Abstract

Traffic Regulations Safety Issues May Cause Drag

While most automotive display devices installed in the before market conform to safety regulations, a high percentage of the devices installed in the after market do not. One example is the installation of audio AV devices in positions where the driver can see them, which can have serious safety implications. Governments throughout the world - notably the US and Hong Kong - have been enacting legislation to combat this problem. However, there are still many countries where the installation of audiovisual AV equipment in the front of the car is not prohibited, including Taiwan, China, Japan, Australia and the European Union.

As the variety of automotive AV products appearing in cars continues to increase, governments can be expected to begin addressing the safety issues more seriously. Prohibiting the use of automotive AV products in the front of cars would have a major impact on market growth. Changes in the regulatory framework will directly affect the operational performance of both existing automotive AV device makers and those system manufacturers and panel makers that are considering expanding into this market. Companies will need to keep an eye on these regulatory changes, so that they can adjust their product mix and sales locations flexibly in such a way as to keep the impact on their operational performance to a minimum.

High Entry Barriers Keep Competitive Pressure Low

Automotive displays play an important role in the driving of the vehicle; this is particularly true of those displays providing information on vehicle speed, fuel status, oil temperature and water temperature, and navigation systems. If the information displayed is unclear or difficult to read, the safety of the car and its occupants could be affected. Industry associations insist on rigorous testing, covering display brightness, contrast, vibration resistance and resistance to heat. Even in the case of automotive audio displays, which do not directly affect driving safety, displays are required to provide brightness of at least 400 cd/m2, to ensure that light from external sources does not degrade the clarity of the image or cause wash-out. Relatively few panel makers are able to meet these rigorous requirements; most of them are Japanese companies, such as Sharp, TMD, NEC, Sanyo and Optrex. However, in the last few years several Taiwanese panel makers have succeeded in breaking into the automotive display market. These companies include AU Optronics, which has successfully developed both the before market and after market, and firms such as Prime View, Hannstar, Chunghwa Picture Tube and Innolux, which have begun to expand into the after market for automotive AV products.

The Chinese After Market

Car production in China has been growing rapidly, boosting demand for automotive AV products. Although China lags behind Europe, the US and Japan in the installation of telematics systems in new cars, demand for in-car navigation systems and automotive AV devices in the after market has shot up. AV system manufacturers will need to collaborate with panel makers to develop medium and low-spec automotive displays for the China market; if successful, they will be able to ride the wave of growth created by the steady increase in car production in China.