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Here’s how bad it was

John Day

John Day

Posted Apr 28, 2010
1 Comment

Strategy Analytics announced that Infineon edged Freescale in automotive semiconductor revenues last year to take the number one spot. The research firm said Infineon achieved $1.31 billion in revenues for calendar 2009 compared with $1.16 billion for Freescale, amounting to market shares of 9% and 8% respectively.

But Strategy Analytics also said that semiconductor suppliers suffered an average year-on-year revenue decline of 22%, and that each of the top three vendors (STMicroelectronics ranked #3) lost market share in 2009 compared with 2008.

“None of the automotive semiconductor vendors escaped unscathed from the drastic declines in automotive demand precipitated in the latter part of 2008,” according to Chris Webber, vice president of Strategy Analytics’ Global Automotive Practice.

“Automotive semiconductor demand fell in 2009 for an unprecedented second year in a row,” Webber said in a statement. “Infineon’s total automotive revenues fell in both years, but to a lesser degree than Freescale’s. Freescale had the greatest exposure from the North American market, which suffered the greatest regional declines in 2008 and 2009. In 2009 Infineon found some very modest growth from the emerging economic regions, while Freescale’s emerging region revenues declined.”

Webber added that the automotive semiconductor market “virtually ground to a halt in the first quarter of 2009, as falling OEM demand was exacerbated by inventory destocking in the supply chain.” He said the high resurgence in demand that ensued in the third and fourth quarters was too little, too late to avoid significant 2009 revenue declines for all semiconductor vendors.”

Ian Riches, director of Strategy Analytics’ Automotive Electronics Service, said the semiconductor is much brighter now. “Supplier restocking activity and a real recovery in OEM demand will ensure a return to growth for vendors in 2010,” he said. “In the medium and longer term, further growth will be driven by increased electronics penetration, particularly because the industry needs to meet future vehicle environmental and safety requirements.”

Freescale, Ian Riches, Chris Webber, Strategy Analytics, Infineon

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John DayJohn Day recently launched John Day’s Automotive Electronics News (johndayautomotivelectronics.com) to provide news and feature coverage of the automotive electronics industry. Earlier he wrote for Auto Electronics magazine, Auto E-lectronics, EE Times, and other business and engineering publications. Visit John Day

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Comments 1

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, what did the team at Freescale tell you that led you to beviele that splitting the company up would enable them to cast off the negative shadow from their Motorola business culture legacy?It would appear that Freescale's failure to grow is the result of some deep-rooted issues that still aren't being addressed by the current leadership team.My point: ignoring the obvious legacy white elephant in the board room discussions only perpetuates the apparent denial substantive change at Freescale will require more than merely creating smaller, but otherwise equally dysfunctional, independent businesses.

Naomi
4:16 AM Feb 23, 2012

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