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Connected Car Market Poised for $56.3 Billion Growth by 2026

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Connected Car Market Poised for $56.3 Billion Growth by 2026

April 19
21:35 2023
Connected Car Market Poised for $56.3 Billion Growth by 2026
Attractive Opportunities in Connected Car Market
Connected Car Market by Service ICE & EV (OTA, Navigation, Cybersecurity, Multimedia Streaming, Social Media, e-Call, Autopilot, Home Integration), Form, Market (OE, Aftermarket), Network, Transponder, Hardware, and Region – Global Forecast to 2026

According to a research report “Connected Car Market by Service ICE & EV (OTA, Navigation, Cybersecurity, Multimedia Streaming, Social Media, e-Call, Autopilot, Home Integration), Form, Market (OE, Aftermarket), Network, Transponder, Hardware, and Region – Global Forecast to 2026″ published by MarketsandMarkets, the connected car market size is projected to reach USD USD 56.3 billion by 2026, from an estimated USD 23.6 billion in 2021, at a CAGR of 19.0%, from 2021 to 2026. The growth of the connected car market is influenced by factors such as the increasing trend of in-vehicle connectivity solutions, the development of smart city infrastructure, 5G infrastructure, and intelligent transportation systems. The developments and popularity of Mobility-as-service and Parking-as-a-service are expected to drive connected car services tremendously. MaaS providers typically act as intermediaries and offer smartphone applications for real-time and on-demand mobility services, including end-to-end ticketing and payment. Developments in autonomous vehicles, growing electric vehicle sales, and the popularity of integrated/smartphone-connected solutions are expected to increase car connectivity. Therefore, the connected car market is expected to witness significant growth in the future.

Cellular would be the largest and preferred network type to avail of connected car services

Cellular network has evolved over the years from 2G GPRS to 3G HSPA and 4G LTE, and now 5G. The launch of 5G will provide improved connected car technologies and functionality, not only in terms of services and features but also in terms of the accuracy of data and performance of vehicles. The implementation of a 5G-based telecommunication infrastructure can lead to a reduction in data transfer time and operating costs. The development of solutions by service providers in 5G technology is expected to further drive the adoption of the cellular network in the automotive industry. For instance, Qualcomm Technologies, Inc. announced the latest additions to its portfolio of Qualcomm Automotive Wireless Solutions for next-generation connected vehicles ─ the Qualcomm Snapdragon Automotive 4G Platform and the Qualcomm Snapdragon Automotive 5G Platform. Asia Pacific is the largest market and is also expected to be the fastest market for cellular networks due to the developed 4G networks and the development of 5G infrastructure in China, India, Japan, and South Korea. Europe and North America are also expected to witness growing 5G penetration in the passenger. For instance, Ford is building its own LTE/5G network to test connected cars in a private environment.

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Battery Electric Vehicles are to register the fastest CAGR in the global connected car market

BEVs are expected to witness higher penetration of connected services compared to PHEVs and HEVs. BEVs, such as the Tesla Model X, offer autopilot features, which include ADAS features such as adaptive cruise control, auto park, and lane departure warning systems. Nissan also offers proPILOT features in its Nissan Leaf and Nissan Altima electric cars, among others. The features of proPILOT include ADAS features such as ACC, IPA, and LDW. For such features to perform effectively, sensors such as cameras and radar are required. Currently, developments are undergoing in LiDARs for mass commercialization, which will significantly reduce the LiDAR prices significantly, thereby boosting the adoption of connected services globally. In the annual Global Electric Vehicle Outlook by the International Energy Agency (IEA), sales of electric cars, including fully electric and plug-in hybrids, doubled in 2021 to a new record of 6.6 million. Despite strains along global supply chains, sales kept rising strongly into 2022, with 2 million electric cars sold worldwide in the first quarter, up by ~75% from the same period a year earlier.

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 an increase in the number of electronics systems, the number of ECUs has increased, thereby adding to the complexity of vehicles. Hence, to reduce this complexity, companies have started to consolidate many ECUs and focus on their R&D efforts to develop and standardize ECUs with a higher capacity range.

Asia Pacific is expected to witness the fastest growth in the connected car market during the forecast period

By region, Asia Pacific is estimated to be the fastest-growing market for connected cars. The implementation of stringent government mandates for the installation of safety features and the growing demand for premium and luxury vehicles are the main factors driving the growth of the Asia Pacific connected car market. Developments in 5G and new product launches in connected car solutions/services and hardware are expected to drive the market in the future.

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