U.S. Backup-Camera Rule to Double Auto LCD Demand, IHS Predicts

Shipments of liquid crystal displays for use in cars will almost double by 2016 from 2012 levels, as an expected mandate in the U.S. for rear-view cameras in autos boosts demand, researcher IHS forecast.

Deliveries of full-color LCDs used in autos will reach almost 117 million units by 2016, up 89 percent from 2012, El Segundo, California-based IHS said in a report dated Jan. 17. Each year sales will grow between 15 percent and 23 percent, with shipments crossing the hundred-million-unit mark in 2015, according to the report.

“The major driver of growth will be a U.S. government mandate requiring all cars to incorporate rear-view cameras by 2014,” Vinita Jakhanwal, director for small and medium displays at IHS said in the report. Rear-view cameras allow drivers to see directly behind a vehicle, making it easier to back up safely.

The U.S. delayed a planned rule requiring backup cameras in new cars for a third time, with National Highway Traffic Safety Administrator missing a Dec. 31 deadline to issue it. It’s under discussion at the White House’s Office of Management and Budget as one of the most expensive pending U.S. rules, with a stated cost of $2.7 billion. The rule remains “very much” on the table, National Highway Traffic Safety Administrator David Strickland said on Jan. 16.

Sharp Corp. (6753), a Japanese display maker, was among the main suppliers of automotive LCDs last year, the report said. Hsinchu, Taiwan-based AU Optronics Corp. (2409) and LG Display Co. (034220) in South Korea are also increasing production of automotive displays, as they aim to expand presence in the automotive market and benefit from the 10 year supply chain lifetime of auto parts.

Competition within the automotive display market is predicted to intensify during the next five years, according to the IHS report.

To contact the reporter on this story: Rose Kim in Seoul at rkim76@bloomberg.net

To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net

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