China's microcontroller (MCU) market is expected to reach US$4.7 billion in revenues by 2015, up more than two-thirds from US$2.8 billion in 2010, according to IHS iSuppli.

"Government plans designed to stimulate growth in the electronics business helped the China MCU market post robust growth last year, up 40% from US$1.9 billion in 2009," said Alex Liu, analyst for China electronics research at IHS. "Those initiatives, along with a strong recovery in spending from consumers and in the industrial sector, will help to expand the China MCU market to US$4.7 billion by 2015. Other forms of support from Beijing include a US$600 billion investment in the country's infrastructure and emerging technologies, subsidies for home appliances and automobiles and stimulus programs for green technology."

The largest market for MCUs in China is the industrial sector, IHS said. In 2010, MCU revenues in this segment amounted to US$783 million, which came from greater requirements of industry equipment for MCUs particularly in information management, data processing and communication.

Consumer electronics also surged to become the second largest segment for MCUs in China, finding their way into products such as home appliances, TVs, video game consoles and audio systems, IHS indicated. As a result, the consumer electronics market for MCUs will rise at a 10% CAGR during the next five years.

While the industrial and consumer segments formed the largest markets, the fastest-growing segment for China MCU consumption in 2010 came from automotive, with revenues rising 82% from 2009, IHS noted. In 2010, China's auto market became the world's largest region for vehicles, and the country emerged as an important base for producing automotive electronic devices, with 20% market share worldwide. With a number of automotive electronics vendors establishing joint ventures and design centers in China, MCU revenues for automotive electronics will achieve a 16.5% CAGR from 2011 to 2015, IHS forecast.

Higher-bit MCUs obtaining traction

The largest market in the foreseeable future for the China MCU market will be the 8-bit devices that are used in the consumer, data processing and industrial segments. However, 8-bit MCUs gradually will lose share in various markets to higher-bit MCUs with their better performance and lower costs, IHS said. Furthermore, frequency conversion technology has been growing in sectors such as green energy and home appliances, which will benefit sales of higher-bit MCUs in the coming years.