Global Automotive Software Market Size By Product Type (Operating System, Middleware, Application Software), By Application (Safety System, Infotainment and Telematics, Powertrain), By Geographic Scope And Forecast

Automotive Software Market Size And Forecast

Automotive Software Market size was valued at USD 24.98 Billion in 2020 and is projected to reach USD 94.06 Billion by 2028, growing at a CAGR of 18.13% from 2021 to 2028.

The key factors that drive the growth of the market are the growing number of connected cars, the involvement of innovative technologies for advanced UI, an upsurge in electronic applications in vehicles, rising demand for electric vehicles, and automobiles with advanced driver assistance systems. The Global Automotive Software Market report provides a holistic evaluation of the market. The report offers a comprehensive analysis of key segments, trends, drivers, restraints, competitive landscape, and factors that are playing a substantial role in the market.

Global Automotive Software Market Definition

Automotive software signifies software, (or embedded software or firmware) that is related particularly to automotive industry-specific products or services. Automotive software has been used in vehicles not only for improving dashboard displays but for ensuring the safety of the operator and the other passengers as well. The use of automotive software in cars allows for more intricate systems while increasing functionality without raising costs and it also determines the proper operation of controls, protection, and computerized systems, and hence helping motor vehicles run more smoothly.

Automotive software is generally a set of instructions that helps the user interact with underlying in-vehicle hardware and also perform control functions in a vehicle. It focuses on the growing trend towards sensor fusion, automotive haptics, and the adoption of the on-board vehicle health monitoring and diagnostic system. Manufacturers of automotive infotainment systems are shifting towards the PC-like architectural concept, where the functionality of the system is dependent on the central processing unit (CPU).

Automotive software includes telematics, infotainment, powertrain, body control and comfort, communication, advanced driver assistance systems (ADAS) software. Automotive software refers to the firmware and middleware operating system used for running in-vehicle embedded applications. Advancements in technology have led to the incorporation of a number of microprocessors with increased memory space into automobiles. This is one of the reasons the global Automotive Software Market has been gaining traction in the recent past and is likely to grow at a significant pace during the forecast period.

Global Automotive Software Market Overview

The key factors that drive the growth of the market are the growing number of connected cars, the involvement of innovative technologies for advanced UI, an upsurge in electronic applications in vehicles, rising demand for electric vehicles, and automobiles with advanced driver assistance systems. The growing need for passenger cars has boosted global demand. The high demand for personal mobility, increasing disposable income, increasing per capita income, and improved lifestyle has enhanced the need for passenger cars with high-end electronics. The implementation of advanced technologies continues to be high in this vehicle segment owing to the higher production and sales of passenger cars worldwide. Additionally, the demand for automotive software is expected to propel due to the advent of technologies such as autonomous driving and IoT.

Moreover, the use of open-source platforms and standardization of product offerings has resulted in reduced cost of application and firmware development, thereby expanding the overall market for the Automotive Software Market. The latest technological advancements in commercial aspects of automotive software have urged the consumers as well as OEMs to gradually increase their focus on automotive infotainment systems and these manufacturers are contending based on the software or operating system that is used in these systems. Presently, vehicles support operating system platforms such as Windows CE, Android, Apple OS, QNX, and Linux-based OS. Furthermore, the adoption of ADAS features in vehicles, the rapid adoption of connected vehicles, and government partners to build infrastructure for connected vehicles has positively anticipated in propelling the growth of the global Automotive Software Market.

There are certain restraints and challenges faced which will hinder the overall market growth. The factors such as lack of skilled workforce, automotive engineer, expertise, and the absence of standards and protocols are limiting the market growth. Also, complex integrated systems and the integration of software such as IoT, Android, Apple into the existing automotive systems is a difficult task which confines the growth. Further, lack of connected infrastructure, troubleshooting, and maintenance of automotive software coupled with the risk of cybersecurity is the potential restraints hampering the overall growth of the global Automotive Software Market. Nevertheless, the advancements in technologies such as the future potential of 5G and AI provide a lucrative growth market. Moreover, growing developments in semi-autonomous and autonomous vehicles, SOTA updates to reduce vehicle recalls, data monetization in the extended automotive ecosystem, and untapped potential in emerging markets offer favorable growth opportunities.

Global Automotive Software Market Segmentation Analysis

The Global Automotive Software Market is segmented on the basis of Product Type, Application, And Geography.

Automotive Software Market, By Product Type

• Operating System• Middleware• Application Software

Based on Product Type, The market is bifurcated into the Operating System, Middleware, And Application Software. The application software segment holds the largest market share for the forecast period. The application software supports the customized functionalities and architecture of the vehicle. It consists of several applications and software layers, which allow the execution of tasks as per the application. The factors that can be attributed to the growing demand for infotainment, as well as telematics services around the globe, are likely to fuel the demand for the application segment.

Automotive Software Market, By Application

• Safety System• Infotainment and Telematics• Powertrain• Advanced Driver-Assistance Systems (ADAS)

Based on Application, The market is bifurcated into Safety System, Infotainment and Telematics, Powertrain, and Advanced Driver-Assistance Systems (ADAS). Advanced Driver-Assistance Systems (ADAS) is expected to be the largest application during the forecast period. The factors can be attributed to benefit consumers and protect them from potential hazards. It contributes toward improving the overall safety of the driver as well as passengers. It includes the application of communication technology in ADAS features such as blind-spot detection, adaptive cruise control, lane departure warning, automatic emergency braking, and park assist. It also includes basic safety systems such as an anti-lock braking system (ABS), vehicular communication system, adaptive cruise control (ACC), tire pressure monitoring system (TPMS), and electronic stability control.

Automotive Software Market, By Geography

• North America• Europe• Asia Pacific• Rest of the world

On the basis of Regional Analysis, The Global Automotive Software Market is classified into North America, Europe, Asia Pacific, and Rest of the world. Asia-Pacific holds the largest market share. The increased demand for connected services, particularly in China, Japan, and South Korea. The tech-savvy population in these countries demands a safe and connected driving experience. Moreover, it is the largest market since it has the majority of vehicle production, which is further exported to other regions along with strong governmental initiatives and ongoing projects that will boost the market in the APAC region.

Key Players

The “Global Automotive Software Market” study report will provide valuable insight with an emphasis on the global market. The major players in the market are Airbiquity, Adobe, ACCESS, Atego, Blackberry, Green Hills Software, Mentor Graphics, Microsoft, Wind River, Autonet Mobile, NXP Semiconductors, Renesas Electronics, Broadcom, Google, MontaVista Software, and Texas Instruments. The competitive landscape section also includes key development strategies, market share, and market ranking analysis of the above-mentioned players globally. 

Key Developments

Partnerships, Collaborations, and Agreements

• In February 2021, The Volkswagen Group has announced a collaboration with Microsoft Corporation to accelerate the development of automated driving. Under this partnership for the agile development of automated driving functions the Volkswagen Group’s Car Software Organisation along with Microsoft Corporation will build an automated driving platform.

• In November 2020, The Hyundai Motor Group which is a leading automotive manufacturer has partnered with NVIDIA. The aim of this collaboration is to equip the entire line-up of Kia, Hyundai, and Genesis models in standard with NVIDIA DRIVE which is an In-Vehicle Infotainment (IVI) system from the beginning of the year 2022.

Mergers and Acquisitions

• In September 2021, Renovo Motors Inc. an America-based automaker company has been acquired by Woven Planet Holdings which is a subsidiary of Toyota Motor Corporation. The aim of this acquisition is to advance the development of software for autonomous vehicles.

• In May 2019, Integrated Device Technology (IDT) which is a leading supplier of analog mixed-signal products such as wireless power, connectivity, and sensors has been acquired by Renesas Electronics Corporation a leading semiconductor manufacturer. The aim of this acquisition is to deliver a wide range of leading-edge technology and embedded solutions.

Product Launches and Product Expansions

• In July 2020, A new category, Cross-Domain Computing Solutions that will merge all automotive electronics and software-related areas will be introduced by Bosch a leading engineering and technology company. The aim of this new category launch is to control the complexity of electronic systems.

• In January 2020, A new S32G vehicle network processor has been launched by NXP Semiconductors. This launch enables a shift towards the high-performance domain-based vehicle architectures in the automotive industry and will provide less software-related complexity. In addition, it will enhance the security and safety of the vehicle.

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• Qualitative and quantitative analysis of the market based on segmentation involving both economic as well as non-economic factors• Provision of market value (USD Billion) data for each segment and sub-segment• Indicates the region and segment that is expected to witness the fastest growth as well as to dominate the market• Analysis by geography highlighting the consumption of the product/service in the region as well as indicating the factors that are affecting the market within each region• Competitive landscape which incorporates the market ranking of the major players, along with new service/product launches, partnerships, business expansions and acquisitions in the past five years of companies profiled• Extensive company profiles comprising of company overview, company insights, product benchmarking and SWOT analysis for the major market players• The current as well as the future market outlook of the industry with respect to recent developments (which involve growth opportunities and drivers as well as challenges and restraints of both emerging as well as developed regions• Includes an in-depth analysis of the market of various perspectives through Porter’s five forces analysis• Provides insight into the market through Value Chain• Market dynamics scenario, along with growth opportunities of the market in the years to come• 6-month post sales analyst support

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