At the end of 2003, XM’s only competitor, Sirius Satellite Radio, had 261,061 subscribers. At the rate XM is adding new subscribers, it should reach breakeven by the end of 2006. So far, Delphi Delco has been the main player in satellite radio production having produced a total of 1.8 million units since market introduction in November 2001.

The TREAD Act, which Congress passed following the Firestone tire recall, is responsible for the hot market for tire pressure monitoring systems. This past summer, tire pressure monitoring received a big boost when the U.S. Court of Appeals ruled out the use of indirect sensing in favor of direct pressure sensing of every tire, including the spare.

According to NHTSA, direct measurement costs $66 per vehicle compared with $31 for the indirect approach, which uses the wheel speed sensors in antilock braking systems to determine if one wheel is spinning faster than the others. Under inflated tires spin faster than properly inflated tires. According to the court ruling, indirect tire measurement is not sufficiently accurate. For example, it doesn’t work if all of the tires are equally under inflated. NHTSA expects to complete the updated regulation, including the phase-in schedule for direct measurement, this year.

Driven by U.S. mandates and by the fact that they save many lives, airbag and seatbelt pretensioner systems continue to get more sophisticated as the number of airbags per vehicle increases and multistage airbags and front passenger position sensors are added. Already in production in Japan, precrash warning sensors anticipate collisions, allowing more time for pretensioners to activate. Head airbags will be particularly helpful in side impact crashes, which kill about 10,000 people in the United States each year.

Electronic stability control systems help drivers avoid crashes by independently controlling skidding at each wheel. ESC will get hot in the United States once consumers begin to believe suppliers’ safety claims. In Japan, Toyota compared the safety records of Toyota models equipped with ESC to similar models without ESC and found that vehicles with it were 35 percent less likely to be involved in single-vehicle accidents and 30 percent less likely to be involved in frontal accidents.

An opportunity for system suppliers: Some carmakers are completely redoing the architecture that underpins their hardware and software systems. With supportive architectures, carmakers will be able to dramatically reduce costs and improve reliability by reusing software and buying common electronic control units and other hardware with standard interfaces. General Motors North America has been working on a common GM architecture, which could be ready for a new platform this decade.

Other promising new products include electric-motor powered steering, electric brakes, diesel engine controls, DVD entertainment systems and video imaging including lane departure warning systems.

Paul Hansen is a strategy consultant in Portsmouth, New Hampshire. He publishes The Hansen Report on Automotive Electronics, a business and technology newsletter. www.hansenreport.com.