Automotive Cybersecurity Market Size, Share, Analysis, Report, 2030

[359 Pages Report] The global automotive cybersecurity market size is projected to grow from USD 2.5 billion in 2023 to USD 6.0 billion by 2028, at a CAGR of 18.5%. Increasing adoption of connected vehicles has in turn increased the electronic content per vehicle. This has eventually raised the vulnerability of a vehicle against a cyber-attack, which resulted in recall of vehicles by the reputaed automakers in the recent past. Thereby, the demand for automotive cybersecurity solutions are growing at a rapid pace all over the world. Moreover, advent of software-defined vehicles in conjunction with growing cloud-based applications in automotive sector are also expected to create lucrative opportunities for the automotive cybersecurity market in the coming years globally.

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Automotive Cybersecurity Market Dynamics:

Driver: Electric vehicles more vulnerable to cyber attacks

Electric vehicles are equipped with advanced connected vehicle technology, which allows EVs to communicate with other vehicles, infrastructure, and various online services. This connectivity increases the vulnerability of vehicles to cyber threats. As EV sales rise, the need for robust cybersecurity solutions will become even more critical to protect these connected systems from potential attacks. As such, the global sales of EVs increased by 55% in 2022 to 10.5 million units from the previous year. China led the way with an 82% growth in new energy vehicle (NEV) sales, and BYD became the global sales leader.

The demand for automotive cybersecurity is likely to grow along with the growing demand for electric vehicles. Moreover, with reputed automakers such as BMW, General Motors, Volvo, Daimler, Stellantis, Toyota, and Volkswagen planning to either partially or completely phase out the production of ICE-powered vehicles by 2030, the demand for electric vehicles is expected to increase in turn, driving the demand for automotive cybersecurity solutions globally.

Restraint: Complex ecosystem with multiple stakeholders

The automotive sector has been a focus area for many non-automotive technology companies as the value chain is fragmented, and revenue distribution has become a challenge for stakeholders. The development of countermeasures is challenging because of the lack of standardization of cybersecurity solutions. The solutions for cybersecurity depend on the specifications given by the automotive OEMs. These solutions vary due to the use of different platforms in the same vehicle model, differences in the electronic architecture, and different features in the vehicle. As a result, automotive cybersecurity solution providers face integration risks in dealing with threats and vulnerabilities of a vehicle.

The inherited nature of OEMs to buy all the components for a vehicle from various suppliers and assemble them into one vehicle can make the car more vulnerable. Every supplier has its platform of electronic components, and it would be challenging to integrate all the electronic components of different suppliers. Poor integration of these components can lead to cyberattacks regardless of the strength of individual components. Hence, it is necessary to release standards for cybersecurity products and services throughout the stakeholders of the value chain to make vehicles less vulnerable to cyberattacks.

Opportunity: Advent of software-defined vehicles

The automotive sector has started shifting its focus toward software-centric vehicles. The features and functions of these vehicles are primarily enabled through automotive software. Today, most premium vehicles have up to 150 million lines of software codes, which are typically proportionate among hundreds of electronic control units (ECUs) and a rising number of cameras, RADAR, and light detection and ranging (LiDAR) devices, among others.

Software-defined vehicles have several advantages. For instance, software upgrades pertaining to vehicle infotainment systems, telematics, vehicle diagnostic systems, and others will require a trip to the dealership. However, with software-defined vehicles, customers will be able to receive over-the-air (OTA) updates that cover infotainment improvements, security patches, and the monitoring & tuning of core functionalities, such as powertrain and vehicle dynamics. This will increase the demand for software-defined vehicles, in turn creating growth opportunities for the automotive cybersecurity market during the forecast period.

Challenge: Time lag in delivery of cybersecurity updates

Most of the automobile manufacturers do not have any necessary software development capabilities. The automobile manufacturers are only responsible for integrating the cybersecurity solution with the hardware of the vehicle, while the rest is the responsibility of the cybersecurity providers. Hence, due to the absence of robust capabilities within automobile manufacturing plants and service centers, the time lag in rectifying the identified vulnerabilities increases. The security code update development is a time-taking process due to back-end system records, which hampers the whole process of delivering updates to the market without any delay.

The timely delivery of the security package at the time of vehicle recalls becomes a big challenge for OEMs. Providers of cybersecurity solutions need to expedite the development processes such as risk management, progress monitoring and reporting, and incident management, followed by delivering them to the production and service centers of automobile manufacturers. The cybersecurity solution providers look for new ways to reduce the time lag for updates as it would give them a competitive edge over their competitors. Hence, product innovation and accuracy are crucial for the effective implementation of cybersecurity solutions.

Automotive Cybersecurity Market Ecosystem

The ecosystem analysis highlights various players in the automotive cybersecurity ecosystem, which is primarily represented by OEMs, tier 1 integrators/suppliers, tier 2 suppliers, and automotive cybersecurity solution providers. Prominent companies in this market include Continental AG (Germany), Robert Bosch GmbH (Germany), Harman International (US), DENSO Corporation (Japan), and Aptiv PLC (Ireland), among others.

Software segment is expected to witness significant growth rate in the global automotive cybersecurity market during the forecast period

The software segment is expected to have a larger share in the market during the forecast period. This is owing to the increasing penetration of connected vehicles, and rising adoption of ADAS features in vehicles. Thus, increasing new features in vehicles is likely to support the software segment of the market during the forecast period.

Asia Pacific and North America dominate the software segment of the market. The software segment is projected to grow at the highest rate in Asia Pacific during the forecast period. Automotive OEMs in Japan and South Korea are launching new vehicle models that are equipped with modern connectivity technologies. These OEMs specify their requirements and designs to vendors for the cybersecurity of their vehicles. Vehicle cybersecurity providers and Tier I suppliers develop the actual software as well as functional components for various vehicles.

ICE vehicles segment is expected to be the largest in automotive cybersecurity market during the forecast period

Modern ICE vehicles are equipped with various connected features, such as infotainment systems, GPS navigation, and wireless connectivity. These features introduce potential vulnerabilities that can be exploited by hackers to gain unauthorized access to the vehicle’s systems. Cybersecurity measures are necessary to protect against unauthorized control or manipulation of critical functions, ensuring the safety and privacy of the occupants. This, in turn, is expected to bolster the ICE vehicles segment of the market during the forecast period.

Passenger vehicles segment is expected to be the largest in automotive cybersecurity market during the forecast period

The passenger cars segment accounts for the largest share of the market, owing to increased investments toward autonomous mobility, the advent of software-defined cars, and growing sales of L2 autonomous vehicles, among others.

The production and sales of luxury and mid-size vehicles are increasing in Asia Pacific, and OEMs are coming up with new models in the mid-size vehicle class that is equipped with connected and ADAS features. Hence, the increasing sales of luxury class vehicles in developing countries, such as China and India, are expected to drive the passenger cars segment of the market in Asia Pacific. In Europe, the passenger cars segment is expected to witness growth during the forecast period due to the increasing sales of Level 2 autonomy vehicles in the region.

“The Asia pacific automotive cybersecurity market is projected to hold the largest share by 2028.”

Asia Pacific is estimated to account for the largest market share in 2023, followed by Europe and North America. Countries such as China, India, Japan, South Korea, and the Rest of Asia Pacific are considered under Asia Pacific for market analysis. One of the key factors driving the market growth in this region is the large production of passenger vehicles, coupled with the increasing penetration of connected cars and other advanced technologies. China and India are considered manufacturing hubs for the automotive industry. . In addition, the increasing purchasing power of the population and rising concerns over vehicle pollution have triggered the demand for electric vehicles and semi-autonomous vehicles in Asia Pacific. This in turn would also drive the market growth for automotive cybersecurity.

Key Market Players

The global automotive cybersecurity market is dominated by major players such as Continental AG (Germany), Robert Bosch GmbH (Germany), Harman International (US), DENSO Corporation (Japan), Aptiv PLC (Ireland), and Karamba Security (Israel), among others. These companies have secure distribution networks at a global level and offer a wide range of cybersecurity products for traditional as well as electric vehicle. The key strategies adopted by these companies to sustain their market position are collaborations, new product developments, acquisitions, etc.

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Scope of the Report

This research report categorizes the automotive cybersecurity market based on application type, offering, form type, security type, vehicle type, propulsion type, vehicle autonomy, electric vehicle application type, and region

Based on Offering:

• Software
• Hardware

Based on Application:

• ADAS & safety
• Body control & comfort
• Infotainment
• Telematics
• Powertrain systems
• Communication systems

Based on Form Type

• In-vehicle
• External cloud services

Based on Security Type

• Application
• Wireless
• Endpoint

Based on Approach

• Intrusion Detection System
• Security Operations Centre

Based on Vehicle Type:

• Passenger Vehicles
• Light Commercial Vehicles
• Heavy Commercial Vehicles

Based on Propulsion Type:

• ICE Vehicles
• Electric  Vehicles

Based on Vehicle Autonomy:

• Non-autonomous Vehicles
• Semi-autonomous Vehicles
• Autonomous Vehicles

Based on EV Application:

• ADAS & safety
• Body control & comfort
• Infotainment
• Telematics
• BMS & powertrain systems
• Communication systems
• Charging management

Based on the Region:

• Asia Pacific
  • China
  • India
  • Japan
  • South Korea
  • Rest of Asia Pacific
• North America
  • US
  • Canada
  • Mexico
• Europe
  • France
  • Germany
  • Russia
  • Turkey
  • UK
  • Rest of Europe
• Rest of the World
  • Brazil
  • South Africa
  • Others in RoW

Recent Developments

• In February 2023, ETAS (a subsidiary of Robert Bosch GmbH) offered ESCRYPT C_ycurRISK, a software tool for threat analysis and risk assessment. It allows the automotive OEMs and suppliers to identify security vulnerabilities during vehicle development and reduce cyber risks systematically.
• In January 2023, HL Mando Corporation collaborated  with Argus Cyber Security. Through this collaboration, the Argus CAN Intrusion Detection Systems (IDS) solution was applied to HL Mando’s electrification system products, such as brakes and steering, beginning in January 2023.
• In October 2022, NTT Communications Corporation, along with DENSO Corporation (DENSO), was supposed to develop the security operation center technology for vehicles (VSOC1) to respond to the threat of increasingly sophisticated cyber-attacks against vehicles.
• In November 2022, Garrett Motion Inc. developed multi-layered on-and-off board intrusion detection systems (IDS) to identify cyber threats, which support OEMs to enhance vehicle security.
• In November 2021, NXP Semiconductors collaborated with Ford Motor Company to deliver enhanced driver experiences, convenience, and services like over-the-air updates across its global fleet of vehicles, including the 2021 Ford F-150 pickup, Mustang Mach-E, and Bronco SUVs.
• In October 2021, Renesas Electronic Corporation acquired Celeno Communications (Israel) to develop more advanced Wi-Fi connectivity capabilities to deliver end-to-end connectivity solutions for clients and access points.
• In September 2021, Harman International collaborated with Renault (France) to provide the Harman Kardon sound system to the Renault Mégane E-TECH 100% electric that is expected to be launched in 2022.
• In July 2021, ETAS Korea, a subsidiary of Robert Bosch GmbH, signed a partnership agreement with Suresoft Tech Co., Ltd. (South Korea) to offer consulting services and solutions related to cybersecurity testing of in-vehicle systems to Korean automotive manufacturers and suppliers.
• In July 2021, NXP Semiconductors collaborated with Moter Technologies, Inc. (US) to combine its new S32G2 high-performance automotive processors with MOTER’s insurance data science expertise and software. This is expected to enable vehicle data monetization with new and improved automotive insurance services.
• In May 2021, ESCRYPT, a subsidiary of ETAS Inc, which is a subsidiary of Robert Bosch GmbH, partnered with Alyne GmbH and KPMG to offer joint expertise in developing the Product Security Organisation Framework (PROOF).

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