Connected Vehicle Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

Connected Vehicle Market Analysis

The connected vehicle market was valued at USD 66.12 Billion in 2021, and it is expected to reach USD 187.75 Billion by 2027, registering a CAGR of about 19% in terms of revenue during the forecast period (2022-2027).

The COVID-19 pandemic had a massive impact on the market studied as lockdowns and trade restrictions have led to supply chain disruptions and a halt of vehicle production across the globe. However, as restrictions eased, players started focusing on mitigating such risks and developments to create momentum in the market during the forecast period.

The rising integration of advanced safety and comfort features in the vehicle, such as advanced driver assistance systems, vehicle infotainment, and many others witnessing major growth in the market. Growing production of vehicles with integrated ADAS features in the wake of rising awareness toward comfort and safety of passengers and government regulations mandating safety features are expected to drive demand in the market. Moreover, the rising acceptance of self-driving or automated vehicles further contributes to the enhanced growth of the market.

Governments across the globe are focusing on designing several legislative policies and regulations to monitor the users and are proposing policies mandating and encouraging consumers to install ADAS components in vehicles to mitigate rising road accidents across several countries. For instance, the Indian government has already mandated a requirement for ABS on motorcycles with a focus on improving vehicle safety. Currently, India is working to make Electronic Stability Control (ESC) and Autonomous Emergency Braking (AEB) mandatory in cars by 2022-2023.

Connected Vehicle Industry Segments

A connected vehicle is any type of vehicle which connect to the internet. Usually, such vehicles connect to the internet through WLAN (Wireless Local Area Network). A connected vehicle can also share the internet with devices inside and outside the car and, at the same time, can also share data with any external device/services.

The connected Vehicle market covers the latest technology trends, government policies to promote connected features in vehicles, and the market share of major connected car manufacturers across the globe. The Global connected vehicle market is segmented by technology type, application, connectivity, vehicle connectivity, vehicle type, and geography.

Based on the technology, the market is segmented into 4G, 3G, and 2G. Based on the application, the market is segmented into driver assistance, telematics and infotainment, and others. Based on the connectivity, the market is segmented into Integrated, Embedded, and Tethered. Based on the vehicle connectivity, the market is segmented into Vehicle to Vehicle (V2V), Vehicle to Infrastructure (V2I), and Vehicle to Pedestrian (V2P). Based on the vehicle, the market is segmented into passenger cars and commercial vehicles. Based on geography, the market is segmented into North America, Europe, Asia-Pacific, and the Rest of the World. The report covers the market size in value (USD Billion) for all the above segments.

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Connected Vehicle Market Trends

This section covers the major market trends shaping the Connected Vehicle Market according to our research experts:

Growing demand for ADAS features in vehicle

Autonomous cars and connected vehicles are gaining consumers' interest and are anticipated to gain wider acceptance over the forecast period. The advanced driver assistance systems (ADAS) featured are expected to diminish the penetration gap between traditional cars and tomorrow's cars. Moreover, With the rising technological advancements in the automotive industry, end users are ready to spend more on the latest technologies, which enhance the driving experience and increase the safety of drivers and riders. ADAS features, such as collision warning, lane assistance, blind spot detection, etc., have a significant impact on consumer behavior and are expected to enhance vehicles' performance by reducing vehicle downtime by alerting the owner of any faults in the vehicle.

ADAS has advanced considerably, but there is still a long way to go with connected vehicle technology. V2V communication has the potential to upgrade it further, as vehicles may communicate with each other directly and share information on relative speeds, positions, directions of travel, and even control inputs, such as sudden braking, accelerations, or changes in direction. By using this data with the vehicle's sensor inputs, it is possible to create a more detailed picture of the surrounding area and provide more accurate warnings or even corrective actions to avoid collisions.

However, the number of ADAS components may keep growing, as these previously available systems in high-end models are now being used in entry-level vehicles. These systems bring added safety and security to daily driving. Many of these systems allow the vehicle to make driving adjustments according to the condition. Functions, such as steering, braking, and accelerating, can be performed by the vehicle in certain situations. For instance,

Research conducted by Canalys shows that the lane-keep assist feature, which when activated provides steering assistance to keep a vehicle in its lane, was installed in 56% of new cars sold in Europe in the first half of 2021, 52% in Japan, 30% in Mainland China, and 63% in the United States.

Many technology companies in the market are teaming up to solve the complexities of developing advanced driver-assistance systems (ADAS). For instance,

• In June 2022, PATEO Corporation and Qualcomm Technologies, Inc. (Qualcomm) expanded their relationship to develop solutions to support vehicle intelligence, smart car connectivity, Service-Oriented Architecture (SOA), and intelligent cockpits and multi-domain fusion based on central controllers.
• In July 2021, Magna International Inc. announced its plans to acquire safety tech major Veoneer Inc. Magna International Inc. entered a definitive merger agreement with Veoneer Inc., under which the company plans to acquire Veoneer Inc., a leading player in automotive safety technology. With this acquisition, Magna's aimed to strengthen and broaden its ADAS portfolio and industry position.

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