[Asia Economy Reporter Jeong Hyunjin] Samsung Electro-Mechanics is driving its "automotive electronics drive" to raise the proportion of automotive-related sales to double digits within five years. After boosting its core product, multilayer ceramic capacitors (MLCC), to firmly establish its automotive business, the company plans to expand into the camera module business, expecting rapid growth in automotive-related sales.
According to industry sources on the 26th, Samsung Electro-Mechanics stated in its recently released sustainability management report that it is pursuing business expansion with the goal of achieving more than 10% of sales from automotive electronics by 2026. The company aims to increase the currently single-digit automotive sales ratio, grow its market share in this high-growth sector, and diversify its business portfolio.
Samsung Electro-Mechanics explained, "The electronics components industry may be affected by difficulties in securing raw materials due to rising protectionism and strengthened eco-friendly policies in major countries, as well as export restrictions. We will focus on material development, securing mid- to long-term supply plans, company-wide digital transformation activities, and developing new technologies and products such as MLCC and cameras to expand entry into the electric vehicle (EV) and eco-friendly industries."
Alongside its core IT components business, Samsung Electro-Mechanics has concentrated on developing automotive-related products and entering the market as part of its new business initiatives for several years. Currently, it develops and manufactures various automotive MLCCs, including those for anti-lock braking systems (ABS), advanced driver-assistance systems (ADAS), and powertrain MLCCs, holding the world's second-largest competitiveness in the MLCC sector. Since 2018, the company has built a new MLCC factory in Tianjin, China, and began pilot production of automotive MLCCs at the end of last year, increasing volume this year. The market expects full-scale operation to start by next year at the latest, leading to increased automotive sales.
This outlook comes as Samsung Electro-Mechanics' automotive products gain reliability in the automotive market. The company announced that it received the "Global Excellent Supplier Award" from Bosch, the world's largest automotive parts manufacturer, the only Korean company to do so. Out of approximately 23,000 suppliers worldwide, 46 companies were selected, including Samsung Electro-Mechanics. Its automotive MLCCs are known for industry-leading product lifespan, stability, and dielectric strength.
Samsung Electro-Mechanics is also expanding its automotive business beyond MLCCs to camera modules. Recently, it signed a supply contract with a global electric vehicle manufacturer to provide camera modules for the pickup truck model, which is the company's next-generation strategic vehicle. Although detailed information has not been disclosed, the order size is reported to be around 500 billion KRW.
A Samsung Electro-Mechanics official said, "The automotive MLCC business has now entered full-scale operation, and we will secure product development and production capabilities to expand partnerships with second and third companies like Bosch. We are strengthening the lineup of high value-added automotive products such as automotive camera modules."
Meanwhile, Samsung Electro-Mechanics will announce its second-quarter earnings on the 28th. The securities industry estimates an operating profit of about 320 billion KRW, more than 200% higher than the same period last year.
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