China microcontroller market on the rise

A strong industrial sector and the rising sales of consumer gadgets and electronics devices has boosted China’s microcontroller (MCU) market.

According to IHS iSuppli, the boost has given the market the high it needs and as a result it is expected to reach $4.7 billion in revenue by 2015. This is up more than two-thirds from $2.8 billion in 2010.

Government plans designed to stimulate growth in the electronics business helped the China MCU market grow last last year by up 40 percent from the $1.9 billion in 2009.

This, plus other forms of support from Beijing, including a $600 billion investment in the country’s infrastructure and emerging technologies, subsidies for home appliances and automobiles and stimulus programs for green technology, will continue to help boost the industry.

And the government’s meddling has also had a positive effect on the  global economic downturn of late 2008 and 2009 where the MCU industry faced a 12 percent decline.

However, IHS iSuppli said that China should not dwell on the past as currently the only way is up, thanks to upbeat prospects and the fact that the MCU market is “back on a path of solid expansion in the world’s most populous country.”

The largest market for MCUs in China is the industrial sector. In 2010, MCU revenue in this segment amounted to $783 million. This was down to demand from manufacturers in the information management, data processing and communication space, while consumer electronics also surged to become the second largest segment.

Last year MCUs wormed their way into products such as home appliances, televisions, video game consoles and audio systems and they look set to remain – and push the market at a 10 percent compound annual growth rate (CAGR) during the next five years.

The industry that drove the fastest growing segment however was the automotive sector, with revenue rising 82 percent from 2009. In 2010, China’s auto market became the world’s largest region for vehicles, and the country emerged as an important base for producing automotive electronic devices, with 20 percent market share worldwide.

IHS iSuppli claims this sector will achieve a 16.5 percent CAGR from 2011 to 2015.

Others are well aware of how lucrative the microcontroller industry is, including ARM and STMicroelectronics. Back in October the latter launched a range of flash microcontrollers, which it said would help manufacturers increase performance at a cheaper price on their devices

And earlier this year ARM built on its range by announcing two strategic partnerships in the microcontroller (MCU) market with an aim to strengthen ties and develop on the technology.

First to get up close and personal with AMD was NXP, which already uses a number of ARM processors such as the Cortex-M0, Cortex-M3 and Cortex-M4 in its range of microcontrollers. And Fujitsu also got a look in with a bid by ARM to develop new technologies based on its Cortex processors.