China Car Electronics Industry

An Expert's View about Communications Equipment and Parts in China

Posted on: 29 Mar 2010

China’s car electronics industry has been advancing consistently over the past five years and expanding faster than the global automotive semi conductor sector.


Entertainment products contribute significantly to supply and revenue, and in-car GPS devices are showing a positive outlook as well.


Production of most car electronics is thriving on aftermarket sales. The growth of A/V products, however, is attributed to solid OEM business, as more new vehicles are being preinstalled with complete systems.


Certain product segments have suffered a sharp decline in exports in recent months but manufacturers remain confident that China’s overall strong performance will help the line endure the economic slowdown.


The following are some of the key trends observed in China’s car electronics industry as suppliers weather the financial downturn:

• Many companies are turning to the domestic market, where automotive sales have been increasing, to boost their business. Suppliers promoting their own brands are targeting retail channels and the replacement parts sector.

• The growing convergence of electronics, telecom and navigation technologies continues to drive R&D efforts in the car A/V product segment.

• New releases of in-car navigation systems and personal navigation devices have slim form factors, high performance and sensitivity, and multimedia functions.

• Car PCs are evolving into infotainment systems that support various applications, including GPS, multimedia player, rear view camera, and Internet and wireless communications.

• User convenience is the key trend in China’s car security and safety segment. Makers are venturing into wireless car safety electronics in response to strong demand, especially in North America and Europe.

• Car electronic accessories that support various portable gadgets, including iPods, mobile phones and handheld gaming devices, are a fast growing segment in the line. These include FM transmitters and Bluetooth handsfree kits, which have grown to become staple car accessories.

• Companies are enhancing ODM services to shorten design and development time for custom-made models. This allows them to compete more on the basis of functionality than on price, specifically in the low end.

• Cost cutting has limited makers’ product development activities. Some streamline R&D and manufacturing processes to reduce production outlay while decreasing the rate of returns.

• Although some suppliers offer lower quotes, price cuts are limited because of higher labor and component costs.



The above is extracted from the Executive Summary of China Sourcing Report: Car Electronics


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Posted: 29 March 2010

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