Automotive Software Market by ICE Application (ADAS, Autonomous Driving, Infotainment, Body Control & Comfort, Telematics), Software Layer (OS, Middleware, Application), Vehicle Type (PCs, LCVs, HCVs), EV Application & Region - Global Forecast to 2030
[274 Pages Report] The global automotive software market size was valued at USD 19.0 billion in 2023 and is expected to reach USD 32.3 billion by 2030, at a CAGR of 7.8%, during the forecast period 2023-2030. Rapid integration of ADAS features in vehicles, and increasing adoption of connected car services, paired with rising deployment of ECUs and domain controllers in vehicles are anticipated to increase the demand for automotive software all over the world.
To know about the assumptions considered for the study, Request for Free Sample Report
To know about the assumptions considered for the study, download the pdf brochure
Automotive Software Market:
Driver: Advancements in infotainment systems
There is strong competition among automotive manufacturers to deploy cutting-edge infotainment systems for their upcoming vehicle models. For example, Mitsubishi Motors Corporation (Japan), Nissan Motor Co., Ltd. (Japan), and Renault (France) have adopted Google’s Android operating system for their next-generation infotainment systems. In November 2022, Hyundai Motor (South Korea) also selected NVIDIA drive infotainment and AI platform for all future Hyundai, Kia, and Genesis models.
The changing consumer preference pertaining to wireless technology, along with the steady increase in demand for seamless connectivity of phones with passenger cars, is expected to drive the in-vehicle infotainment segment. This, in turn, will increase the demand for in-vehicle infotainment systems, thereby supporting the revenue growth of the automotive software market during the forecast period. As such, automotive software (operating systems such as Android, Linux, and QNX) are integral parts of the in-vehicle infotainment systems.
Furthermore, there is a high demand for infotainment services such as navigation and traffic updates. Most of these services require real-time information and are listed in the traffic efficiency section. This would require the need for automotive software to deliver real-time information. These aforementioned parameters are expected to bolster the revenue growth of the automotive software market during the forecast period.
Restraint: Lack of standard protocols for development of software platforms
Subject to technological advancements, passenger and commercial vehicles are now equipped with advanced automotive software to perform various operations. Automotive software communicates through several interfaces, platforms, technologies, and protocols. A lack of standardization of these interfaces and protocols may result in inaccurate data and complex integration of systems. Non-standard protocols may also be more vulnerable to security threats as they are less well-known and well-tested than standard protocols. Hence, the lack of software standardization restrains the growth of the automotive software market.
Furthermore, automotive software controls a broad range of functions, from the engine and transmission to the infotainment system and advanced driver assistance system (ADAS). This complexity makes it difficult to develop standard protocols that meet the needs of different automotive systems. However, automotive OEMs are collaborating to resolve this issue. For example, in February 2019, Daimler AG (Germany) and BMW AG (Germany) alliance sought to standardize technology for automated driving cars.
Opportunity:Developments in semi-autonomous and autonomous vehicles
Autonomous vehicles have become a decisive focal point for automotive stakeholders. They have invested billions of dollars and best resources into completing the task of making autonomous vehicles a reality. Currently, vehicles are equipped with various electronic components to sense their environment and exchange signals with external entities. Behind the whole communication process, a vast amount of data is generated for implementing machine learning with algorithms in the vehicle’s computer system. This would help OEMs, automotive Tier I suppliers, and non-automotive players to make autonomous vehicles a reality. Hence, reliable automotive software is the key to implementing AI and developing semi-autonomous and autonomous cars.
Manufacturers are focusing on launching new advanced software that will support autonomous driving. For example, in July 2023, Volkswagen (Germany) started its first autonomous vehicle test program in Austin, US, and anticipates a commercial launch of autonomous driving vehicles by 2026. Similarly, in March 2023, Ford Motor Company (US) established Latitude AI, a subsidiary that focuses on developing a hands-free, eyes-off-the-road automated driving system for millions of vehicles. Apart from OEMs and other players in the automotive ecosystem, start-ups are unleashing distinctive software platforms for autonomous cars. There are developments in automotive software with many potential opportunities, which are yet to be channelized for automotive software in the autonomous space. Therefore, automotive software has a lot of revenue opportunities in semi-autonomous and autonomous vehicle technologies.
Challenge: Complexity of vehicle architecture
In the automotive sector, product development is typically driven by the market competitiveness and stringent regulations for reducing CO2 emission levels, resulting in product variance, individualization, function integration, and novel technologies. Modern vehicles are equipped with advanced features, such as ADAS, infotainment systems, and communications systems. These features require individual hardware and software, adding to the complexity of vehicle architecture. Electric and hybrid vehicles have more complex architectures than traditional gasoline-powered vehicles because they have additional components, such as electric motors, batteries, and power management systems. These factors increase organizational, technical, and procedural dependencies in complicated development environments. From time to time, the effects of complexity surface in the form of defect reports, ultra-high design efforts, and an explosion of warranty costs. Complexity is important for endowing a system with functions as well as characteristics, but it is also challenging to understand the system. In the code, millions of elements, such as local variables, global variables, operators, conditional statements, pointers, preprocessors, threads, and functions, create complicated units and abstraction layers of large scales.
Automotive Software Market Ecosystem
The ecosystem analysis highlights various players in the automotive software ecosystem, which is primarily represented by OEMs, tier 1 integrators/suppliers, and others. Prominent companies in this market include Robert Bosch GmbH (Germany), NXP Semiconductors (Netherlands), BlackBerry Limited (Canada), Alphabet Inc. (US), and NVIDIA Corporation (US), among others.
ADAS & safety systems segment is expected to witness significant growth rate in the global automotive software market during the forecast period
The ADAS & safety systems segment is anticipated to have lucrative growth opportunities during the forecast period. Government mandates and increasing awareness about vehicle safety are expected to fuel the demand for ADAS & safety systems. In July 2023, the US federal government’s National Highway Traffic Safety Administration (NHTSA) proposed mandatory regulation that could significantly impact road safety. The autonomous driving segment is also expected to show significant market growth during the forecast period. Automotive OEMs are taking the initiative to develop and bring advancements in autonomous driving. For example, in July 2023, Volkswagen Group (Germany) launched its first autonomous driving test program in the US. Such developments and government initiatives will boost the market.
Application software segment is expected to be the largest in automotive software market during the forecast period
Application software is expected to have significant growth opportunities in the market during the forecast period. This is attributed to the increasing sales of ADAS-equipped vehicles and the rising demand for connected technologies. Companies such as Honda Motor Co., Ltd. (Japan), Toyota Motor Corporation (Japan), Mahindra & Mahindra Limited (India), BYD (China), and MG Motor (UK), among others, offer ADAS features such as adaptive cruise control, lane keeping assist, lane departure warning, auto emergency braking, traffic sign recognition, blind spot detection, and rear collision warning. These features require application software to work effectively in a real-time environment. For example, in India, automotive OEMs such as Mahindra & Mahindra Limited and Morris Garages offer ADAS features such as adaptive cruise control with stop and go, lane keep assist, and traffic sign recognition.
Body control & comfort systems segment is expected to have significant growth opportunities in automotive software market by EV Application during the forecast period
Body control & comfort systems in BEVs function through automotive software as they are responsible for managing and coordinating the various systems and components of the vehicle, such as the powertrain, brakes, steering, and suspension. They also play a vital role in communicating with the vehicle’s environment, such as other vehicles, infrastructure, and pedestrians. Automotive software is used to develop and implement various body control & communications system functions, such as vehicle control, communication, and safety.
Body control & communications systems heavily rely on automotive software for controlling and managing components such as windshields, central locking systems, climate control systems, and air conditioning. These systems are becoming increasingly complex as BEVs become more advanced and autonomous. Consequently, developments such as panoramic sunroofs, noise cancellation systems, and electric door locks are underway to improve body comfort and communication, thereby driving the market, by EV application, during the forecast period.
“The Asia pacific automotive software market is projected to hold the largest share by 2030.”
Asia Pacific is projected to be the largest market by 2030. Countries such as China, Japan, and South Korea are expected to take the lead in autonomous driving technology in the coming years. Leading automotive manufacturers in this region, including Honda Motor Co., Ltd. (Japan), Toyota Motor Corporation (Japan), and Hyundai Motor Company (South Korea), leverage the advantages of safety systems and have made essential safety features a standard across their models. Toyota Motor Corporation (Japan) designed its Toyota Safety Sense ADAS package, which comprises a pre-collision system with pedestrian detection, dynamic radar cruise control, lane departure alert, automatic high beam, lane tracing assist, and road sign assist. This will increase the demand for passenger vehicles in the region with advanced safety features by end users, boosting the market for automotive software as these features require automotive software for efficient functioning.
Key Market Players
The global automotive software market is dominated by major players such as Robert Bosch GmbH (Germany), BlackBerry Limited (Canada), Continental AG (Germany), NXP Semiconductors (Netherlands), and NVIDIA Corporation (US), among others.
Get online access to the report on the World's First Market Intelligence Cloud
- Easy to Download Historical Data & Forecast Numbers
- Company Analysis Dashboard for high growth potential opportunities
- Research Analyst Access for customization & queries
- Competitor Analysis with Interactive dashboard
- Latest News, Updates & Trend analysis
Request Sample Scope of the Report
Get online access to the report on the World's First Market Intelligence Cloud
- Easy to Download Historical Data & Forecast Numbers
- Company Analysis Dashboard for high growth potential opportunities
- Research Analyst Access for customization & queries
- Competitor Analysis with Interactive dashboard
- Latest News, Updates & Trend analysis
Report Metric |
Details |
Market size available for years |
2018–2030 |
Base year considered |
2022 |
Forecast period |
2023-2030 |
Forecast units |
Value (USD Million/Billion) |
Segments covered |
Software Layer, ICE Application, EV Application, Vehicle Type, and Region |
Geographies covered |
Asia Pacific, North America, Europe, Latin America and Rest of the World |
Companies Covered |
Robert Bosch GmbH (Germany), NVIDIA Corporation (US), NXP Semiconductors (Netherlands), BlackBerry Limited (Canada), and Continental AG (Germany). |
This research report categorizes the automotive software market based on software layer, ICE application, EV application, vehicle type, and region
Automotive Software Market, By Software Layer:
- Operating System
- Middleware
- Application Software
Automotive Software Market, By ICE Application:
- ADAS & Safety Systems
- Autonomous Driving
- Body & Comfort Systems
- Infotainment Systems
- Engine Management & Powertrain
- Vehicle Telematics
Automotive Software Market, By EV Application:
- Battery Management Systems
- ADAS & Safety Systems
- Autonomous Driving
- Body Control & Comfort Systems
- Infotainment Systems
- Electric Drive
- Engine Management & Powertrain
- Vehicle Telematics
Automotive Software Market, By Vehicle Type:
- Passenger Cars
- Light Commercial Vehicles
- Heavy Commercial Vehicles
Automotive Software Market, By Region
- North America
- Europe
- Asia Pacific
- Latin America
- RoW
Recent Developments
- In September 2023, Robert Bosch Gmbh announced the Vehicle Dynamics Control 2.0 at IAA Mobility 2023. This software will provide better handling and safety of vehicles through intervention in the braking system, electric powertrain, and electric steering system, resulting in less counter-steering and a shorter braking distance.
- In September 2023, NXP Semiconductors collaborated with Elektrobit, a leading AUTOSAR and Linux software provider, to develop software for next-generation automotive battery management systems. The software will reduce the entry-level cost of battery management system (BMS) development and enhance the ease of use of NXP’s high-voltage BMS reference design (HVBMS RD).
- In May 2023, BlackBerry Limited released QNX Software Development Platform (SDP) 8.0 that enables automakers and IoT system developers to deliver more powerful products at lower costs, while maintaining the unparalleled safety, security and reliability standards of QNX technology.
- In February 2022, Jaguar Land Rover formed a multi-year strategic partnership with NVIDIA Corporation to develop and deliver next-generation automated driving systems and AI-enabled services and experiences for its customers. Starting in 2025, all new Jaguar and Land Rover vehicles will be built on the NVIDIA DRIVE software-defined platform, delivering a wide spectrum of active safety, automated driving, parking systems, and driver assistance systems.
Frequently Asked Questions (FAQ):
What is the current size of the global automotive software market?
The global automotive software market is estimated to be USD 19.0 billion in 2023 and projected to reach USD 32.3 billion by 2030.
Who are the winners in the global automotive software market?
The automotive software market is dominated by global players such as Robert Bosch GmbH (Germany), NXP Semiconductors (Netherlands), BlackBerry Limited (Canada), Continental AG (Germany), and NVIDIA Corporation (US), among others. These companies develop new products, adopt expansion strategies, and undertake collaborations, partnerships, and mergers & acquisitions to gain traction in the automotive software market.
What are the new market trends impacting the growth of the automotive software market?
The new market trend such as countries shifting to L2 & L3 autonomy and rising acceptance of autonomous technology.
Which region is expected to be the largest market during the forecast period?
Asia Pacific is anticipated to be the largest market in the automotive software market due to the increasing integration of ADAS features in vehicles by automotive OEMs.
What is the total CAGR expected to be recorded for the automotive software market during 2023-2030?
The CAGR is expected to record a CAGR of 7.8% from 2023-2030.
To speak to our analyst for a discussion on the above findings, click Speak to Analyst
The study involved four major activities to estimate the current size of the automotive software market. Exhaustive secondary research was done to collect information on the market, the peer market, and model mapping. The next step was to validate these findings, assumptions, and sizing with the industry experts across value chains through primary research. The bottom-up and top-down approaches were employed to estimate the total market size. After that, market breakdown and data triangulation were used for determining the market size of segments and subsegments.
Secondary Research
Secondary sources referred to for this research study included automotive industry organizations involved with automotive software; publications from government sources [such as country level automotive associations and organizations, Organisation for Economic Co-operation and Development (OECD), World Bank, CDC, and Eurostat]; corporate filings (annual reports, investor presentations, and financial statements); and trade, business, and automotive associations. Secondary data was collected and analyzed to arrive at the overall market size, which was further validated through primary research.
Primary Research
Extensive primary research was conducted after acquiring an understanding of the automotive software market scenario through secondary research. Several primary interviews were conducted with market experts from both the demand (OEMs) and supply (automotive software providers, technology providers, and component manufacturers) sides across major regions, namely North America, Europe, Asia Pacific, Latin America, and the Rest of the World. Approximately 40% and 60% of primary interviews were conducted from the demand and supply sides, respectively. Primary data was collected through questionnaires, emails, and telephonic interviews.
In the canvassing of primaries, various departments within organizations, such as sales, operations, and marketing, were covered to provide a holistic viewpoint in the report. After interacting with industry experts, brief sessions were conducted with highly experienced independent consultants to reinforce the findings from primaries. This, along with the in-house subject matter experts’ opinions, led to the findings described in the remainder of this report.
To know about the assumptions considered for the study, download the pdf brochure
Market Size Estimation
The bottom-up and top-down approaches have been used to estimate and validate the size of the automotive software market. The market, by vehicle type, in terms of value, is derived by identifying the value of software for each application for all vehicle types at the country level. The value of software is derived by multiplying the vehicle production at country level for each vehicle type with the penetration of each ICE applications. This value is further multiplied with number of ECUs per application and the software cost of ECU per application at country level. The country-level market is summed up to derive the regional market, and the regional market is summed up to derive the global market. A similar approach is applied to derive the market for EV applications.
- The key players in the industry and markets have been identified through extensive secondary research.
- The industry’s future supply chain and market size, in terms of value, have been determined through primary and secondary research processes.
- All percentage shares, splits, and breakdowns have been determined using secondary sources and verified through primary sources.
Global Automotive Software Market Size: Bottom-Up Approach
To know about the assumptions considered for the study, Request for Free Sample Report
Data Triangulation
After arriving at the overall market size of the global market through the above-mentioned methodology, this market was split into several segments and subsegments. The data triangulation and market breakdown procedure were employed, wherever applicable, to complete the overall market engineering process and arrive at the exact market value data for the key segments and subsegments. The extrapolated market data was triangulated by studying various macro indicators and regional trends from both the demand- and supply-side participants.
Market Definition
Automotive Software: Automotive software is a collected programmable data instruction used for performing operations of computer-based in-vehicle applications. It also refers to the software used for in-vehicle embedded systems. Computer-based in-vehicle applications include telematics, infotainment, powertrain, body control and comfort, communication, advanced driver assistance systems (ADAS), and safety
Key Stakeholders
- ADAS Manufacturers
- Associations, Forums, and Alliances Related to Automotive Software
- Authorized and Independent Automobile Service Centers
- Automotive Component Manufacturers
- Automotive Cybersecurity Providers
- Automotive Dealers and Distributors
- Automotive Electronic Control Unit Manufacturers
- Automotive OEMs
- Automotive Software Consortiums
- Automotive Component Manufacturers
- Automotive Software Manufacturers
- Automotive Telematics Control Unit Manufacturers
- Autonomous Vehicle Manufacturers
- Autonomous Vehicle System Suppliers
- ECU Manufacturers
- Electrical and Electronic Component Suppliers
- EV Charging Manufacturers and Service Providers
- EV Component Manufacturers
- EV Manufacturers
- Legal and Regulatory Authorities
- Raw Material Suppliers for Automotive OEMs
- Raw Material Suppliers for Automotive Software or Components
- Sensor Manufacturers
- Vehicle Safety Regulatory Bodies
- Network Providers
- SOS Services Providers
Report Objectives
- To define, describe, and forecast the global automotive software market based on software layer, ICE application, EV application, vehicle type, and region
- To segment and forecast the market size by software layer (operating system, middleware, and application software)
- To segment and forecast the market size by ICE application (ADAS & safety systems, autonomous driving, body & comfort systems, infotainment systems, engine management & powertrain, and vehicle telematics)
- To segment and forecast the market size by EV application (electric drive, battery management systems, ADAS & safety systems, autonomous driving, body control & comfort systems, infotainment systems, engine management & powertrain, and vehicle telematics)
- To segment and forecast the market size by vehicle type (passenger cars, light commercial vehicles, and heavy commercial vehicles)
- To forecast the market size with respect to key regions, namely Asia Pacific, Europe, North America, Latin America, and the Rest of the World
Available Customizations
With the given market data, MarketsandMarkets offers customizations in accordance to the company’s specific needs.
- Automotive Software Market, by EV Application, at Country Level (for countries covered in the report)
- Automotive Software Market, by Vehicle Type, at Country Level (for countries covered in the report)
- Profiling of Additional Market Players (Up to 5)
Growth opportunities and latent adjacency in Automotive Software Market
Great job! Hats off to your clarity, your article was very informative and it was very useful for developers.