Quantum Computing in Automotive Market

[203 Pages Report] The quantum computing in automotive market is estimated to grow from USD 143 million in 2026 to USD 5,203 million by 2035, at a CAGR of 49.0% from 2026 to 2035. The growth of this quantum computing in automotive market is driven by rising investment by automotive companies to deploy advanced & innovative technology to solve complex problems and increasing government focus on evolving quantum computing expertise across various industry applications.

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Market Dynamics

Driver: Increase in government investment

Quantum computing is in the infancy stage. The development of scalable quantum computer technology requires many dedicated investments to unlock the future potential of critical applications so that different optimization and simulation strategies can be implemented with quantum computers. Regional governments worldwide are investing in the development of quantum computing technology to initiate pilot projects across various applications. Different nations are funding their research institutions with substantial money to further the development of quantum computing. China, the US, and European countries such as Germany, France, Sweden, Netherlands, India, and Japan are some of the frontrunners for investments in quantum computing. Small countries like Canada, Australia, and Israel are joining the race to develop quantum computing technologies. These countries are investing in developing R&D infrastructure specialized for quantum computing space.

Restraint: Stability and quantum error correction issues

Currently, quantum computers use physical qubits, which are error-prone. To achieve a single logical qubit error free, 1,000 physical qubits are reportedly required, a goal that has not yet been accomplished. A commercially viable quantum computer is expected to be a 200-logical qubit machine with 200,000 physical qubits, even though devices with up to 5,000 physical qubits have already been produced as of 2020. This is one of the major challenges to commercially introducing quantum computers. Due to their fragility and ease of disruption by changes in their environment's temperature, noise, and frequency, qubits cannot be kept in their quantum mechanical state for a longer time. Moreover, many blockchain-based solutions rely on the elliptic curve signature algorithm, which is currently not quantum-safe. The continuously changing mechanical state of quantum due to difficulties in building a commercialized quantum machine restricts the development of physical quantum computers.

Opportunities: Rise in sales of electric and hybrid electric vehicle

The rising adoption of BEVs and HEVs would force automotive companies to improve on various EVs, such as vehicle architecture, driving range, fast charging capabilities, etc. With reference to quantum computing can help in trying and building several material compositions under different test conditions. Quantum computing automotive for an electric vehicle can perform battery material research, battery optimization & simulations, and battery thermal management systems. Few collaborations have occurred in recent years to perform such activities and achieve an optimal outcome. In 2022, Hyundai Motor Company (South Korea) and IonQ (US) formed a technical collaboration to simulate EV battery chemical reactions using quantum computing technology. In 2020, Mercedes-Benz (Germany) and IBM Corporation formed a technical collaboration to develop next-generation lithium-sulfur batteries using quantum computing technology. An increasing sale of electric vehicles will create the demand for improved batteries and unlock exponential growth opportunities for various automotive and other hardware, software, and platform providers for quantum computing.

Challenges: Lack of Skilled Professionals and Infrastructure

Quantum Computing is an innovative and promising technology. A team of experts with the necessary skillsets is required to deploy this technology. The companies in this business face challenge of finding people with the required skill sets. Many countries and quantum computer manufacturers plan to launch training programs to address the shortage of skilled professionals. For instance, D-Wave Systems, inc. started training modules to train its client about quantum computers. However, the cost of this training module is one obstacle to companies wishing to train their employees. Further, these components are complicated, and understanding them takes time and effort. As a result, quantum computer manufacturers must invest more money in various post-sales activities to reduce their profit margins.

Quantum computing in Automotive Market Ecosystem

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Cloud-based quantum computing is estimated to be the largest market by deployment

The cloud-based segment is projected to lead the quantum computing in automotive market during the review period. Developing highly powerful systems will drive the demand for cloud-based access to quantum computing services. Automotive OEMs and Tier 1 companies focus on cloud-based deployment type, which is cost-effective without needing large physical setup and maintenance. Quantum computing is in the infancy stage and prone to rapidly advancing several hardware and software updates quickly, owing to constant development activities to make technology more efficient and error-free. Thus, the cloud model enables automotive companies to access the latest updates. Microsoft Corporation, Amazon, Alibaba, and D-wave Systems Inc. offers a sustainable cloud platform for quantum computing access that can suit the environment easily.

Automotive tier 1 and 2 segments are expected to grow at the fastest CAGR during the forecast period

Automotive tier 1 and 2 companies are projected to grow at the fastest CAGR for the quantum computing in automotive industry from 2026 to 2035. At present, most vehicle manufacturers are exploring quantum computing capabilities, and a few tier 1 and tier 2 players are also following these strategic developments and would examine future potential across the automotive industry. Tier 1 players can use Quantum computing to design and optimize cutting-edge components and systems, improve the design of vehicle parts using lightweight structure, enhanced battery, motor design and other related components, autonomous driving mechanism, etc., which will be provided to OEMs. Moreover, quantum computing will also be helpful for Tier 2 companies in material research and production procedures, decrease waste, boost productivity, and create innovative products. These newly developed products can optimize their supply chain management with quantum computers, lowering costs, boosting efficiency, and creating brand-new cutting-edge parts and systems. Global automotive companies such as Robert Bosch, AISIN Group, and Denso Corporation have tie-ups with quantum computing technology providers to study and gain important insights into material research and fluid dynamics. Hence, quantum computing has significant potential to transform and lead the industry's innovation process for Tier 1 and Tier 2 organizations covering a broad spectrum of research areas.

Americas is projected to be the largest market during the forecast period

Americas is projected to dominate quantum computing in automotive market from 2026 to 2035. The region's dominance is mainly due to the early adoption of quantum computing systems and supported software and services owing to the presence of major technology companies such as IBM Corporation, Microsoft Corporation, Alphabet Inc., D-Wave Systems Inc., Rigetti Computing, and Zapata Computing, among others. These companies have a technological advantage and abundant capital to invest in innovations. For instance, IBM Corporation has initiated R&D efforts on quantum computing since 1998. Alphabet Inc., Microsoft Corporation, D-wave Systems Inc., IonQ, etc., are some frontrunners in experimenting with quantum computing technologies. These companies can offer quantum computing solutions for the automotive industry and can help provide some real use cases leveraging quantum computing technology.

Key Market Players & Start-ups

Quantum computing in automotive market is led by globally established players such as IBM Corporation (US), Microsoft Corporation (US), D-Wave Systems, Inc. (US), Amazon (US), and Rigetti & Co, LLC (US). These companies adopted expansion strategies and undertook collaborations, partnerships, and mergers & acquisitions to gain traction in the high-growth market.

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Scope of the Report

The study categorizes quantum computing in automotive market based on the following segments:

Quantum Computing in Automotive Market By Application Type

• Route Planning and Traffic Management
• Battery Optimization
• Material Research
• Autonomous and Connected Vehicle
• Production Planning and Scheduling
• Others

Quantum Computing in Automotive Market By Component Type

• Software
• Hardware
• Services

Quantum Computing in Automotive Market By Deployment type

• Cloud
• On-premises

Quantum computing in Automotive Market By Stakeholder type

• OEM
• Automotive Tier 1 and 2
• Warehousing and Distribution

Quantum Computing in Automotive Market By Region

• Asia Pacific
• Europe
• Americas

Recent Developments

• In September 2023, Rigetti & Co, LLC launched its QCS on Microsoft's Azure Quantum platform with a public preview. The Aspen-M-2 80-qubit and Aspen-11 40-qubit superconducting quantum processors from Rigetti are available to all Azure Quantum users for the development and execution of quantum applications.
• In January 2023, PASQAL announced the launch of Pulser Studio, a no-code development platform for neutral atoms quantum computers. Pulser Studio enables users to graphically build quantum registers and design pulse sequences without coding knowledge.
• In November 2022, IBM Corporation introduced Next-Generation IBM Quantum System Two and 400 Qubit-Plus Quantum Processors. This processor can perform quantum computations that are much more complex than what can be done on any classical computer.
• In November 2022, IBM Corporation launched its most effective quantum computer, which has three times the number of qubits than its Eagle machine. This new quantum computer with 433 qubit capacity called Osprey is capable of previously insolvable problems.
• In November 2022, Amazon launched its first natural-atom quantum processor for Amazon Bracket. This new processor has been developed with Qu Era technologies and is 256 qubits. This new device is designed to solve optimization problems.
• In October 2022, D-wave Systems Inc. launched its quantum software & services on the AWS marketplace. It makes finding, testing, buying, and deploying software that runs on Amazon Web Services is simple. Customers of the AWS Marketplace will have simple access to a selection of quantum computing products from D-Wave, including the use of the Leap quantum cloud service.
• In May 2022, IonQ introduced its latest generation quantum system IonQ Forte. The new system feature includes innovative, cutting-edge optics technology that increases accuracy and improves IonQ's industry system performance.
• In February 2022, Rigetti & Co, LLC announced the commercial availability of the 80-qubit Aspen-M quantum system through Rigetti Quantum Cloud Services. The technology is accessible to direct and distribution clients (QCS). Rigetti & Co, LLC also reported the results of system speed tests performed on Aspen-M.
• In December 2021, D-wave Systems Inc. launched a new quantum acceleration bundle, the quantum QuickStart, incorporating cloud access and instruction in quantum programming. The Quantum QuickStart bundle offers developers a complete training experience and a month of unlimited, real-time quantum cloud access. It was created to train developers quickly and enable them to effortlessly employ quantum computing and quantum hybrid resources to build quantum apps.
• In December 2021, Rigetti & Co, LLC introduced an 80-qubit Aspen -M next-generation quantum computer.
• In November 2021, IBM Corporation unveiled its new 127-quantum bit (qubit) Eagle processor. It signals the hardware development stage, where quantum circuits can no longer be accurately simulated on a conventional computer.
• In October 2020, D-wave System Inc. announced its next-generation quantum annealing processor chip, which uses quantum effects to solve the minimization and optimization problems.

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