Driving ST's auto IC strategy: Manufacturing line can't stop

Bolaji Ojo, EETimes
7/23/2012 1:15 PM EDT

GENEVA, Switzerland – STMicroelectronics executives consider its automotive semiconductor business to be one of its most stable and predictable business segments. It accounted for about 17 percent of the company's $9.6 billion revenue in 2011 and is growing at a double-digit clip even as other divisions are struggling with negative growth.

Major structural changes occurring in the automotive market and the increasing adoption of electronics by auto OEMs gives ST and auto IC rivals hope that market strength can be maintained. With mega trends like energy savings, automation, renewable energy and safety identified, auto suppliers must remain agile. Indeed, customers are requiring more of chip suppliers as the trend towards system-level support in places like China and India, combined with the variations in components demand for vehicles, means companies like ST must simultaneously boost R&D spending while holding down costs.

Meanwhile, suppliers like ST understand that auto makers can't afford to shut down production lines because of supply chain snafus.

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