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Automotive semicon market dips in 09

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CIOL Bureau
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LONDON, UK: An update for the fourth quarter, conducted by the market research company Gartner, has found that the automotive semiconductor market is expected to fall by 26.5 per cent in 2009 to $14.58 billion, after having dropped by about 5 per cent in 2008 to $19.53 billion.

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A positive growth of 13.5 per cent is likely to be achieved in 2010, when the total available automotive market is expected to reach $16.55 billion. Still, the automotive semiconductor market will have to wait till 2012 to surpass the revenue levels of 2008, when it will reach $20.96 billion, according to Gartner.

The worldwide economic downturn had resulted in considerable slump in sales of new vehicles. There was a sharp drop in the production of vehicles in the last 4 months of 2008 and in the first quarter of 2009. These adversely affected growth in the market for automotive semiconductors, which is closely connected with growth in the production of light vehicles.

According to the update by Gartner, inventory levels corrected to some extent in the first quarter of 2009. While the overall production improved slightly in the second quarter of 2009, the third quarter of 2009 showed strong growth for semiconductor vendors – aided by replenishment of depleted inventories from the earlier months.

The production of vehicles, as a whole, decreased by 4.4 per cent in 2008, Gartner said, adding that it expects a further decline by 19.6 per cent in 2009, owing to the impact of the economic depression on the automotive market. However, this prediction is an improvement on Gartner’s earlier forecast of a 22.7 per cent fall in the production of vehicles and a 30.1 per cent decrease in the automotive semiconductor market.

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