Automotive Display Market Analysis

Automotive Display Market (Global, 2022)

Introduction

The automobile display industry is a key segment in the broader automobile industry, driven by the rising demand for advanced in-car entertainment systems, driver assistance systems and the trend towards vehicle connectivity. As consumers are demanding more intuitive and user-friendly features, manufacturers are investing in display systems that not only enhance the aesthetics of the vehicle but also improve its functionality and safety. High-resolution screens, touch screens and augmented reality features are changing the driving experience, making it more entertaining and more informative. And the shift towards electric and self-driving vehicles will increase the need for advanced display systems that can support new functionality and provide real-time information to both drivers and passengers. The automobile display industry is a complex and fast-moving market, and this dynamic landscape creates both challenges and opportunities for all its players.

PESTLE Analysis

Political

In 2022, the car show business was affected by various political factors. The government was making efforts to regulate the safety and emission standards of cars. For example, the European Union introduced the General Safety Regulations, which required that by 2024 all new cars must be equipped with ADAS. This regulation was expected to affect about 15 million cars a year, and it would lead to a demand for advanced display devices to support ADAS.

Economic

In 2022, the world economy showed a certain variability in the consumer market and the car industry. The car industry, which accounted for about a quarter of world turnover, earned about $2.5 billion. The shortage of semiconductors affected about 10% of world car production, and the price of automobile displays rose by 8% on average due to supply problems. Besides, the rate of inflation in the key markets, such as the United States, rose to a high of 7.5%. This weakened the purchasing power of consumers and affected the sales of automobiles.

Social

In 2022, a growing number of consumers were looking for smart and connected vehicles. In a survey, 65% of consumers said that advanced information systems were the most important purchase criteria for their next vehicle. The demand for high-resolution displays was increasing. In 2022, about 40% of the new car models had a large touch screen.

Technological

The development of the car display market is mainly characterized by the integration of OLED and LCD technology, and by the end of 2022 OLED is expected to account for about 30% of the total display market. It is also noteworthy that the market for AR car displays has developed rapidly, and by 2022, there will be about five million cars with AR functions. The trend shows that the development of car display technology is developing very quickly.

Legal

The prevailing legal trend in 2022 will be a compliance with data protection regulations, especially in the European Union, where the General Data Protection Regulation (GDPR) stipulates strict rules for the treatment of data. In the case of a breach of these regulations, which can result in fines of up to twenty million or four percent of annual turnover, it is therefore crucial that legal compliance in product development is taken into account.

Environmental

In the year 2022, the automobile industry was subject to pressure to reduce its carbon emissions. Electric vehicles accounted for nine percent of the total number of vehicles sold. This had prompted automobile makers to invest in sustainable display technology, with 20 percent of new displays being developed with eco-friendly materials. The companies had made a conscious effort to reduce the carbon footprint of automobiles.

Porter's Five Forces

Threat of New Entrants

The barriers to entry in the automobile display market are moderate because of the substantial investment in equipment and in manufacturing capability. The market is growing and the increasing demand for displays makes it a moderate threat of new entrants.

Bargaining Power of Suppliers

The bargaining power of the suppliers of car displays is relatively low. There are many suppliers of components such as liquid crystal displays, organic light-emitting diodes, and touch screens, and therefore a very competitive environment. Suppliers can easily change suppliers in such a situation, reducing their bargaining power.

Bargaining Power of Buyers

High. The buyers in the automotive display market, including the automobile manufacturers and the original equipment manufacturers, have great bargaining power. The reason is that they buy in large quantities, which means they can demand lower prices or higher quality from suppliers. This forces the suppliers to compete and to meet the needs of buyers.

Threat of Substitutes

The threat of substitutes in the automobile market is moderate. Despite the fact that advanced technology such as heads-up displays and augmented reality are replacing the traditional display, the demand for automobile displays remains high. However, as these advanced technologies develop, the threat of substitutes will increase.

Competitive Rivalry

Competition in the market for automobile lighting is intense, as there are several established competitors and new entrants. In order to gain market share, companies are constantly improving their products and lowering their prices.

SWOT Analysis

Strengths

• Rapid technological advancements in display technologies such as OLED and LCD.
• Increasing demand for advanced driver-assistance systems (ADAS) that require high-quality displays.
• Growing consumer preference for connected and smart vehicles with integrated infotainment systems.

Weaknesses

• High manufacturing costs associated with advanced display technologies.
• Limited compatibility of new display technologies with older vehicle models.
• Potential supply chain disruptions affecting the availability of key components.

Opportunities

• Expansion of electric vehicles (EVs) which often feature advanced display systems.
• Rising demand for augmented reality (AR) displays in automotive applications.
• Potential for partnerships with tech companies to enhance display functionalities.

Threats

• Intense competition among display manufacturers leading to price wars.
• Rapid changes in consumer preferences and technology trends.
• Regulatory challenges related to safety and environmental standards.

Summary

The global automotive display market is expected to grow at a CAGR of more than 6% during the forecast period of 2022. The market is expected to be driven by high manufacturing costs and supply chain issues. Opportunities for growth lie in the emergence of the electric vehicle industry and the integration of augmented reality technology. However, competition and regulations may affect the market. Strategic innovation and cooperation are essential for companies to survive in this changing environment.