Automotive IoT Market Size, Share, Trends, Growth and Forecast 2032

Automotive IoT Industry Prospective:

The global automotive IoT market size was worth around USD 131.13 billion in 2023 and is predicted to grow to around USD 373.87 billion by 2032 with a compound annual growth rate (CAGR) of roughly 8.50% between 2024 and 2032.

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Automotive IoT Market: Overview

Internet of Things (IoT) technology in the automotive industry is considered as the future of the vehicle manufacturing sector. IoT is defined as a modern-age technology used for quicker, safer, and easier transfer of data and information from one Internet of Things device to another. IoT is used by industries across the globe and the automotive industry is in the same race. Automotive IoT deals with the integration of several essential tools such as cloud technologies, devices, sensors, and other applications in a vehicle thus creating an extremely smart and sophisticated car connectivity ecosystem along with features such as predictive maintenance and management of fleet. IoT in the automotive sector has allowed vehicles to become superior entities with intelligent features. Some of the most considerate advantages of automotive IoT include increased productivity of vehicles, enhanced safety features, and optimization of maintenance processes. In addition to this, vehicle owners can collect crucial data related to their vehicle in real-time thus allowing them to undertake predictive maintenance and reduce the overall downtime. The growing demand for smart vehicles and increasing focus on road safety will drive revenue in the automotive IoT industry during the projection period.

Key Insights:

• As per the analysis shared by our research analyst, the global automotive IoT market is estimated to grow annually at a CAGR of around 8.50% over the forecast period (2024-2032)
• In terms of revenue, the global automotive IoT market size was valued at around USD 131.13 billion in 2023 and is projected to reach USD 373.87 billion, by 2032.
• The market is projected to grow at a significant rate due to the increasing sale of intelligent passenger cars likely to push higher use of IoT
• Based on the connectivity, the embedded was predicted to show maximum market share in the year 2023
• Based on the application, the telematics segment is anticipated to command the largest market share
• Based on region, Europe is projected to dominate the global market during the forecast period

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Automotive IoT Market: Growth Drivers

Increasing sales of intelligent passenger cars are likely to push higher use of IoT in the automobile sector

The global automotive IoT market is expected to witness high growth due to the increasing demand and sale of intelligent passenger cars. Modern consumers are aware of the various developments in the automotive industry as access to relevant information has grown tremendously through the aid of the Internet. This is one of the primary reasons for higher demand in the commercial market for vehicles offering advanced features such as superior connectivity. In addition to this, the market players have been proactive in understanding customer needs in terms of automobiles and taking necessary action with the launch of new and improved passenger vehicles. Moreover, the automotive industry is witnessing a sharp rise in the number of consumers driven by the growing demand for electric vehicles (EVs). The ever-changing fuel prices, uncertainties related to fuel availability, and the growing awareness about the environmental impact of internal combustion-powered vehicles are some of the leading reasons for higher EV demand. The regional governments are encouraging EV manufacturing by offering production subsidies to manufacturers and buyers thus attracting more consumers to the automotive sector. Most EVs consist of advanced technologies such as IoT devices for improved performance.

Growing demand for autonomous vehicles will allow the flow of higher income in the industry

Autonomous vehicles are also known as self-driving cars. In the last decade, the autonomous vehicle sector has registered higher interest from automotive enthusiasts. An increasing rate of investment in the development of functional self-driving cars is an indication of the growth scope autonomous vehicles hold. IoT is one of the prominent features of autonomous vehicles since these cars safely drive through a road only when they have access to relevant information about their surroundings which is made possible through IoT technology. In December 2022, LOXO, a Swiss startup announced the launch of a compact and high-performance autonomous vehicle thus essentially contributing to the global automotive IoT market.

Automotive IoT Market: Restraints

Risk of digital data theft could impact the market growth rate

The global industry for automotive IoT is expected to be restricted due to the concerns associated with growing cases of digital theft across the globe. IoT in automobiles makes the vehicles vulnerable to digital data theft which could lead to severe consequences. While compromise of individual privacy is one of the major concerns, in some cases, cyberattacks on automotive information can pose a safety risk for the general public as well. As per official data, India witnessed over 2000 weekly cyberattacks per organization.

Automotive IoT Market: Opportunities

Increasing the launch of faster communication devices will generate high-growth opportunities

The global automotive IoT market is expected to generate growth opportunities due to the growing investments toward the launch of faster communication devices and technologies. For instance, the rise in investment in mass deployment of 5G connectivity is expected to help fuel the performance of IoT systems. Additionally, mass deployment and acceptance of cloud-based connectivity infrastructure will further promote the acceptance of automotive IoT. In April 2024, Vodafone Idea received INR 5400 crore from 74 anchor investors. The company is expected to use the funds for the 5G rollout and expansion of infrastructure in India. In March 2024, CloudExcel, a Macquarie Capital-owned firm announced that it has reached a stage where it can aim at expansion of its fiber and wireless infrastructure by 5 times its current state. Moreover, the developments in sensor technology are remarkable thus creating a higher growth scope for the adoption of the new tools in the automotive sector. In January 2024, Texas Instruments announced the launch of new chips for vehicles thus offering automobiles with improved safety and autonomy. The new launch is an AWR2544 77GHz millimeter-wave radar sensor chip.

Increasing focus on vehicle-to-vehicle (V2V) communication will help create more growth opportunities for the industry

V2V is a promising technology against road accidents. Vehicle-to-vehicle communication is powered by vehicular ad hoc networks. The technology collects crucial information such as braking, speed, geo-location, and travel direction. The technology. Vehicles can transmit information using the V2V communication technology thus creating more growth scope for the global automotive IoT market.

Automotive IoT Market: Challenges

Retrofitting the technology in older vehicles could be a challenge

The global industry for automotive IoT faces challenges in terms of retrofitting the technology in legacy vehicles. The older automobiles may not have the supporting infrastructure for advanced technologies such as automotive IoT. Moreover, installing the technology may lead to higher upfront costs. The problems associated with regulatory complexities will further complicate the market growth rate.

Automotive IoT Market: Segmentation

The global automotive IoT market is segmented based on connectivity, offering, application, and region.

Based on connectivity, the global market segments are integrated, tethered, and embedded. In 2023, the highest growth was witnessed in the embedded segment. This deals with automobiles with integrated IoT features. Embedded connectivity helps vehicle manufacturers offer improved customer service. Additionally, the tethered segment is a crucial revenue contributor. In this case, external devices are used for enabling IoT in automobiles. The segment has higher applications in older vehicles that can support IoT integration. In 2022, over 85 million vehicles were produced globally.

Based on the offering, the global automotive IoT industry is divided into software, hardware, and services.

Based on application, the global market segments are telematics, infotainment, and navigation. In 2023, the highest demand was registered in the telematics segment. It is a combination of informatics and telecommunications. The use of telematics technology is highly regarded in road safety protocols. As per market research, over 40.05% of the new cars operating in the European areas consist of telematics technology.

Automotive IoT Market: Report Scope

Automotive IoT Market: Regional Analysis

Europe to register the highest growth during the forecast period

The global automotive IoT market is expected to witness the highest growth in Europe. The region has a high number of companies operating in the industry. Additionally, the European automotive industry is one of the world’s most advanced automobile sectors. The region is dominated by the presence of several pioneering automotive makers including luxury vehicles and affordable passenger cars. Moreover, Europe is also popular for its robust road safety protocols and implementation policies. In June 2023, network provider Vodafone announced the launch of a new broadband-IoT deal with car manufacturer Hyundai Motor Group. As per the deal, the new partnership will allow in-car infotainment and streaming services in all Genesis, Hyundai, and Kia models in the European region. Additionally, the growing investments in 5G infrastructure will further promote the regional market. North America is expected to deliver high revenue driven by the growing integration of the Internet of Things in automobiles. The growing launch of advanced electric vehicles and the increasing research activities toward further improvement in automotive IoT will help the regional market flourish. Growth in Asia-Pacific is expected to be driven by the thriving regional automotive sector. China, Japan, and South Korea will lead the regional market growth trend.

Automotive IoT Market: Competitive Analysis

The global automotive IoT market is led by players like:

• Verizon Connect
• Aeris Communications
• Visteon Corporation
• MiX Telematics
• Cubic Telecom
• Bosch
• Harman International
• Xevo Inc.
• Geotab Inc.
• INRIX Inc.
• Trimble Inc.
• Mojio Inc.
• Continental AG
• Autotalks
• TomTom.

The global automotive IoT market is segmented as follows:

By Connectivity

• Integrated
• Tethered
• Embedded

By Offering

• Software
• Hardware
• Services

By Application

• Telematics
• Infotainment
• Navigation

By Region

• North America
  • The U.S.
  • Canada
• Europe
  • France 
  • The UK
  • Spain
  • Germany
  • Italy
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Southeast Asia
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East & Africa
  • GCC
  • South Africa
  • Rest of Middle East & Africa