The Global Connected Car market is cross USD 190 Billion by 2029 due to rapid technological advancements and increasing demand for connected services
The automotive industry is undergoing a transformative shift, with the integration of cutting-edge technologies giving rise to the era of connected cars. Connected cars, also known as smart cars or Internet of Things (IoT) vehicles, are equipped with advanced communication systems that enable them to interact with the external environment, other vehicles, and infrastructure. This convergence of automotive and technology has paved the way for unprecedented advancements, enhancing safety, efficiency, and overall driving experience. The connected car industry has gained significant traction in recent years, with an increasing number of vehicles incorporating connectivity features. These features range from basic functionalities like GPS navigation and Bluetooth connectivity to more advanced systems such as real-time data monitoring, vehicle-to-everything (V2X) communication, and autonomous driving capabilities. The implementation of 5G networks is a game-changer for the connected car industry. The high-speed, low-latency connectivity offered by 5G enables seamless communication between vehicles, infrastructure, and the cloud, supporting advanced applications such as real-time traffic updates, high-definition mapping, and immersive in-car entertainment. The pursuit of autonomous driving technology is a driving force behind the connected car industry. Vehicles equipped with sensors, cameras, and AI algorithms can navigate and make decisions without human intervention. This not only enhances safety but also opens up new possibilities for mobility services and transportation efficiency. As vehicles become more connected, the need for robust cybersecurity measures becomes paramount. The industry is focusing on developing advanced security protocols to protect connected cars from potential cyber threats, ensuring the integrity of critical systems and safeguarding user data. According to the research report, “Global Connected Car Market Outlook, 2029” published by Bonafide Research, the market is anticipated to cross USD 190 Billion by 2029, increasing from USD 87.14 Billion in 2023. The market is expected to grow with 14.22% CAGR by 2024-29. Connected cars contribute to improved road safety through features like collision detection, automatic emergency braking, and lane departure warnings. These systems leverage sensors and communication networks to anticipate and prevent potential accidents, reducing the number of road fatalities. Telematics systems in connected cars enable the collection and transmission of real-time data related to vehicle performance, fuel efficiency, and maintenance needs. This data is then utilized for remote diagnostics, predictive maintenance, and efficient fleet management, leading to cost savings for both consumers and businesses. Enhanced infotainment systems with internet connectivity have become a standard feature in many modern vehicles. These systems provide passengers with access to streaming services, navigation apps, and social media platforms, transforming the in-car experience. The integration of edge computing in connected cars will enable faster data processing and decision-making directly within the vehicle. This reduces reliance on cloud-based services and enhances the overall responsiveness of connected car systems. Connected cars will play a crucial role in the evolution of smart cities. Through V2X communication, vehicles can share data with traffic signals, parking infrastructure, and other elements of urban mobility, contributing to more efficient traffic flow and reduced congestion. AI-driven personalization will become more prevalent, tailoring the in-car experience to individual preferences. From climate control settings to entertainment recommendations, connected cars will adapt to the unique preferences of each driver and passenger.
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Download SampleMarket Drivers • Advancements in Communication Technologies: The continuous evolution of communication technologies, particularly the rollout of 5G networks, is a major driver for the connected car market. 5G provides high-speed, low-latency connectivity, enabling seamless communication between vehicles and the broader infrastructure. This facilitates real-time data exchange, supporting applications like vehicle-to-vehicle (V2V) communication, enhanced navigation services, and improved overall safety. The increased bandwidth of 5G also enables the handling of massive amounts of data generated by connected cars, paving the way for more sophisticated features and services. • Growing Emphasis on Vehicle Safety and Efficiency: There is a growing global emphasis on enhancing road safety and improving overall transportation efficiency, and connected cars play a pivotal role in achieving these objectives. Advanced driver assistance systems (ADAS) and connected features contribute to safer driving by providing real-time alerts, collision avoidance, and automated emergency response. Telematics and remote diagnostics functionalities help in efficient fleet management, reducing downtime, and optimizing fuel consumption. As regulatory bodies and consumers prioritize safety and efficiency, the demand for connected car solutions is expected to rise. Market Challenges • Cybersecurity Concerns: The increasing connectivity in cars makes them susceptible to cyber threats, posing a significant challenge for the connected car market. As vehicles become more interconnected and rely on software systems, they become potential targets for cyber-attacks. Security breaches could lead to unauthorized access, data manipulation, or even the compromise of critical vehicle functions. Manufacturers must invest in robust cybersecurity measures, including encryption, secure software updates, and intrusion detection systems, to safeguard the integrity of connected car systems and protect user data. • Fragmented Regulatory Landscape: The global connected car market faces challenges due to the lack of standardized regulations across different regions. Each country or region may have its own set of rules and standards for connected car technologies, creating a fragmented regulatory landscape. This lack of uniformity can hinder the seamless integration and deployment of connected car solutions globally. Harmonizing regulations and establishing clear standards for data privacy, cybersecurity, and communication protocols is crucial to fostering a cohesive and interoperable connected car ecosystem. Market Trends • Autonomous Driving and AI Integration: The trend towards autonomous driving is a significant driver for the connected car market. Connected cars are increasingly equipped with advanced driver assistance systems (ADAS) that utilize artificial intelligence (AI) algorithms and machine learning to enable features such as lane-keeping assistance, adaptive cruise control, and automated parking. The integration of AI not only enhances safety but also contributes to the development of fully autonomous vehicles. This trend aligns with the broader industry goal of creating self-driving cars capable of navigating complex environments without human intervention. • Data Monetization and Personalized Services: The vast amount of data generated by connected cars opens up opportunities for data monetization and the delivery of personalized services. Automotive manufacturers and service providers can analyze the data collected from connected cars to offer customized experiences, such as personalized in-car entertainment, targeted advertising, and location-based services. This trend not only enhances the user experience but also creates new revenue streams for stakeholders in the connected car ecosystem. However, it also raises concerns about data privacy, requiring careful consideration of ethical and regulatory frameworks. Covid-19 Impacts The global connected car market relies on complex and interconnected supply chains. The pandemic disrupted manufacturing and supply chain operations worldwide, causing delays in the production and distribution of connected car components. Shortages of essential electronic components and logistical challenges affected the timely delivery of vehicles, leading to a slowdown in production and sales. Economic uncertainties resulting from the pandemic led to reduced consumer spending, impacting the automotive industry, including the connected car market. Consumers deferred or canceled purchases of new vehicles, affecting the adoption of connected car technologies. The economic downturn and financial uncertainties prompted some consumers to prioritize essential expenses over discretionary spending on advanced vehicle features. The pandemic disrupted the deployment and integration of connected car services and technologies. Development projects and collaborations between automotive manufacturers, technology companies, and service providers were delayed or put on hold. The focus shifted towards addressing immediate challenges, diverting resources from long-term innovation and development efforts. Automotive events, conferences, and exhibitions, which play a crucial role in showcasing new technologies and fostering collaborations, were either canceled or moved to virtual platforms. The absence of in-person events limited networking opportunities and slowed down the exchange of ideas and innovations within the connected car industry. The pandemic has altered consumer priorities and preferences, with an increased focus on health, safety, and contactless experiences. While connected car features related to safety and remote monitoring gained importance, non-essential features related to in-car entertainment and luxury experienced reduced demand.
By Technology | 4G/LTE | |
3G | ||
5G | ||
By Connectivity Solutions | Integrated | |
Embedded | ||
Tethered | ||
By Application | Driver Assistance | |
Safety | ||
Infotainment | ||
Telematics | ||
Fleet Management (Vehicle) | ||
Mobility Management | ||
Others | ||
By End Market | Original Equipment Manufacturer (OEMs) | |
Aftermarket | ||
Geography | North America | United States |
Canada | ||
Mexico | ||
Europe | Germany | |
United Kingdom | ||
France | ||
Italy | ||
Spain | ||
Russia | ||
Asia-Pacific | China | |
Japan | ||
India | ||
Australia | ||
South Korea | ||
South America | Brazil | |
MEA | United Arab Emirates |
Based on the technology, the 4G/LTE segment was the highest contributor to the market and is estimated to grow at a prominent CAGR during the forecast period. Leading producers of technologies for automotive manufacturers are collaborating to produce new vehicle tracking technologies to be used in connected cars. For instance, in November 2018, a top positioning and wireless communication technology producer, u-blox, is collaborating with a technology and product developer for the automotive market, ERM Electronic Systems Ltd., to produce an advanced vehicle tracking device that includes 4G and Wi Fi technologies. The development and production of advanced and fast vehicle tracking technologies using 4G and LTE in connected cars fuel the adoption of 4G/LTE technologies in connected cars. Production of automatically connected cars for real-time applications using 4G/LTE technology is a significant growth opportunity for the key players in the market. However, several automobile manufacturers are switching to 5G enabled connected cars solutions that also offer 3G/4G service, depending on the situation. Although 5G-supported connected car devices and services are a bit expensive compared to other devices, their market is experiencing growth due to the fast data transfer speed and increased bandwidth offered. Automobile manufacturers are switching from 4G/LTE enabled connected cars solutions to 5G enabled devices. Yet a car with a 5G-enabled connection can provide multiple valuable services such as telematics, remote control access, infotainment, GPS tracking, and others. These 5G solutions are easy to use, affordable, and facilitate remote diagnostics of a vehicle, giving it an upper hand in the market. Several telecommunication companies are developing advanced 5G networks for better communication between connected vehicles and external devices. According to the 5G Automotive Association, more than 60% of road accidents can be avoided with the help of a seamless 5G network. For instance, South Korea and the EU have partnered to develop a 5G network for local projects by investing more than USD 1.5 billion. This is expected to curb the rising number of road accidents. Integrated connectivity solutions are growing in the connected car market due to the demand for seamless, all-encompassing user experiences that combine safety, entertainment, and efficiency within a unified and interconnected framework. Today's drivers and passengers no longer perceive their vehicles as mere modes of transportation but as extensions of their digital lifestyles. Consequently, there is a growing insistence on a comprehensive and streamlined driving experience that transcends isolated features, encompassing safety, entertainment, navigation, and efficiency in a cohesive manner. Integrated connectivity solutions emerge as a strategic response to this demand, presenting a paradigm where various functionalities are seamlessly intertwined within a unified platform. Consider a connected car equipped with these integrated solutions: it not only provides real-time traffic updates for efficient navigation but also simultaneously offers a diverse array of in-car entertainment options. Meanwhile, it seamlessly integrates advanced driver assistance features, augmenting safety on the road. The beauty of this integrated approach lies in its ability to allow users to transition effortlessly between different facets of their driving experience without encountering the disjointedness often associated with standalone systems. This pursuit of integrated connectivity solutions underscores the industry's recognition of the need for a connected ecosystem that caters to the multifaceted requirements of modern drivers and passengers. Automotive manufacturers and technology providers are fervently developing and refining these integrated solutions, aiming to create a unified and intuitive driving experience that goes beyond individual features. Driver assistance applications are witnessing growth in the connected car market due to their pivotal role in enhancing road safety, reducing accidents, and providing an added layer of convenience and comfort for drivers. The surge in the popularity and adoption of driver assistance applications within the connected car market is fundamentally rooted in the pursuit of a safer, more efficient, and enjoyable driving experience. As roadways become increasingly congested and the complexity of urban environments rises, there is a growing realization within the automotive industry and among consumers that advanced technologies can play a crucial role in mitigating risks and improving overall road safety. Driver assistance applications, encompassing features like adaptive cruise control, lane departure warnings, automatic emergency braking, and parking assistance, act as virtual co-pilots, providing real-time assistance and interventions to the driver. These applications leverage an array of sensors, cameras, radar, and lidar systems to monitor the vehicle's surroundings and make split-second decisions to enhance safety. For instance, adaptive cruise control adjusts the vehicle's speed based on the flow of traffic, while lane departure warnings alert the driver if they unintentionally drift out of their lane. Automatic emergency braking intervenes to prevent or mitigate collisions, significantly reducing the likelihood of accidents. In addition to safety benefits, driver assistance applications also contribute to the overall driving experience by offering added convenience and reducing driver fatigue. Features like parking assistance make maneuvering in tight spaces more manageable, while semi-autonomous driving functionalities pave the way for a more relaxed and comfortable driving experience. The growing emphasis on road safety, coupled with advancements in sensor technologies and artificial intelligence, has fueled the expansion of driver assistance applications within the connected car market. The Original Equipment Manufacturer (OEM) end market is growing in the connected car market due to an increasing consumer demand for seamlessly integrated, factory-installed connected car features that offer optimal performance, reliability, and compatibility with the overall vehicle design. The robust growth of the OEM end market within the connected car sector is intricately tied to the shifting preferences of today's consumers. Modern car buyers are increasingly seeking vehicles that seamlessly integrate advanced technologies, connectivity, and smart features as integral components of the overall driving experience. Original Equipment Manufacturers (OEMs) play a pivotal role in meeting this demand by offering factory-installed connected car features that are tightly integrated into the vehicle's design and architecture. Unlike aftermarket solutions, OEM-integrated connected car features are designed from the ground up, ensuring optimal performance, reliability, and compatibility with the vehicle's existing systems. Consumers are drawn to the convenience and reliability of having connected car functionalities seamlessly integrated during the manufacturing process. These integrated systems often include in-dash infotainment systems, advanced driver assistance features, telematics solutions, and more. The OEM end market's growth is also fueled by the desire for a unified and cohesive user experience, where connected features complement the vehicle's aesthetics and functionality seamlessly. As a result, consumers are increasingly valuing factory-installed solutions that don't disrupt the vehicle's interior design, ensuring a more streamlined and aesthetically pleasing integration. Furthermore, OEMs are well-positioned to leverage their deep understanding of vehicle design, engineering, and safety standards to deliver comprehensive connected car solutions. The seamless integration of these features at the manufacturing stage not only enhances the overall user experience but also ensures that the connected components are optimized for the specific vehicle model, contributing to better performance and reliability.
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The connected car market is flourishing in North America primarily due to a high level of consumer awareness, robust technological infrastructure, and a strong automotive industry focus on innovation, resulting in a growing demand for advanced connected car features and services. North America's notable growth in the connected car market can be attributed to a combination of factors that collectively create a fertile ground for the adoption of connected car technologies. Firstly, the region boasts a high level of consumer awareness and acceptance of emerging technologies, with a discerning market that actively seeks innovative and tech-savvy solutions. This heightened consumer interest drives demand for vehicles equipped with advanced connectivity features, such as in-car infotainment, real-time navigation, and safety-enhancing applications. Secondly, North America benefits from a robust technological infrastructure, providing a solid foundation for the implementation of connected car solutions. The widespread availability of high-speed internet and the ongoing deployment of 4G and 5G networks enhance the reliability and efficiency of connected car services. This infrastructure facilitates seamless communication between vehicles, the cloud, and external systems, enabling features like over-the-air updates, real-time traffic information, and remote diagnostics. Furthermore, the North American automotive industry has demonstrated a strong commitment to innovation and technological advancement. Automakers and technology providers in the region are actively investing in research and development to integrate cutting-edge connectivity solutions into their vehicles. This focus on innovation aligns with consumer expectations, driving the adoption of connected car features across various vehicle segments. Government regulations and initiatives promoting road safety and environmental consciousness also play a role in the growth of the connected car market in North America. Regulatory support for advanced driver assistance systems (ADAS) and the development of smart infrastructure contribute to the region's progressive stance on connected and autonomous vehicles. Additionally, the presence of key industry players, technology hubs, and research institutions in North America fosters a collaborative ecosystem that accelerates the development and implementation of connected car technologies. Partnerships between automakers, tech companies, and startups contribute to the creation of comprehensive and sophisticated connected car ecosystems that appeal to consumers.
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• April 2022 – Airbiquity®, a global leader in connected vehicle services, launched DATAmatic®, a suite of edge data management solutions to address the increasing need for services and tools that help automakers manage and monetize connected vehicle data. The suite includes the DATAmatic Edge Data Platform and DATAmatic Edge Data Logger. • January 2022 – Airbiquity®, a global leader in connected vehicle services, announced an advancement in its collaboration with Renesas, a premier supplier of advanced semiconductor solutions. This expanded technology integration involves the Renesas R-Car S4 system-on-chip (SoC) and the Airbiquity OTAmatic® software management platform. • In April 2022, Obigo Inc. (Obigo) and Korea Electric Technology Institute (KETI) collaborated to develop 5G-NR-V2X technologies for connected and autonomous automobiles. • In January 2022, Aptiv PLC announced a next-generation advanced driver-assistance system (ADAS) for driverless and electrified vehicles. Because of Aptiv's scalable architecture will help to reduce the cost of software-driven automobiles.
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