Market Insight

Automotive Display Market: Connection and Commitment are Keys for Success

July 31, 2014  | Subscribers Only

Stacy Wu Stacy Wu Principal Analyst, Small Medium Display & Automotive Display

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As the amount of content made available in automotive vehicles increases, the demand for on-board navigation, entertainment (infotainment) systems, and digital instrument clusters is growing exponentially. The use of displays in automobiles is becoming a growing standard and no longer reserved for luxury cars. Center stack display (CSD) and Driver Information Display (DID) are the two major segments for the in-market (installed during vehicle manufacturing phases) automotive display market.

According to 2014 Automotive Display Market Tracker, an IHS report, the attachment rate for TFT-LCD DID displays is forecasted to be 36.1% in 2014 with 30.8 million units and grow to reach an attachemnet rate of 99.6% with 102.8 million units by 2020. The 2014 CSD display attachment rate is expected to be over 50% with 44.9 million units and is expected to grow to reach then become 130.6% (made possible by the use of dual screens) with 131.6 million units in 2020. CSD growth is supported by the US rear view camera mandate that is set to take effect in 2018, which will require a rear-view camera system in all vehicles. Automotive display for sure a highly potential growing market for panel suppliers to investigate.

Unlike consumer electronic applications, automotive displays have a much longer product life cycle, which requires the displays to be highly reliable and stable and warrants higher pricing. The critical success factors for automotive display market are not the inventory management or competitive pricing strategy, but rather strong connections with system integrators (SI) and commitment of quality to last the lifetime of the vehicle.

Tier one SI’s have a high influence on which display panels will be utilized in the industry, while taking on much of the product liability risk and extended support issues. Securing orders and making a connection with these tier one SI’s then becomes a top priority for panel suppliers seeking to enter the automotive display industry. Local sales support and seamless communication will be helpful in enhancing the relations between panel suppliers and tier one SI’s and stablizing the business.

Commitment to quality is another key factor for automotive display panel busines. Unlike consumer electronic devices, automotive display devices need to withstand the lifetime of the vehicle, which can be anywhere from 3 to 10 year. Panel suppliers have to provide minumn 3 years product life in order to meet the requirements of the market. Additionally, to ensure the saftey and reliability of the panel, automotive displays require specifications that can withstand high range of operating temperatures and provide very high brightness levels, and must further go through a rigorous long term qualification procedure. Hence, the key materials of the TFT-LCD panels (liquid crystal, polarizer, and backlights) used in automotive displays are of a higher quality and grade when compared to those same materials used for panels in consumer electronic applications. As a result, majority of the leading automotive display panel suppliers have allocated certain portion of fab production lines dedicated to the manufacturing of automotive panels to ensure that both high quality standards and supply are met.

The automotive display market is undoubtedly a growing star for TFT-LCD panel market but it takes time to penetrate the market. Panel makers will have to reconfigure their strategies from a cost-competitive stance over to a strategy centered on connection and commitment if they seek to make gains in the growing and profitable automotive display industry.

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