Connected Car Market Size

Market Size Snapshot

Note – Market size depicts the revenue generated over the financial year

The connected car market is set for tremendous growth, with a current market size of $ 35.181 billion in 2024, projected to grow to $ 170 billion by 2032. This phenomenal growth translates into a CAGR of 21.76% for the forecast period. The growth is largely based on the integration of advanced technology, such as the Internet of Things (IoT), artificial intelligence (AI) and 5G connectivity, which in turn is driven by the need for enhanced vehicle safety, efficiency and the quality of the ride experience. The growth is also fueled by the increasing demand for smart transportation solutions, the growing popularity of electric vehicles and the growing importance of vehicle-to-everything (V2X) communication. The industry leaders, such as General Motors, Ford and Tesla, are investing heavily in connected car technology, entering into strategic alliances and launching new products in order to seize market share. These alliances between the automobile manufacturers and the technology companies, for example, facilitate the development of advanced infotainment systems and the implementation of self-driving features, thereby driving the connected car market forward.

Regional Market Size

Regional Deep Dive

The connected car market is experiencing strong growth in various regions, driven by technological developments, increasing demand for enhanced safety and convenience features, and a growing focus on sustainable mobility. In North America, the market is characterized by a high penetration of ADAS and a robust infrastructure for connected services. In Europe, meanwhile, a number of regulatory initiatives are aimed at enhancing vehicle safety and reducing emissions, while in Asia-Pacific, a growing number of smartphone users and the expansion of 5G networks are fostering the rapid uptake of connected car solutions. The Middle East and Africa are gradually adopting connected car solutions, influenced by the urbanization trend and government initiatives to modernize transportation. Latin America is a nascent market, but connected car solutions are being adopted as part of smart city projects.

Europe

• The European Union has implemented stringent regulations on vehicle emissions, prompting automakers to integrate connected technologies that optimize fuel efficiency and reduce carbon footprints.
• Companies like Volkswagen and BMW are leading the charge in developing connected car platforms, with initiatives such as Volkswagen's 'We Connect' and BMW's 'ConnectedDrive' enhancing user engagement and vehicle functionality.

Asia Pacific

• China is rapidly advancing in the connected car space, with companies like Baidu and Alibaba investing in autonomous driving technologies and smart vehicle solutions, supported by government policies promoting innovation.
• The rollout of 5G networks across countries like South Korea and Japan is facilitating faster data transmission for connected vehicles, enabling real-time updates and enhanced user experiences.

Latin America

• Brazil is beginning to see a rise in connected car technologies, driven by increasing smartphone penetration and a growing interest in smart city initiatives that incorporate connected vehicles.
• Local governments are exploring partnerships with automotive manufacturers to promote connected vehicle technologies as part of broader urban mobility strategies, enhancing transportation efficiency.

North America

• The U.S. government has introduced regulations mandating vehicle-to-everything (V2X) communication, which is expected to enhance road safety and traffic management, leading to increased adoption of connected car technologies.
• Major automotive manufacturers like Ford and General Motors are investing heavily in connected vehicle technologies, with Ford's 'FordPass' app and GM's 'OnStar' services enhancing user experience and connectivity.

Middle East And Africa

• The UAE is at the forefront of connected car technology in the region, with initiatives like the Dubai Smart City project aiming to integrate smart transportation solutions into urban planning.
• Local automotive companies are collaborating with tech firms to develop connected vehicle solutions, with projects like the partnership between Dubai's Roads and Transport Authority and various tech startups focusing on smart mobility.

Did You Know?

“By 2025, it is estimated that over 75% of new vehicles sold globally will be connected to the internet, enabling a range of services from navigation to remote diagnostics.” — example.com

Segmental Market Size

The Connected Car Market is growing at a rapid rate, driven by the growing demand for increased safety, convenience and communication features in vehicles. In addition to the rise in the number of vehicles, there is an increase in the number of vehicles equipped with a number of advanced communication and entertainment systems. There is a growing demand for seamless connection between consumers and their vehicles. In this context, car manufacturers are increasingly prioritizing the development of connected features that enhance the driving experience. The Connected Car Market is currently in the stage of commercialization. Among the car manufacturers, the leading connected car companies are Tesla and Ford. North America and Europe are at the forefront of connected car technology development and have made significant investments in the development of communication and IT systems. The most important connected car applications are real-time navigation, vehicle-to-everything (V2X) communication and remote diagnostics. OnStar is the best example of the latter. In addition to the above, macro trends such as the green economy and the regulation of electric vehicles are also driving growth. In addition, 5G and the Internet of Things (IoT) are enabling the development of smarter and faster data transmission between vehicles and the outside world.

Future Outlook

From 2024 to 2032, the connected car market is expected to grow at a CAGR of 21.76%, from about 35.18 billion to about 170 billion. In addition to the development of 5G technology, the integration of artificial intelligence and the Internet of Things, which will enhance the performance and experience of the vehicle, will also play an important role in the development of the connected car. By 2032, it is expected that more than 70% of new vehicles sold in the world will be equipped with connected car features, which will greatly change the car landscape and the driving experience of consumers. In addition, with the continuous improvement of government policies, the safety of vehicles and the reduction of exhaust emissions are also being improved, and consumers are demanding more and more. Connected features and automation. The emergence of electric vehicles and the development of self-driving technology will also further promote the penetration of connected car features. In order to make the products more competitive, the car companies will have to make corresponding changes in the business model. The development of the Internet and the development of new business models, such as the combination of car companies and technology companies, will bring about more innovation, resulting in new services such as real-time traffic information, remote diagnosis, and personalization of in-car experience. In the future, the car industry will not only change the current transportation system, but also create new business models and revenue sources for the entire car industry.