Connected Car Market Outlook by Service (Driver Assistance, Entertainment, Vehicle Safety, Mobility Management, Fleet Management), Technology (2G/3G, 4G/ LTE, 5G), Application (Navigation, Infotainment, Telematics), Connectivity (Embedded, Integrated, Tethered), End Use (OEM, Aftermarket) - Global Industry Revenue Estimation and Demand Forecast to 2030

Market Overview

The global connected car market size stood is estimated to be $64,061 million in 2022, and it is expected to advance at a compound annual growth rate of 18.30% during 2022–2030, to reach $245,739 million by 2030.

This growth can be primarily ascribed to the increasing demand for high-end luxury cars, surging adoption of the internet of things in the automotive industry, surging preference for automatic parking, autonomous vehicles, and integrated connectivity; 5G penetration, and growing concerns over vehicular safety and security.

Driver Assistance Generating Highest Revenue in Market

The driver assistance service category is expected to hold the largest market share during the forecast period. This dominance is mainly due to the large-scale integration of advanced driver assistance systems in automobiles, which reduce car accident possibilities. Moreover, people’s concerns over vehicular safety is boosting the market. In addition, in various countries, the government has made the installation of the ADAS system mandatory in all upcoming vehicles. Key ADAS applications are automatic emergency braking, pedestrian detection, surround view, and parking assist.

For instance, in India, the Union Ministry for Road Transport and Highways has mandated advanced driver assist systems in all cars from 2022 onward. Moreover, in 2022, the ministry has mandated a minimum of six airbags in passenger cars from October 1, 2023.

Moreover, in June 2022, Qualcomm Technologies Inc. expanded its relationship with PATEO Corporation to build Next-Generation Qinggan Intelligent Cockpit Platform Solutions, such as intelligence, smart car connectivity, service-oriented architecture (SOA), and intelligent cockpits and multi-domain fusion, based on central controllers.

5G Category Is Predicted To Grow Fastest

The 5G category is expected to grow at a significant CAGR throughout the projection period. Many telecommunication enterprises are focused on the development of 5G connectivity for enhanced communication between connected automobiles and external gadgets. The growth can be primarily ascribed to the increasing demand for information in the vehicle, where 5G reduces the latency time, and surging focus to enhance the driver’s experience by providing real-time traffic coverage. Nowadays, 5G technology is increasingly being used in every automobile manufacturing operation, such as automated factory parking, in which automobiles are automatically moved across production areas and logistics hubs.

Additionally, 5G technology permits consumers to quickly download files over a wireless network and provides enhanced high voice quality, ease in usage of IM, social networks, streaming media, and video calling and higher bandwidth.

Original Equipment Manufacturers (OEMs) To Hold Larger Share

The OEM category is expected to hold the largest market share in the coming years. This is because of the elevating requirement for these solutions by the OEMs on account of the implementation of strict government rules regarding automobile and passenger safety. In addition, the demand for advanced technologies, such as integrated connectivity, cybersecurity, and self-drive cars, is rapidly growing.

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Navigation Is Expected To Experience Fastest Growth

The navigation application category is expected to grow at a CAGR of 20.3% and maintain its dominance throughout the projection period. The main growth elements for the category are the growing requirement for real-time in-vehicle navigation and improved optimization with proper route planning features, for a hassle-free journey. Along with this, many people use their mobile phones as a navigator, and sometimes, phone calls divert the attention of the driver, which could cause an accident.

Moreover, many automobile manufacturers offer pre-installed navigation systems in their cars, which use GPS to track the current position of the user on the road. However, vehicles without GPS navigation systems may install a custom navigation device.

The infotainment category is expected to hold the significant market share during the forecast period. The category is growing due to the rising need for enhanced driving experiences, made possible by a host of entertainment options. Moreover, the infotainment system is a basic demand of every customer, which is why most of the key companies are providing inbuilt infotainment systems.

Asia-Pacific Is Most-Lucrative Regional Market

The APAC region is expected to grow at the highest CAGR, of 19.1%, throughout the projection period. This is because of the surging demand for cost-effective, integrated connected systems in cars and the growing popularity of digital services, such as cybersecurity and 5G.

In addition, India is the fastest-growing car market in APAC region. The Indian automobile industry has seen a major shift from household brands, such as Fiat Padmini Premium, HM Ambassador, and Maruti 800, to those of international OEMs. According to the Federation of Automobile Dealers Associations (FADA), in the country in 2022, Maruti Suzuki holds a 39.17% market share and reported a retail sale of 98,318 units in July, while Hyundai had a 15.96% market share with 40,056 units sales. Moreover, in April 2022, Tata Motors announced plans to invest $3.08 billion (INR 24,000 crore) in its passenger vehicle in the next five years.

Similarly, in China, more than 20 million cars were sold in 2021, which is almost 5% hike from the previous year.

Emergence of Artificial Intelligence (AI)

The emergence of AI interfaces is playing an important role in the market. Building upon this technology, automakers are providing cutting-edge in-vehicle infotainment systems, which serve as virtual personal assistants with the ability to respond to voice commands and proactively guide the driver with the help of the navigation system. Moreover, AI radically guides the automotive industry toward innovation, thereby increasing customer satisfaction and enhancing the driving experience. Various automotive OEMs are collaborating with technology vendors to offer their consumers the latest connectivity solutions.

Demand for Enhanced Driving Experiences Is Surging

With the growing urbanization, the need for vehicles for personal and commercial use is increasing significantly. As a result, the world is witnessing a rapid increase in the uptake of vehicles, particularly in emerging economies, such as China, India, and Indonesia. This sudden increase in the number of vehicles on the roads has led to various problems, such as traffic jams, roadblocks, and scarcity of parking space. With the help of advanced connectivity features, these problems can be tackled to a certain extent, resulting in the improvement in the driving experience. Connectivity solutions, such as vehicle-to-vehicle (V2V) and vehicle-to-infrastructure (V2I), can significantly help automotive OEMs in achieving the level of driving experience sought by consumers, thereby driving the growth of the market.

Growing Concern for Safety and Security

The growing concerns for safety and security among OEMs, end users, and governments are one of the major factors driving the global connected car market. Technologies such as ADAS, anti-lock braking systems, and lane assist significantly enhance the driving experience, making the journey safer than ever. Such technologies help in reducing traffic rule violations, in turn, causing a decline in road accidents. The penetration of security and safety solutions in new vehicles is growing. The stringent safety regulations, coupled with a high end user preference for safety features, is expected to drive the ADAS and IoT demand, thereby driving the connected car industry in the coming years.

For instance, in 2021, Morris Garage unveiled SUV Gloster, which is equipped with ADAS features, such as door open warning, rear cross-traffic alert, and lane change assist.

Introduction of IoT in Automotive Industry

Since the incorporation of IoT-based technologies in the automotive industry, the face of mobility has changed. IoT is helping OEMs achieve path-breaking results pertaining to the connectivity solutions used in connected cars. It is the predominant factor for the overall growth of the market. IoT enables an array of infotainment services and advanced connectivity solutions for drivers. With the rapid incorporation of IoT and its adjacent technologies, IoT services have become an integral part of the connected car industry. The research and development in these technologies, coupled with the design and manufacturing of smart and connected automotive hardware (including miniature sensors and control units), is expected to further drive the market growth in the coming years.

Key Players in Global Connected Car Market Are:

• Robert Bosch GmbH
• DENSO CORP.
• Valeo SA
• NXP Semiconductors N.V.
• Delphi Technologies PLC
• Infineon Technologies AG
• TE Connectivity Ltd.
• Continental AG
• Panasonic Corp.
• ZF Friedrichshafen AG

Market Size Breakdown by Segment

The report analyzes the impact of the major drivers and restraints on the market, to offer accurate market estimations for 2017–2030.

Based on Service

• Driver Assistance
• Entertainment
• Vehicle Safety
• Mobility Management
• Fleet Management

Based on Technology

• 2 generation (G)/3G
• 4G/ long-term evolution (LTE)
• 5G

Based on Application

• Navigation
• Infotainment
• Telematics

Based on Connectivity

• Embedded
• Integrated
• Tethered

Based on End Use

• Original Equipment Manufacturer (OEM)
• Aftermarket

Geographical Analysis

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • U.K.
  • France
  • Italy
  • Spain
• Asia-Pacific
  • Japan
  • China
  • India
  • South Korea
  • Australia
• Latin America, Middle East, and Africa
  • Brazil
  • Mexico
  • U.A.E.