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Automotive Software Market Analysis

The Automotive Software Market size is estimated at USD 10.07 billion in 2024, and is expected to reach USD 29.30 billion by 2029, growing at a CAGR of greater than 22% during the forecast period (2024-2029).

According to the market analysis, factors such as the adoption of ADAS features in vehicles, increasing adoption of connected car services, and intervention of innovative technologies for advanced UI are expected to drive the global market growth. As a result, the growth trajectory of this market is strongly correlated to the deployment of software in various applications such as entertainment and security. Growth in the electric mobility industry in countries like India and China is creating a positive outlook for the market. 

According to the International Energy Agency, in Q1 2024, electric car sales grew by around 25% compared to Q1 2023, with China holding the largest share of 45% in electric car sales, followed by Europe with 25%. 

The utilization of open-source platforms and the improved product offerings focused on user experience boosted the market growth for automotive software. Consumers and OEMs are increasingly focusing on automobile infotainment systems, and manufacturers are competing primarily on the software or operating system they utilize. Manufacturers emphasize smart capabilities in these infotainment systems and deploy software that will set their products apart from their competitors. 

Another major trend in the automotive software market is the emergence of autonomous driving technologies. These technologies use advanced sensors, machine learning algorithms, and real-time data processing to allow vehicles to navigate and make decisions without human input. Industry analysis indicates that this technology is expected to revolutionize the automotive industry and transform how we think about transportation. 

Considering the scenario, various manufacturers are focusing on upgrading their technologies for vehicles and on technological advances in the software industry. For example: 

• In December 2023, global technology services provider FPT officially launched its automotive technology subsidiary FPT Automotive with a comprehensive suite of engineering services encompassing in-vehicle infotainment, electronic control units (ECU), functional safety, security, automotive UI/UX design, wireless connectivity, and digital engineering. 

The automotive software market growth is also driven by the need for more efficient and sustainable transportation systems. Governments worldwide are implementing regulations to reduce emissions and promote electric vehicles. Automotive software plays a key role in helping automakers develop more efficient and eco-friendly vehicles. 

Automotive Software Industry Segmentation

Automotive software refers to the computer programs, applications, and systems used in designing, manufacturing, operating, and maintaining automobiles, including the software used in developing and operating vehicle components and systems. 

The automotive software market is segmented by application, vehicle type, and geography. By application type, the market is segmented by safety and security, infotainment and instrument cluster, vehicle connectivity, and other applications (powertrain). By vehicle type, the market is segmented by passenger cars and commercial vehicles. By geography, the market is segmented by North America, Europe, Asia-Pacific, and Rest of the World. The report offers market forecast and size in value (USD) for all the above-mentioned segments.