Growth in downstream markets has led to a revival in demand for Canadian automobile electronics.
New York, NY (PRWEB) August 15, 2014
The Automobile Electronics Manufacturing industry performed well during the past two years, after struggling since 2008. From 2008 to 2010, the industry was severely negatively affected by the Canadian and US automotive crisis, in which downstream demand for industry products declined sharply due to the financial troubles of North America's major auto manufacturing companies. However, according to IBISWorld Industry Analyst Zachary Harris, “subsequent growth in downstream markets has led to a revival in demand for Canadian automobile electronics.” As a result, while industry revenue was mostly stagnant or negative in the recent past, the industry grew strongly in 2013 and is expected to continue expanding in 2014. IBISWorld estimates industry revenue has grown at an annualized rate over the five years to 2014. In 2014, industry revenue is anticipated to grow.
The Automobile Electronics Manufacturing industry's performance over the past five years has been mostly linked to the fortunes of US and Canadian automobile manufacturing sectors, which represent the industry's most important downstream markets. These sectors struggled from 2008 to 2010, but have performed well in subsequent years as growth in consumer spending (due to higher levels of per capita disposable income) and government bailouts helped North America's Big Three (GM, Chrysler and Ford) emerge from the recession in healthy financial shape. “As North American motor vehicle sales have expanded, automakers have increased their demand for automobile electronics for use as inputs in their own production,” says Harris. While this has led to revenue growth, the industry has also been confronted with greater import competition, primarily from low-cost East Asian manufacturers. Exports to the US have increased as well, although they have been limited by an appreciation of the Canadian dollar relative to the US dollar.
The Automobile Electronics Manufacturing industry has a high level of industry concentration, with the industry's top four companies are expected to account for the majority of industry revenue in 2014. The Automobile Electronics Manufacturing industry is expected to perform even better over the five years to 2019. While competition from imports is expected to increase, continued growth in Canadian and US automobile manufacturing sectors is expected to increase demand for industry products. In addition, industry exports are expected to increase as the Canadian dollar depreciates and the CETA treaty with the European Union is implemented (probably in 2015). IBISWorld expects industry revenue to grow significantly at an annualized rate over the five years to 2019.
For more information, visit IBISWorld’s Automobile Electronics Manufacturing in Canada industry report page.
Follow IBISWorld on Twitter: https://twitter.com/#!/IBISWorld.
Friend IBISWorld on Facebook: http://www.facebook.com/pages/IBISWorld/121347533189.
IBISWorld industry Report Key Topics
The Automobile Electronics Manufacturing industry is primarily engaged in manufacturing and rebuilding electrical and electronic equipment for motor vehicles and internal combustion engines. Industry operators include manufacturers of lighting systems, electrical wiring, electrical control units, sensors, electronic ignition systems, driver displays and other electrical and electronic equipment. Manufacturers of electric motors are excluded.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US and Canadian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.