As the applications of connected cars surge rapidly, Lite-On Technology, which has been deeply rooting in the automotive OE (original equipment) market for almost 40 years, aggressively leverages its existing technology advantages and group synergies to move into the development of key products, including ADAS, T-Box, sensor fusion, and DSRC (dedicated short-range communications). With the early results have been achieved, Lite-On is very optimistic about its future growth driven by the brand new opportunities.
A Long-Time Player in the OE Market
Automotive Electronics and Smart Vehicle Applications are the two business units (BUs) that Lite-On has for the car electronics market. Their main products are LED lighting module, camera module, vehicle motor electrical control module, and head-up display, in-car entertainment product, respectively.
According to Michael Wang, GM of Automotive Electronics SBU at Lite-On, the BU was formerly known as Dun Young Technology, which was founded in 1979 and is the first automotive electronics company in Taiwan. Dun Young started its business from manufacturing cruise control system and ECU (electronic control unit) for Chrysler. Unlike most of the Taiwan companies that target at the AM (aftermarket) market, Dun Young has been a long-time player in the OE market ever since its establishment. The long-stand relationship with major car makers and the higher technical barriers have set it apart from the rest of Taiwan's electronics industry.
Take its LED lighting module as an example, the first case that Lite-on won was the adoption by Toyota in 2001. Before that, it took as long as four years for Lite-On to get its products approved. But, the effort bears fruit. With zero DPPM during the four-year product lifetime at Toyota, Lite-On successfully gained reputation in the market and started to expand its business to other car makers. Because of early deployment and widespread adoption, Lite-On now has won 15% shares of worldwide car lighting market, with customers from Europe, the US, Japan, and China. Additionally, it also accounts for 25% shares of the motor control market in China. With its strong competence, the BU has achieved exceptional annual revenue growth over the past five years.
Allen Liao, GM of Smart Vehicle Applications BU at Lite-On also indicated that the predecessor of the BU was PLDS (Philips & Lite-On Digital Solutions Corp.), which specialized in optical disc drive (ODD) products. Because of absorbing the automotive design and manufacturing capabilities from Philips' team in Europe, it has moved into the in-car entertainment market from consumer ODD for a long time, and is the first company that provides wireless charging products for mobile phones in the automotive OE market.
Recently, the BU has expanded its product lines to head-up displays. The new product was delivered to European car makers three years ago, and will be shipped to Japanese and Korean car makers from this year. Similar to Automotive Electronics BU, Smart Vehicle Applications BU also only targets at the OE market.
Exploring New Opportunities with ADAS, T-Box, and more
Regarding the emerging connected car market, Liao said that a smart car is just like a smartphone with four wheels. With this concept in mind, the integration of new technologies into automotive is aimed to address consumers' increasing requirements for entertainment, convenience, and safety. Wang also stressed that the two BUs will work together to develop T-Box, ADAS, sensor fusion, and DSRC products by leveraging Lite-On's strengths in camera module, wireless communications, and optical fields.
T-Box is the first product that Lite-On makes inroads into connected cars. "As many car makers are moving towards this direction, T-Box has great growth potentials because it can provide rich and real-time information as well as services with relative simple designs," Wang pointed out. "It is expected that many new business models and services such as fleet management will be created by deploying T-Box in the future."
Lite-On has already shipped T-Box to a China-Japan joint venture, with around 300,000 units in the early stage. It is estimated that the amount will be increased to 1 million units for the customer's whole product lines. Meanwhile, Lite-On is now in talk with major car makers in Germany and Taiwan.
In the V2V (vehicle to vehicle) communication field, Lite-On has teamed up with Taiwan's ITRI (Industrial Technology Research Institute) to jointly develop DSRC products. According to Tony An, GM of New Business Development & Marketing, DSRC is a wireless communication standard featured with low latency. It is mainly driven by the US and the regulations will be finalized by 2019. Lite-On and ITRI already completes the sample development, and will start testing in the US from next month. As for the China market, which favors to use LTE-based communication technology to enable V2V applications, Lite-On has signed cooperation agreement with China Automotive Technology & Research Center to have early deployment for this.
Regarding ADAS, one of the most promising products in smart cars, Wang said that Automotive Electronics BU is aggressively expanding the business of camera modules, and will work with Smart Vehicle Applications BU to co-develop radar/lidar and sensor fusion technologies, in a bid to build comprehensive ADAS solutions.
Finally, Tony added that the automotive OE market requires longer cycle time for product development. Eyeing on the strong growth potentials in the future, Lite-On has to invest earlier and expand its scale. Therefore, Lite-On announced last year that it will invert over NT$ 10 billion to establish an operation center in Nan-Tze Export Processing Zone. The expansion of production capacity for LED lighting, body control and camera modules will be included in its first-phase plan, as well as the cultivation of RD talents. Moreover, Lite-On actively enhances its global deployment by setting up a RD center in Singapore in the third quarter this year, in an effort to accommodate global talents and extend the opportunities to work with local institutes.
Lite-On, GM of Automotive Electronics SBU, Michael Wang
Lite-On, GM of Smart Vehicle Applications BU, Allen Liao
Lite-On and ITRI jointly develop DSRC products for V2V applications