The electronics content of motor vehicles—for ignition, engine diagnostics, anti-lock brakes, DVD players, and on-board infotainment—has surged in the last decade. Starting somewhere around 10 percent of the cost of an average vehicle in the early 1990s, electronics content has risen to an estimated 23 percent in 2004. And through 2010, industry sources forecast 7-10% annual growth for electronics content. By the end of the decade, a projected 40 percent of vehicle costs in U.S., European, and Japanese markets will be for electronics and electronics systems. This ascending curve of applications, more than modest increases in vehicle production, means that electronics spending for this segment can ride through recession and economic downturn, logging in reliable growth. Figure 1 depicts the basic situation for this IT market segment. The blue and maroon bars show the slow, fairly choppy growth, of worldwide motor vehicle production, with forecasts to 2010. World motor vehicle production (centered in the U.S., Japan, Europe, Brazil, Korea, and China) grew from 50 million to 60 million units 1994-2003. This is about a two percent annual increase, or slightly more than the annual rate of global population growth. This trend is projected forward to 2010, allowing for slowing in 2005 and 2006.
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