Automotive Sensors Market Size, Share and Growth Analysis

Updated on : October 22, 2024

Automotive Sensors Market Size & Growth

The global automotive sensors market size is projected to grow from USD 30.8 billion in 2023 and is anticipated to be USD 62.2 billion by 2028, growing at a CAGR of 15.0% from 2023 to 2028.

Growing focus on implementing vehicle authentication to ensure driver safety and comfort, Minimizing driver stress through adoption of advanced driver-assistance systems drives market growth during the forecast period. Factors such as growing adoption of EVs and HVs  to reduce CO2 emissions, increasing investments by automobile manufacturers in LiDAR technology provide market growth opportunities for the automotive sensors industry.

Automotive Sensors Market Forecast to 2028

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Automotive Sensors Market Analysis

The automotive sensors market is projected to grow significantly, driven by the increasing demand for advanced driver-assistance systems (ADAS) and the rising production of electric vehicles. The market's expansion is also fueled by stringent government regulations aimed at improving vehicle safety and emissions.

Automotive Sensors Market Trends

Current trends in the automotive sensor market include the adoption of more sophisticated sensors for autonomous vehicles and advancements in sensor technologies such as LiDAR and radar. Additionally, the integration of IoT and AI in automotive applications is enhancing sensor functionalities and capabilities.

Automotive Sensors Market Dynamics

Driver: Advancements in sensor technologies to meet customer requirements

Sensors have become more compact, energy-efficient, and cost-effective, enabling seamless integration into various applications. Innovations, such as solid-state LiDAR, CMOS image sensors with enhanced resolution and low-light capabilities, and susceptible microelectromechanical systems (MEMS) accelerometers, have redefined the data collection and analysis landscape. These advancements have empowered businesses to gather real-time insights with unprecedented accuracy, driving efficiency gains, process optimization, and developing cutting-edge products and services that cater to evolving customer demands. The rise of electric and hybrid vehicles requires sensors to monitor battery health, temperature, charging status, and other critical parameters for optimal performance and safety. The demand for in-car infotainment, navigation, and connectivity features necessitates sensors, such as GPS and accelerometers, to provide accurate navigation data and enhance user experience.

Restraint: High cost of LiDAR automotive sensors

Automotive sensors come with a relatively high price tag, which can limit their widespread use. The cost is driven up due to the expensive raw materials, complex manufacturing processes, and increased demand for these sensors. This makes developing and implementing advanced sensor technologies difficult, especially in price-sensitive markets where the high cost can negatively impact adoption rates. Sensors are essential in vehicles for various functions, including safety, engine management, and comfort features. This diversity drives up costs due to the need to manufacture and integrate multiple sensor types within a single vehicle. Developing advanced sensor technologies demands substantial research, testing, and prototyping investment. Costs are incurred in exploring innovative sensor designs, materials, and functionalities to meet the evolving demands of the automotive industry. Rapid technological advancements lead to frequent updates and iterations of sensor designs. This ongoing innovation can inflate costs as manufacturers strive to stay at the forefront of sensor capabilities.

LiDAR sensors have become indispensable for advanced driver assistance systems (ADAS) and autonomous vehicles due to their accurate 3D mapping and object detection capabilities. However, their integration into the automotive industry has been limited due to the high cost of production. The automotive industry relies on mass production, whereas LiDAR sensors are typically manufactured at lower volumes, resulting in higher unit costs. Extensive investment in research and development, customization for automotive use, compliance with regulatory requirements, and adherence to performance standards all contribute to elevated expenses. Despite these barriers, industry efforts and innovations, such as solid-state LiDAR technology and increasing competition, are gradually driving cost reductions, promising more accessible LiDAR solutions for a broader spectrum of vehicles and applications in the future.

Opportunity: Rising demand for automotive aftermarket services

Aftermarket opportunities in the automotive sensors market referred to the potential for selling and installing sensor-based products and solutions in vehicles not equipped initially with those sensors by the manufacturer. This growth is driven by increased demand for safety features, the rising popularity of aftermarket car modifications, and the growing popularity of electric vehicles. Some specific aftermarket opportunities in the automotive sensors market are Blind spot monitoring systems, Lane departure warning systems, Parking sensors, Battery monitoring systems, and Solar charging systems. Older vehicles lack the advanced safety features that are now becoming standard in newer models. Aftermarket sensors can be installed to add features, such as lane departure warning, blind-spot detection, and collision avoidance systems. Retrofitting telematics devices can add connectivity features to older vehicles, enabling features, such as remote diagnostics, vehicle tracking, and mobile app integration. As Technology advances and consumer demand increases, the aftermarket automotive sensor market continues to grow as a viable business opportunity

Challenge: Need for high-performance sensors

The increasing automation of vehicles has led to a significant rise in the need for high-performance sensors. These sensors must possess a high level of sophistication to gather and analyze data rapidly and precisely. However, this demand has put a considerable burden on sensor manufacturers who are grappling to meet the requirements. The development of high-performance sensors is a challenge for sensor manufacturers. These sensors must be able to collect and process data quickly and accurately while being reliable and durable. In addition, it must operate in various conditions, including extreme temperatures, vibrations, and dust. They must be able to withstand the harsh environment of the automotive industry. Sensor manufacturers are working to develop new technologies that can meet these challenges. Sensor manufacturers are investing in research and development to meet this demand.

Automotive Sensors Market Ecosystem

The automotive sensors market is competitive. It is marked by the presence of a few tier-1 companies, such as Robert Bosch GmbH (Germany), ON Semiconductor (US), OMNIVISION (US), TE Connectivity (Germany), and Continental AG (Germany),. These companies have created a competitive ecosystem by investing in research and development activities to launch highly efficient and reliable automotive sensors.

Automotive Sensors Market Segmentation

Original equipment manufacturer (OEM) segment to witness the highest growth during the forecast period

The original equipment manufacturer (OEM) refers to the manufacturers of original parts assembled and installed during the construction of a new vehicle. OEMs adopt the latest, mature products to meet the new AI and IoT technology-based sensor requirements. The automotive sensor manufacturers are highly focused on providing advanced sensors for vehicle safety and control applications. Automotive manufacturers are obliged to install automotive sensors during the manufacturing process due to government mandates regarding vehicle and road safety, fuel efficiency, and emission control worldwide. As a result, the market for technologically advanced automotive sensors is expected to proliferate, particularly in the context of autonomous vehicles.

Position sensors segment to hold the largest share of automotive sensors market between 2023 and 2028.

The growth of the position sensors segment can be attributed to the rising demand for autonomous cars and autopilot applications. Advanced technologies are increasingly being adopted in passenger and commercial cars because of the improving standard of living and rising consumer preference for better safety standards and comfort. Position sensors have become integral to vehicles, from vehicle seats and pedals to gear shifters. They ensure the safety and proper functioning of all vehicle components. Thus, innovation in automotive technology has increased the use of position sensors in vehicles.

Light commercial vehicle (LCV) segment to grow at  second fastest CAGR during the forecast period

The rising focus of automobile manufacturers on adding safety features, such as ABS and EBD, along with infotainment systems, in LCVs helps the automotive sensors market flourish in this vehicle segment. The cyclic growth in the sales of LCVs due to the surging demand for goods and carriage vehicles is further driving the sales of LCVs. This increase in the sales of LCVs is expected to impact the automotive sensor market positively.

Powertrain systems segment held the largest share of the automotive sensors market during the forecast period

The powertrain system of any vehicle defines its performance, comfort, and safety. Powertrain systems/components manufacturers have been adopting hybrid powertrain systems to reduce fuel consumption. The need for sensors in powertrain systems is driven by governments and automobile manufacturers worldwide' strong focus on lowering emissions, improving fuel economy, meeting onboard diagnostic requirements, and offering best-in-class drivability.

Regional Analysis - Automotive Sensors Market

Asia Pacific to grow at the fastest CAGR during the forecast period.

Government initiatives are pivotal in fostering sensor adoption and innovation. In Japan, the government actively promotes autonomous driving technology, stimulating the demand for sensors related to advanced driver assistance systems (ADAS) and autonomous vehicles. The strong push toward electric vehicles, backed by substantial government incentives, propels the demand for sensors related to EV batteries and charging infrastructure in China. Additionally, South Korea's focus on fifth-generation (5G) and sixth-generation (6G) network technologies catalyzes the development of connected vehicles, further boosting the automotive sensors market.

The region's growing middle-class population and youthful demographics contribute significantly to the surge in automobile demand, spurring innovation and adoption of sensor technologies across countries like India and China. As Asia Pacific continues to lead the global automotive industry in adopting advanced technologies and fostering a conducive regulatory environment, it is poised to be the largest automotive sensor market size in the coming years.

Automotive Sensors Market Statistics by Region

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Automotive Sensors Market Key Players

The automotive sensor companies is dominated by globally established players such as

• Robert Bosch GmbH (Germany),
• ON Semiconductor (US),
• OMNIVISION (US),
• TE Connectivity (Germany),
• Continental AG (Germany),
• Infineon Technologies AG (Germany),
• NXP Semiconductors (Netherlands),
• Denso Corporation (Japan),
• Panasonic (Japan),
• Allegro MicroSystems, Inc. (US),
• Sensata Technologies,Inc (US),
• BorgWarner, Inc. (US),
• Analog Devices, Inc. (US),
• ELMOS Semiconductor SE (Germany),
• Aptiv. (Ireland),
• CTS Corporation (US),
• Autoliv, Inc. (Sweden),
• STMicroelectronics (Switzerland),
• ZF Friedrichshafen AG (Germany),
• Quanergy Solutions, Inc. (US),
• Innoviz Technologies Ltd (Israel),
• Valeo S.A. (France),
• Magna International Inc. (Canada),
• Melexis (Belgium),
• Amphenol Advanced Sensors (US). 

These players have adopted product launches/developments, contracts, collaborations, agreements, and acquisitions for growth in the market.

Automotive Sensors Industry Overview

The automotive sensors industry is experiencing robust growth, supported by technological advancements and increased R&D investments by key players. The competitive landscape is characterized by strategic collaborations, mergers, and acquisitions to enhance product offerings and expand market presence. The automotive sensors industry is undergoing rapid growth due to the increasing adoption of advanced technologies in vehicles. This sector is characterized by significant investments in research and development, aiming to enhance sensor accuracy, reliability, and integration capabilities.

Automotive Sensors Market Report Scope

Automotive Sensors Market Highlights

The study categorizes the automotive sensors market-based sales channel, sensor types, vehicle types, application, and region.

Recent Developments in Automotive Sensors Industry

• In May 2023, ON Semiconductor (US) launched its Hyperlux automotive image sensor family, featuring industry-leading 150dB ultra-high dynamic range (HDR) and LED flicker mitigation (LFM).
• In June 2022, Allegro MicroSystems, Inc. (US) launched magnetic position sensors, A33110 and A33115, designed for advanced driver assistance systems (ADAS) applications..
• In May 2022, Infineon Technologies AG (Germany) launched the XENSIV 60 GHz radar sensor for automotive applications.

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