Infineon says its planned $10 billion acquisition of Cypress Semiconductor will produce the world’s largest automotive chip supplier. The acquisition is expected to give the German firm a stronger position in the infotainment and advanced driver assistance systems (ADAS) markets.
In 2018, Infineon ranked second in the global automotive chip business, with $4.2 billion in revenue and a 9.9% share of the global market. U.S.-based Cypress ranked 14th, with total automotive revenue of $808 million and a market share of 1.9%.
The combined companies would have a market share of 11.9% and revenue of $4.9 billion in automotive semiconductors.
Beyond boosting Infineon’s market share, Cypress’ product portfolio expands the company’s offerings into new areas.
“Cypress’s memory capabilities and products represent a major enhancement to Infineon’s automotive portfolio,” said Phil Amsrud, Senior Principal Analyst, Automotive Semiconductors at IHS Markit. “Infineon currently has no memory revenue in automotive, so Cypress’ flash and static random-access memory (SRAM) product lines are completely additive to its product line and capabilities. Moreover, Cypress’ NOR flash products align well with Infineon’s strategy and reputation for offering products that make systems safe and secure.”
Cypress is also offering an emerging memory technology called ferroelectric RAM (F-RAM), which combines the kind of nonvolatile data storage typically associated with NAND flash with the high performance delivered by RAM. These characteristics reportedly make F-RAM suitable for automotive infotainment systems.
The addition of flash memory and SRAM products is expected to augment Infineon’s advanced driver-assistance systems (ADAS) capabilities. With the acquisition of Cypress, Infineon will expand its ADAS offerings and become more relevant to the infotainment segment.
Cypress provides Wi-Fi and Bluetooth experience and products that are key features required in automotive. The acquisition also expands Infineon’s line of power management integrated circuits (PMICs) required for ADAS applications.
The Cypress acquisition also boosts Infineon’s automotive microcontroller (MCU) portfolio and strengthens its third-ranked position in that segment. Cypress’ MCUs are additive to Infineon’s portfolio because they serve a completely different part of the automotive market than Infineon’s Aurix MCU line.
A complete examination of the semiconductor market for automotive electronics, including forecasts for shipments and revenues of more than 200 key semiconductor device categories, is available from the IHS Markit Automotive Semiconductor Intelligence Service. The service also includes competitive analysis of top suppliers and purchasers, as well as a 10-year automotive electronics roadmap.