Infineon tops automotive market due to rise in power semiconductors in cars

Freescale was earlier ranked as world's number one supplier of semiconductor devices for automotive market. It was also ranked number one in Microcontroller market. Now it pushed to 2nd position in both the markets for different reasons.

In the automotive electronics Freescale is pushed to 2nd spot due to the increased use power semiconductors such as MOSFETs and IGBTs in automotives and also due to weak automotive market in U.S. The rise in the production of electric and hybrid cars is the cause of this change. Power semiconductor devices are the key parts of electrical system controlling the motor of electric and hybrid cars. It's not that the use of MCU has come down, the electric and hybrid cars need more microcontrollers compared to traditional cars. But the traditional cars use far lesser power devices. Freescale is not into power semiconductor domain.

Where as in MCU market, Renesas and NEC have merged their businesses and overtaken the Freescale to become world's number one MCU supplier and also have become world 3rd largest semiconductor chipmaker.

However Freescale has the potential to gain back its number one status in both markets (MCU and automotive) due to the investment it's making in emerging economies like India and China. Particularly Indian car makers can trust more in Freescale compared European and Japanese companies. Companies like Infineon and Renesas work very closely with automotive companies in Europe and Japan respectively with some closed door understanding in providing unique design solutions. They will be in odd situation to provide similar solution to car companies in India.

But the key differentiator more than the geography is the ability of the semiconductor vendor to supply broad range of components such as power devices and also sensors. With no company named above has that broad range of product portfolio there leaves an opportunity for new entry in this market. One name immediately flash to the mind is ST Microelectronics, this jack-of-all company has some unique strengths.

The recent growth of sales of Mercedes cars in China and India clearly indicates both these areas are honey pots for automotive specific semiconductor suppliers. Most important is the success of the car model both in safety and sales. The car's features and safety is now heavily dependent on electronics and components used in the car.