The global automotive OTA updates market is projected to reach $13,859.5 million by 2030, growing with a CAGR of 19.5% during the forecast period (2021–2030). With the introduction of portable devices in connected cars, the demand for automotive networking, navigation, connectivity, and entertainment features has increased. Thus, in addition to in-vehicle applications, the on-board instruments and infotainment systems are also being upgraded with enhanced features.
The COVID-19 pandemic has generated a sense of fear and chaos among customers and lowered their willingness to embrace new technology. Furthermore, the lockdown led to unemployment all over the world, which made people think twice before buying something. It was one of the major factors behind the plummeting sales of automobiles. However, it is expected that post COVID, the automotive OTA updates market would witness considerable growth because of the surge in the demand for digital services and advanced features in automobiles, such as cars with digital keys and gesture control and virtual assistants.
The automotive OTA updates market is categorized into passenger vehicle and commercial vehicle, based on vehicle type. Among these, the faster growth in the market during the forecast period is expected from commercial vehicles, as they are widely used for the transportation of goods. Moreover, government mandates for the integration of vehicle tracking systems in commercial vehicles are expected to significantly increase the adoption of OTA (over-the-air) software update solutions in this category.
The automotive OTA updates market is categorized based on application into telematics control unit (TCU), infotainment system, electronic control unit (ECU), and others. Among these, the TCU category generated the highest revenue in 2020 owing to the rising integration of functionalities such as wireless monitoring, diagnostics, communication to/from the vehicle, eCall crash warning, electronic tolling, and vehicle tracking, which are all managed by this integrated onboard device. As a result, the need to regularly update the software of the TCU is rising.
Geographically, Asia-Pacific (APAC) is expected to witness the fastest growth during the forecast period. This can be attributed to the stringent government regulations regarding the integration of advanced safety features, such as intelligent speed assistance, emergency stop signals, and event data recorders, coupled with the increasing demand for autonomous vehicles, connected cars, and shared electric mobility in the region. The adoption of connected cars in APAC is being boosted by the rising disposable income and advancing technological knowledge of customers. Thus, the increase in the demand for cars with advanced connectivity and infotainment features would further enhance the regional market growth.
In recent years, key players actively involved themselves in strategic developments, such as mergers and acquisitions, while also offering customers improved technology with all the required updates. For instance, in March 2019, DENSO CORP. acquired a stake worth $5 million in Airbiquity Inc. The acquisition was intended to accelerate the development of OTA systems for wirelessly updating automotive software from a remote location.
Similarly, in January 2019, Aptiv PLC entered into a partnership with Affectiva Inc. in order to deliver scalable software, including OTA software, derived from deep learning architectures, to enhance the perception capabilities in advanced safety solutions and improve the in-cabin experience.
Some of the major players in the market are Robert Bosch GmbH, DENSO CORP., NXP Semiconductors N.V., Infineon Technologies AG, Continental AG, Verizon Communications Inc., Qualcomm Incorporated, AT&T Inc., HARMAN International Industries Inc., and Aptiv PLC.