The global connected car market is projected to reach USD 118,352 million by 2034 from an estimated valuation of USD 37,223 million in 2024, expanding at a CAGR of 12.3%. With remarkable progression in the past few years, the automotive sector has made big bets in the advancement and adoption of AI and advanced connectivity features.
Technological advancements have shaped the era of the automotive sector. With vast differences in specs and experience and the interior of the car or any vehicle, one can easily spot the integration of advanced features. The shift to AI and ML technology has enhanced the driving experience with the maximum comfort and visual appearances.
Cloud-based technologies have enabled automakers to collect and analyze vast amounts of data from connected vehicles. They are providing valuable insights into consumers' behavior, driving patterns, and vehicle performance. All these insights are used to develop new and innovative connected car services, enhancing the driving experience and improving road safety.
The shift from fuel-based to electric and hybrid vehicles is undergoing a significant transformation. Governments are actively involved in promoting intelligent transportation systems in metro cities. Many OEMs are participating in making smart transportation a reality, from bicycles to public transportation; the transformation is happening at a rapid pace.
Companies from the automotive and non-automotive industries are showcasing their innovative solutions for V2V and V2I communications. For example, the United States Transportation Department has proposed V2V communication in vehicles to reduce potential crashes and improve passenger safety.
Emergence of automotive vehicle technology in the Asia Pacific connected car industry is one of the key elements of increasing clamor for advanced connected car features. Japan has the leading connected vehicle penetration globally. Next comes China, witnessing notable growth.
Germany is also one of the principal producers and users of advanced cars. North America has also facilitated research units and growing boards globally with the implementation of advanced technologies.
| Attributes | Description |
|---|---|
| Expected Global Connected Car Market Size (2024E) | USD 37,223 million |
| Projected Global Connected Car Market Value (2034F) | USD 118,352 million |
| Value-based CAGR (2024 to 2034) | 12.3% CAGR |
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Clamor for Safety and Security Features
Rising consumer interest in connected car services and the growing adoption of IoT and cloud-based technologies have significantly expanded the automotive industry. Market opportunities for connected car cybersecurity solutions took a new direction due to many security concerns.
Major companies focused on enabling high-speed connectivity, sharing locations, and easy tracking to address these safety issues. The impact of autonomous driving technology on the industry has also raised many safety specifications to rely completely on the autonomous driving experience.
The increasing number of road accidents worldwide has driven industry growth. According to the World Health Organization, road traffic accidents account for approximately 1.35 million fatalities globally every year, making it a notable public health issue. Manufacturers have incorporated advanced safety features like lane departure warning, pedestrian detection, and automatic braking systems into vehicles to address this issue.
The influence of smart city initiatives on the connected car ecosystem has also prompted many major companies and manufacturers to shift to fuel-free vehicles. All these factors are influencing the growth of the automotive sector.
Demand for Convenience and Comfort Specs
Consumers are looking for ways to stay connected and entertained while driving. Automakers are offering a range of in-car entertainment and communication services, such as infotainment systems, voice recognition, and smartphone integration, all of which have advanced car interiors and the driving experience.
With the integration of AI and ML, the ability to adjust seats, air conditioning, and even operate entertainment applications has expanded the connected car application industry.
Rise of Ride-sharing Services
To address the increasing popularity of ride-sharing services, auto manufacturers are developing solutions to meet the demand from ride-sharing companies. Features such as real-time data sharing, seamless communication, and enhanced passenger experiences are being advanced by these companies.
The adoption of IoT and cloud-based technologies has updated connected services like remote diagnostics, over-the-air software updates, and predictive maintenance, accelerating the connected car market.
The global connected car market experienced a CAGR of 8.2% from 2019 to 2023, increasing from USD 24,267.2 million in 2019 to USD 33,231.2 million in 2023, with numbers expected to reach six digits in the next ten years.
The pandemic significantly affected the industry. During the outbreak, the automotive industry faced problems in supply chains. This has led to production slowdowns and a decline in consumer demand for all automotive products as lockdowns forced people to stay at home, reducing the need for personal transportation.
Economic uncertainties and joblessness further contributed to reduced purchasing power. However, this pandemic marked the importance of connected technologies in ensuring safer and more efficient transportation.
With developments and gradual recovery, this industry bounced back even stronger with more advanced features and safety gear. The growing emphasis on smart mobility solutions and the integration of artificial intelligence and machine learning in vehicles have brought in significant revenue. These vehicle technologies and changing consumer preferences for highly updated models indicate a CAGR of 12.3% through 2034, showing immense growth potential.
Governments in most countries are focusing on sustainability and are transitioning to fuel-free vehicles with the most advanced features. They are mandating various ADAS and safety features.
Many telecom industry players have developed 5G to enhance the safety and efficiency of connected vehicles. The shift to wireless connectivity and increased use of sensors and other technologies to collect data have flourished and speeded up sales.
Principal Consultant
In the connected car market, two related industries, connected aircraft, and hybrid vehicle industries, are studied below. Growth factors and challenges faced by these industries are mentioned to provide a comparative understanding.
With connectivity technologies, modulation in aircraft and hybrid vehicles has taken a new shape. Thus, real-time monitoring, GPS, Internet of Things for safety and monitoring purposes all position these industries among the top ones projecting revenues of more than five digits.
Connected Aircraft Industry Assessment:
The connected aircraft revolution has arrived in aviation, transforming the way people communicate on and off aircraft. This makes trips safer, more productive, and much more interesting. Key players are delivering solutions that improve the experience and also staff productivity through high-speed broadband. The Aircraft Communication and Reporting System are used to communicate with the ground-based operations team in real-time.
| Attributes | Description |
|---|---|
| Related Market | Connected Aircraft Market |
| CAGR (2024 to 2034) | 6.4% |
| Growth Factor | Growing adoption of IoT technologies for aircraft monitoring and maintenance |
| Key Challenges | Resistance to change and adoption among traditional aviation stakeholders |
Connected Logistics Industry Assessment:
The increasing demand to optimize the transportation and logistics industry to minimize costs and reduce emissions has immensely boosted this sector. Technologies like IoT, AI, machine learning, etc., are aiding in this landscape.
The increasing implementation of Industry 4.0 and the rising popularity of industrial IoT devices are also energizing the connected logistics sector. The growing usage of online shopping is a key factor contributing to the development of connected logistics.
| Attributes | Description |
|---|---|
| Related Market | Connected Logistics Market |
| CAGR (2024 to 2034) | 11.5% |
| Growth Factor | Growth of eCommerce leading to higher logistics volumes and complexities. |
| Key Challenges | Concerns about data security and privacy in connected logistics systems. |
The following section describes categorized segments of the connected car market. Various network technologies and communication types here show how the development progresses. 5G is among the top network technologies, and in V2V, V2I, and V2P communications, V2V offers a reliable and secure way of exchanging information.
At the forefront of global transformation is the introduction of advanced technologies and 5G. This technology is one of the leading network technologies in the connected car industry due to its high speed, low latency, and reliable connectivity. All these factors are essential for fulfilling the requirements of connected car applications. Thus, the 5G segment in network technology covers about 62.8% of the share for 2024, which is very impressive.
| Segment | 5G (Network Technology) |
|---|---|
| Value Share (2024) | 62.8% |
5G technology is expected to play a crucial role in the development of autonomous driving. Smart traffic management and enhanced in-car entertainment services have become easier with the implementation of a 5G network.
Faster data transfer and processing, essential for real-time communication between vehicles, infrastructure, and cloud-based services, have become more advanced with the 5G network. Reliable connectivity provided by the 5G network ensures that the connected car ecosystem remains stable and secure. Thus, 5G has sparked a revolution in surging demand for the connected car market.
V2V communication offers a reliable and secure way of exchanging information between vehicles, which is vital for successful connected car applications. V2V communication allows vehicles to share data such as speed, location, and direction, improving road safety and reducing congestion while enhancing the overall driving experience. V2V has an impressive and growing share of 67.2% for 2024 in the connected car industry.
| Segment | V2V (Communication Type) |
|---|---|
| Value Share (2024) | 67.2% |
V2V plays a crucial role in the development of advanced driver assistance systems. These systems rely on real-time communication between vehicles to improve safety and efficiency on the road. V2V also enables the development of platooning, where a group of vehicles travels in close proximity to each other, reducing drag and improving fuel efficiency. Also, V2V communication provides warning messages for emergencies and sudden weather changes.
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Germany, Italy, the United Kingdom, the United States, and South Korea are among the prominent leaders in the connected car market. Germany, known as the hub of automotive and machinery, has the top CAGR of 13.5% through 2034, making it poised to excel in this industry. Italy, another European country, follows suit. Below are the mentioned CAGRs of these countries, indicating their global expansion in this sector.
| Countries | CAGR 2024 to 2034 |
|---|---|
| Germany | 13.5% |
| Italy | 12.9% |
| United Kingdom | 12.5% |
| United States | 12.3% |
| South Korea | 11.8% |
The increase in investment to enable the adoption of cybersecurity in connected vehicles in European countries has boosted the sales of this connectivity. The introduction of new advanced technologies by manufacturers has held the largest market share.
Additionally, Germany, home to the biggest automotive sector, enables the integration of these technologies and the rapid adoption of software algorithms. The CAGR of 13.5% through 2034 stands out as outstanding, showcasing advancements and higher sales of these systems.
Innovation and research in Germany have spurred the expansion of the connected car market. From infotainment to the driving experience, it has transformed the interior of the car, providing the best interface with the latest technologies. For example, Bosch announced the launch of a new MEMS sensor, the SMI230. This launch has helped in realistic visualization of vehicle movements and ensured trouble-free navigation.
The United States is among the largest contributors to the growth of the connected car market in the North American region. Increasing vehicle safety and security norms, demand for vehicle-to-vehicle connectivity technology, and incorporation of IoT in the automotive industry are the main factors driving the United States' industry expansion. The United States is expected to register a CAGR of 12.3% from 2024 to 2034.
New infrastructure for formatting new research and building more innovative connectivity for vehicles, especially cars, has solidified the United States' presence in the global market. In October 2022, Ford Motor Co. opened the Ford Atlanta Research and Innovation Center in Atlanta, United States.
This unit was opened to accelerate digital transformation within the company and focuses on developing and testing new technologies for connected vehicles. Application of artificial intelligence in mobility and identifying new partnerships for university research in connected mobility are key aspects. Such units make a big difference in updating technologies in vehicles.
South Korea’s technological prowess and strong automotive industry have led to significant growth in the South Korean industry. The tech-savvy consumer base and demand for advanced features by the population create opportunities for more sales in the connected car market. The industry in South Korea is estimated to report a CAGR of 11.8% through 2034.
The South Korean government is also contributing to the industry's presence through smart transportation and smart city initiatives, offering incentives and subsidies to reduce traffic congestion and improve road safety. Collaborations between automotive manufacturers and tech companies have led to the development of advanced connected car technologies.
Artificial intelligence and autonomous driving are among the major innovations. For instance, in January, LG Uplus Corp., the third-largest mobile carrier in South Korea, agreed to provide exclusive wireless communication services to Hyundai Motor Group for its connected vehicles.
Collaboration between connectivity and advanced safety features enables real-time data exchange, empowering vehicles to communicate with each other and with infrastructure. Manufacturers are working on developing high-end features to ensure that the car interface provides the best driving experience. Big companies are opening research units, paving the way for a safer and technologically sophisticated driving future.
Industry Updates
Network technology present in the industry are 3G, 4G, and 5G.
V2V, V2I, and V2P are categorized as communication types in this sector.
Connected car finds application in to driver assistance, vehicle safety and security, infotainment, telematics, and navigation applications.
ICE and electric are two vehicle types in this industry.
A regional analysis has been carried out in key countries of North America, Latin America, Asia Pacific, Middle East and Africa (MEA), and Europe.
Industry is set to reach USD 37,223 million in 2024.
The valuation is expected to reach USD 118,352 million by 2034.
Industry is set to register a CAGR of 12.3% from 2024 to 2034.
5G tops the chart with a market share of 62.8% in 2024.
Germany is expected to progress at a CAGR of 13.5% through 2034.
1. Executive Summary 2. Industry Introduction, including Taxonomy and Market Definition 3. Market Trends and Success Factors, including Macro-economic Factors, Market Dynamics, and Recent Industry Developments 4. Global Market Demand Analysis 2019 to 2023 and Forecast 2024 to 2034, including Historical Analysis and Future Projections 5. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034 5.1. Technology 5.2. Connectivity Solutions 5.3. Service 5.4. Sales Channel 6. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Technology 6.1. 3G 6.2. 4G/LTE 6.3. 5G 7. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Connectivity Solutions 7.1. Connectivity Solutions 7.2. Embedded 7.3. Tethered 8. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Service 8.1. Driver Assistance 8.2. Safety 8.3. Entertainment 8.4. Well-Being 8.5. Vehicle Management 8.6. Mobility Management 9. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Sales Channel 9.1. Original Equipment Manufacturer (OEMs) 9.2. Aftermarket 10. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Region 10.1. North America 10.2. Latin America 10.3. Western Europe 10.4. South Asia 10.5. East Asia 10.6. Eastern Europe 10.7. Middle East & Africa 11. North America Sales Analysis 2019 to 2023 and Forecast 2024 to 2034, by Key Segments and Countries 12. Latin America Sales Analysis 2019 to 2023 and Forecast 2024 to 2034, by Key Segments and Countries 13. Western Europe Sales Analysis 2019 to 2023 and Forecast 2024 to 2034, by Key Segments and Countries 14. South Asia Sales Analysis 2019 to 2023 and Forecast 2024 to 2034, by Key Segments and Countries 15. East Asia Sales Analysis 2019 to 2023 and Forecast 2024 to 2034, by Key Segments and Countries 16. Eastern Europe Sales Analysis 2019 to 2023 and Forecast 2024 to 2034, by Key Segments and Countries 17. Middle East & Africa Sales Analysis 2019 to 2023 and Forecast 2024 to 2034, by Key Segments and Countries 18. Sales Forecast 2024 to 2034 by Technology, Connectivity Solutions, Service, and Sales Channel for 30 Countries 19. Competition Outlook, including Market Structure Analysis, Company Share Analysis by Key Players, and Competition Dashboard 20. Company Profile 20.1. LUXOFT 20.2. BMW GROUP 20.3. Qualcomm Technologies Inc 20.4. SAMSUNG ELECTRONICS CO. LTD 20.5. Continental AG 20.6. DAIMLER AG 20.7. VERIZON COMMUNICATIONS INC 20.8. Robert Bosch GmbH 20.9. AUDI AG 20.10. FORD MOTOR COMPANY
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