Driven by several factors, including rising adoption of ADAS features in automobiles, demand for advanced applications, and the high adoption of connected car services, the global Automotive Software Market is anticipated to grow at a CAGR of 13.1% till 2027.
According to the latest market research report published by MarketsandMarkets, the automotive software marketby application, connected services, autonomous driving, HMI, V2X, Infotainment, software layer, EV application, vehicle and region - global forecast to 2027, the global Automotive Software Market size is projected to reach $40.1 billion in 2027. In addition, the increasing adoption of regulations for safety by the governments in the various region is driving the market.
According to the report, the ADAS & safety system segment is expected to be the largest application of the automotive software market. Increasing adoption of ADAS in vehicles is one of the major reasons for the growth of the automotive software market, as these features enable safety, comfort, and luxury. The purpose of the software is to communicate autonomously with other devices. Thus, for establishing communication between vehicle and driver, the demand for the software is expected to grow at a prominent pace, the report said.
The report said that there will be a rapid evolution of safety features in the automotive industry. The growth of safety features is expected to rise in the coming years. The main motive behind implementing the features in a vehicle is to offer a convenient, efficient, and safer driving experience.
According to the report, China is expected to be the largest in the Asia Pacific automotive software market by 2027. China has been a dynamic power in the global economy and an established market in the field of connectivity. Furthermore, efforts to enhance the intelligent driving experience in the world's most prominent car market are estimated to drive further the growth of the Automotive Software Market in this country.
Key manufacturers are focusing on strategic partnerships with key market players, market expansion, R&D, and product advancements to keep up with the changing needs of people. This is estimated to drive the automotive software market over the estimated time period.
Autonomous driving is expected to be the fastest Automotive Software Market by 2027, the report said. The successful deployment of autonomous driving in real-world situations will complement the penetration of highly advanced software in vehicles. Leading OEMs, including Audi (Germany), BMW(Germany), Ford (US), Jaguar Land Rover (UK), Mercedes-Benz (Germany), Nissan (Japan), Tesla (US), and Volvo (India), already provide Level-2 driver assistance features globally. These include systems that provide steering, acceleration, and braking assistance when driving on motorways and dual carriageways. The full usage of connected car services will come into the picture when Level-3 autonomy gets introduced to the market. Currently, the Audi A8 has Level-3 features. Level-3 and above autonomous cars would require HD maps and V2X connectivity, and various sensors and AI solutions to communicate with internal and external environments. The vehicles rely heavily on advanced vehicle-to-vehicle and vehicle-to-environment communications to ensure Level-5 automation.
AI car software is connected to all the sensors and collects input from Google Street View and video cameras inside the car. The software encompasses multiple open and customisable layers, including an array of redundant and diverse deep neural networks, which enable key self-driving functionalities such as sensor fusion and perception. Therefore, introducing high-level automation in the market would drive automotive software demand in the near future, the report added.
Courtesy: MarketsandMarkets. Photo is representational; courtesy: Bosch.