The global automotive software market is projected to experience significant growth, increasing from USD 19.0 billion in 2023 to USD 32.3 billion by 2030, at a compound annual growth rate (CAGR) of 7.8%, according to a recent research report titled “Automotive Software Market by ICE Application, Software Layer, Vehicle Type, EV Application & Region - Global Forecast to 2030,” by MarketsandMarkets.
The market’s growth is driven by several factors. The rise in focus toward software-defined vehicles and the increasing penetration of advanced driver assistance systems (ADAS) features in vehicles are expected to increase the demand for automotive software solutions. Additionally, strong government support for vehicle safety and the rising adoption of software-over-the-air (SOTA) updates are anticipated to promote the revenue growth of the automotive software market.
The application software segment is expected to have significant growth opportunities in the automotive software market during the forecast period. This growth 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 that require application software to work effectively in a real-time environment.
The ADAS and 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 a mandatory regulation that could significantly impact road safety. The autonomous driving segment is also expected to show significant market growth during the forecast period.
Body control & comfort systems in Battery Electric Vehicles (BEVs) function through automotive software as they are responsible for managing and coordinating the various systems and components of the vehicle. 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 automotive software market is poised for significant growth in the coming years, driven by advancements in technology and increasing demand for connected and autonomous vehicles. As the industry continues to evolve, it will be interesting to see how these trends shape the future of automotive software.
Prominent key players in the market include NVIDIA Corporation (US), Alphabet Inc. (US), Automotive Grade Linux (US), and Green Hill Software (US), among others.
