BERLIN — The growing momentum among carmakers to turn out low-priced cars in high volume is sending more auto electronics development to lowcost Eastern Europe.

By 2014, electronic system demand in Eastern Europe is expected to reach $11.1B, up nearly 450 percent from $2.5B in 2002, according to Strategy Analytics.

"We are seeing more automotive R&D moving into Eastern Europe and other parts of the world, particularly in the case of software development," said Ian Riches, director of global automotive practice for Strategy Analytics.

In Poland, for example, TRW and Delphi run mega-operations in multiple cities, each company employing about 5000.

"You're not going to see a 7 series BMW designed in Poland any time soon," Riches said. "But the increasing emphasis on lowcost cars for emerging markets require that a degree of auto electronics development be done locally in order to meet cost targets."

In addition, the latest automotive technology developed in Germany and the UK will increasingly collaborate with teams in Eastern Europe.

According to research firm Future Horizons, Toyota, the world's leading carmaker, plans to radically rethink the entire production process and focus on lowcost materials and technology in an effort to create an ultra-lowcost car for emerging markets,

With other carmakers such as India's Tata following, the result is a trend toward lower electronics revenue per vehicle, which could be offset by the potentially higher volumes of semiconductors and systems.

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