How Is Connected Car Adoption Contributing To Automotive Software Market Growth?
Growth drivers such as the mushrooming demand for connected cars, surging research and development (R&D) in autonomous driving (AD), and rising adoption of innovative technologies for advanced user interfaces will accelerate the automotive software market at a CAGR of 12.4% during the forecast period (2020–2030). The market was valued at $28,214.6 million in 2019 and it is expected to reach a revenue of $78,894.2 million by 2030. In recent years, the increasing practice of updating automobile systems by using over-the-air (OTA) technology has become a prominent market trend.
One of the key factors behind the automotive software market growth is the soaring demand for connected cars, primarily on account of the rapid urbanization across the world. The rising demand for such cars can also be credited to the escalating concerns for vehicle safety and security, booming demand for an enhanced driving experience, and surging integration of the internet of things (IoT) technology in the automobile industry. Automakers are using IoT to attain pathbreaking results in the connectivity solutions integrated into connected cars.
Globally, the Asia-Pacific (APAC) automotive software market generated the highest revenue in 2019 and it is expected to retain its position throughout the forecast period. This can be credited to the factors such as rapid economic development, the presence of the largest automobile market, and the soaring purchasing power of customers in the region. The flourishing economy of APAC countries is fueling the demand for advanced applications, such as auto-park assist, human-machine interfaces (HMI), and keyless entry, which are dependent on automotive software.
Thus, the burgeoning demand for connected cars, rising integration of innovative technologies for advanced user interface, and mounting R&D activities being conducted in autonomous technology will drive the demand for automotive software in the foreseeable future.
