Connected Cars Market: Growth and Opportunities

Connected Car Market

The Global Connected Car Market in the pre-COVID-19 situation was projected to reach USD 180.9 billion by 2025 from USD 63.2 billion in 2020. However, due to COVID-19, most of the countries have imposed a complete lockdown for more than two months, which has impacted vehicle production. The connected car market is estimated to observe a decline post-COVID-19 due to the impact on vehicle production.

The global connected car market size post-COVID-19 is estimated to be USD 53.9 billion in 2020 and projected to reach USD 166.0 billion by 2025, at a CAGR of 25.2%, driven by the developments in connected technology.

OPPORTUNITIES: Emergence of various technologies such as 5G and AI

The enhanced user experience for all connected cars depends on wireless connectivity. Many telecom industry players are developing 5G to increase the safety and efficiency of connected cars.  This technology is predicted to be introduced in the UK by 2020. According to International 5G automotive associations, 68% of accidents can be avoided with the upcoming 5G technology. For instance, the EU and South Korea have signed a deal to work together on 5G development, while both have promised USD 782 million and USD 1.5 billion, respectively, in funding for local 5G projects. In the UK, USD 78 million of funding has been commissioned for a 5G research facility, known as the 5G Innovation Centre (5GIC). With the increasing use of sensors and other technologies that collect data, AI will be key to making sense of everything. Some automobiles already use AI for Level 3 autonomous driving, but for the industry to reach Level 5, major enhancements need to be made to the cars as well as the infrastructure

The globally connected car market is dominated by major players such as Continental (Germany), Bosch (Germany), HARMAN (US), Airbiquity (US), and Visteon (US).

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The ECU plays a vital role in the connected car system and helps control different electronic systems of connected cars. The data generated through the hardware components are integrated into the ECU and transmitted to the cloud platform. Due to the increase in the number of electronics systems, the number of ECUs has increased, thereby adding to the complexity of vehicles. Hence, to reduce the complexity of ECUs, companies have started to consolidate many ECUs and focused on their R&D efforts to develop and standardize ECUs with a higher capacity range.

Aftermarket connected car services are expected to become the largest connected car market segment in terms of revenue generation. OEMs offer many services, such as remote diagnostics, navigation, multimedia streaming, and on-road assistance, as a monthly subscription that the customer could renew as per need. Due to an increase in demand for safety and comfort features in cars, the demand for these services in the aftermarket is expected to increase during the forecast period.

Many OEMs offer free service subscription for a specified time. For instance, Hyundai offers a free subscription for three years. The monthly subscription charges differ based on packages. The average monthly subscription cost is approximately USD 50–60, depending on the type of package selected. OnStar customers pay USD 24.99 for its safety & security services, including automatic crash response and emergency services; and USD 59.99 for the safety and security package plus unlimited access.

North America is estimated to be the fastest market due to growth in the US market. With the advent of IoT and vehicle-to-vehicle (V2V) connectivity solutions, the North American connected car market is witnessing impressive growth. The NHTSA is promoting connected car safety technologies such as dynamic brake support, crash imminent braking, and pedestrian automatic energy braking, to help improve road safety. This has also compelled the US connected car market players to take strategic measures, such as partnerships and acquisitions, to strengthen their existing connected car portfolios and introduce enhanced technologies with better safety and security protocols. For instance, in 2017, DENSO Corporation entered into a partnership with FotoNation, an image recognition technology developer, to use FotoNation’s technology to improve the performance of its Driver Status Monitor for enhanced driver safety in connected cars. In 2018, DENSO acquired a stake in the US startup, Metawave Corporation, to deploy Metawave’s radar-sensing technology in its automated radar system for connected cars to help detect pedestrians and vehicles in the path.

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This research report categorizes the given market based on service, form, end market, hardware, transponder, network, and region

Based on service:

  • Navigation
  • Remote Diagnostics
  • Multimedia Streaming
  • Social Media & Other Apps
  • OTA Updates
  • On-Road Assistance
  • eCall & SOS Assistance
  • Cyber Security
  • Remote Operation
  • Collision Warning
  • Auto Parking/Connected Parking
  • Autopilot
  • Home Integration
  • Vehicle Management
  • Asset Tracking

Based on hardware type:

  • Head Unit
  • Central Gateway
  • Intelligent Antenna
  • Electronic Control Unit
  • Telematic Control Unit
  • Keyless Entry Systems
  • Sensors

Based on form type:

  • Embedded
  • Tethered
  • Integrated

Based on End market:

  • OEM
  • Aftermarket

Based on transponder:

  • Onboard unit
  • Roadside unit

Based on Network:

  • DSRC
  • Cellular

Based on Region:

  • Asia Pacific
    • China
    • India
    • Japan
    • South Korea
    • Thailand
    • Rest of Asia Pacific
  • North America
    • US
    • Canada
    • Mexico
  • Europe
    • France
    • Germany
    • Italy
    • Spain
    • United Kingdom
    • Russia
    • Rest of Europe
  • Rest of the World
    • Argentina
    • Brazil
    • Iran
    • Rest of the RoW