Connected Car Market Poised for Fast Growth, Says P&S Intelligence

The connected car market size stood at $72,499.2 million in 2019, which is projected to touch $198,459.7 million at a high 24.1% CAGR during 2020−2025. Many factors drive the market growth, such as the rising concern over vehicular security and safety, acceptance of the internet of things (loT) in the automotive sector, and advancing requirement for a better driving experience. A connected car has an internet connection, often through a wireless local area network (WLAN), which allows it to share internet data and access with devices both inside and outside.

Under the technology segment of the connected car market, the 5G category is expected to develop at the quickest rate in the future. Due to the increasing need for driving-related information in vehicles with minimized latency, for improved driving experience via real-time traffic updates, the integration of the 5G technology in automobiles is rising. In addition, the growing desire for improved coverage augmentation all over the world is propelling the incorporation of 5G communication technology into cars.

The growing rate of urbanization is increasing the demand for personal and commercial vehicles, mainly in developing countries, for instance, China, India, and Indonesia. Moreover, the long traffic jams, roadblocks, and lack of parking space are some of the issues that appear due to the increase in the number of automobiles on the roads. The issues can be solved by adopting advanced connectivity features, which also improve the driving experience. Connected cars communicate with each other, which allows them to keep ample distance from each other or avoid crowded stretches.

The arrival of AI interfaces is currently one of the major connected car market trends, as they are being adopted by several automakers. As a result of the initiatives by connected automobile industry participants, these infotainment systems may now operate as virtual personal assistants, responding to drivers’ voice queries and proactively guiding them through navigation systems. Furthermore, AI adoption is accelerating the technical advancements in the automobile sector, thus resulting in improved consumer satisfaction and enhanced driving experiences.

In 2019, North America had the greatest share in the connected car market, because of the high demand for innovative technology in passenger vehicles in the region. Roadside assistance, smartphone connectivity, automotive diagnostics, traffic and accident warning, and real-time traffic update functions are all included in connected automobiles. In other words, the growing need for a safe driving experience and the increasing implementation of favorable rules by federal and state governments regarding improved driving technology are moving the market in this area forward.

In the future, the connected car market is expected to grow the fastest in the APAC region. This will be due to the growing need for linked device integration in passenger automobiles, as well as the rising popularity of digital services, such as software updates and cybersecurity. Aside from the aforementioned factors, the growing number of strategic alliances declared by both automotive and non-automotive companies for creating a better communication infrastructure and complying with government regulations on automobile data security is expected to drive connected car sales in this region.

Hence, the market will attain significant growth due to the booming demand for enhanced driving experiences.

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