Advanced Driver Assistance Systems Market Analysis

Advanced Driver Assistance Systems Market (Global, 2024)

Introduction

The market for ADAS is undergoing a transformation as a result of technological developments and growing demand for vehicle safety and automation. Artificial intelligence, machine learning and sensors are increasingly used in ADAS, which in turn enables functions such as Adaptive Cruise Control, Lane-Keeping Assist and Automatic Braking. In line with the increasing emphasis on road safety and reducing the number of accidents, the car manufacturers are investing heavily in the development and implementation of ADAS. Furthermore, the increasing electrification of the car and the emergence of connected cars are expected to further increase innovation in ADAS. This report examines the various factors that affect the market, such as technological developments, consumer preferences and regulations, and provides a comprehensive overview of the current state and future prospects for ADAS.

PESTLE Analysis

Political

The political environment of the ADAS market in 2024 is largely determined by government regulations for the purpose of enhancing road safety. In Europe, for example, the European Union has set a deadline for 2024 for the installation of certain ADAS functions on new vehicles, such as automatic emergency braking and lane-keeping assistance. This regulation is expected to apply to the approximately 15 million new cars that are sold in the European Union each year, and thus compel manufacturers to invest in ADAS.

Economic

The market for ADAS will be influenced by the cost of the raw materials and components needed for the development of advanced technology. For example, the price of semiconductors, which are the basis of ADAS functions, has risen by a third since 2023, and this has pushed up the cost of ADAS to automobile manufacturers. However, the global automobile industry is expected to employ 9.5 million people in 2024, and a significant portion of these workers will be employed in the development and integration of ADAS.

Social

The social acceptance of ADAS is growing. In the U.S., for example, 72% of consumers are willing to pay an additional $1,500 for a car with ADAS. The trend is towards a greater awareness of the importance of road safety, and also towards a desire to enjoy driving more. Moreover, the generational shift towards younger consumers who are familiar with the latest technology is boosting demand for ADAS, with 65% of millennials preferring cars with advanced safety features.

Technological

In 2024, the market for ADAS is expected to reach $ 4 billion. It is therefore important to have a clear understanding of the technological developments in this area, which are crucial for the accuracy and reliability of ADAS features such as adaptive cruise control and collision avoidance systems. The integration of 5G technology is expected to enhance vehicle-to-everything (V2X) communication, enabling real-time data exchange between vehicles and the surrounding environment, which will increase system efficiency by up to 25%.

Legal

A number of legal frameworks are evolving to cope with the fast development of ADAS. In 2024, the National Highway Traffic Safety Administration in the U.S. will publish guidelines for testing and deploying fully automated vehicles, which will include requirements for ADAS. These guidelines will be binding on manufacturers and will apply to an estimated 10 million vehicles that will be tested under the new legal framework.

Environmental

The question of the environment is becoming increasingly important for the ADAS market, especially in the areas of exhaust emissions and energy efficiency. In 2024, the use of ADAS is expected to reduce carbon dioxide emissions by around 15 percent in urban areas. The systems will optimize the driving style and reduce the fuel consumption. The automobile industry is also expected to invest around $ 3 billion in sustainable technology to support the development of eco-friendly ADAS and contribute to the achievement of global sustainable development goals.

Porter's Five Forces

Threat of New Entrants

The ADAS market has moderate barriers to entry, as the high cost of R&D and the need for advanced technology and expertise makes it difficult for new entrants. However, the increasing demand for safety in vehicles and the technological developments could attract new players, which could increase competition.

Bargaining Power of Suppliers

Supplier power in the ADAS market is relatively low. There are many suppliers of the components used in ADAS systems, such as sensors, cameras and software. Suppliers are easily replaced, which limits the power of suppliers.

Bargaining Power of Buyers

In the ADAS market, the buyers are the automobile manufacturers and the consumers. They have significant bargaining power. The buyers can demand a better price and better features, which forces the suppliers to innovate in order to retain their market share.

Threat of Substitutes

There are, however, alternative safety systems and devices available, but the specific functionality offered by ADAS is not easily replaced by substitutes. The introduction of a completely driverless vehicle could, however, in the future pose a threat to the traditional ADAS solutions.

Competitive Rivalry

The competition is high in the ADAS market, with a large number of established players and new entrants vying for market share. In order to differentiate their products, companies are constantly investing in new technology, which is putting pressure on the margins.

SWOT Analysis

Strengths

• Increased focus on vehicle safety and accident reduction.
• Technological advancements enhancing system capabilities.
• Growing consumer acceptance and demand for smart vehicles.

Weaknesses

• High costs associated with advanced technology integration.
• Complexity of systems leading to potential user confusion.
• Dependence on regulatory approvals and standards.

Opportunities

• Expansion into emerging markets with rising automotive sectors.
• Integration with autonomous driving technologies.
• Partnerships with tech companies for innovative solutions.

Threats

• Intense competition among automotive and tech companies.
• Cybersecurity risks associated with connected vehicles.
• Potential regulatory changes impacting market dynamics.

Summary

In 2024, the market for advanced driver assistance systems is expected to be characterized by a strong growth rate, driven by increasing safety concerns and technological developments. However, challenges such as high integration costs and regulatory dependencies may slow down progress. Opportunities for expansion into emerging markets and collaboration with technology companies are also expected to increase growth, while competition and cyber threats will continue to be a major challenge for the industry.