Global Automotive Software Market to Reach $28.9 Billion by 2026

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Mar 10, 2022, 10:40 ET

SAN FRANCISCO, March 10, 2022 /PRNewswire/ -- A new market study published by Global Industry Analysts Inc., (GIA) the premier market research company, today released its report titled "Automotive Software - Global Market Trajectory & Analytics". The report presents fresh perspectives on opportunities and challenges in a significantly transformed post COVID-19 marketplace.

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Edition: 16; Released: March 2022
Executive Pool: 38869
Companies: 236 - Players covered include Airbiquity, Inc.; Apple, Inc.; Aptiv PLC; Bosch Software Innovations GmbH; Denso Corporation; Elektrobit; ETAS; Google Inc.; Green Hills Software Inc.; Intel Corporation; International Business Machines Corporation; Lectronix, Inc; Luxoft Global Operations GmbH; Lynx Software Technologies, Inc.; Microsoft Corporation; MSC Software Corporation; Nuance Communications, Inc.; NVIDIA Corporation; NXP Semiconductors N.V.; Oxbotica LTD; Tesla Motors Inc.; The MathWorks, Inc.; Vector Informatik GmbH; Wind River Systems, Inc and Others.
Coverage: All major geographies and key segments
Segments: Product (Application Software, Middleware, Operating System); Application (Safety Systems, Infotainment & Telematics, Powertrain, Other Applications); End-Use (Passenger Cars, Commercial Vehicles)
Geographies: World; USA; Canada; Japan; China; Europe; France; Germany; Italy; UK; Spain; Russia; Rest of Europe; Asia-Pacific; Australia; India; South Korea; Rest of Asia-Pacific; Latin America; Brazil; Mexico; Rest of Latin America; Rest of World.

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ABSTRACT-
Global Automotive Software Market to Reach $28.9 Billion by 2026

Automotive software can be defined as any software, either embedded software or firmware, which can enable several advanced products/applications in an automobile, thus helping to expand usage benefits and appeal of modern-day vehicles. Also referred as software for in-vehicle embedded systems, automotive software covers programmable data instructions used to execute various tasks of in-vehicle computer-based applications such as infotainment, telematics, communication, body control & comfort, powertrain, safety and advanced driver assistance systems (ADAS). Growth in the global market is being driven by

due to increasing influx of emerging and advanced technologies into vehicle models to improve functionality, safety and the driving experience. The incorporation of new features and increasing use of connectivity services for communication and real-time data transfer are creating a strong demand for automotive software solutions offering high convenience and utility to customers. Global uptake of automotive software is also favored by stringent regulations pertaining to safety and fuel efficiency coupled with incorporation of electronics-based driving safety and comfort systems. Mandatory installation of e-call systems and rear-view cameras in all vehicles for reducing the chances of back-over accidents are bound to augment the market growth.

The automotive software market received a major setback from severe impact of COVID-19 on the automotive industry. The pandemic resulted in a notable decline in investments and demand, leaving mobility players and automotive OEMs struggling with low revenues. The COVID-19 pandemic may dent several segments of the automotive industry over the long-term owing to the macroeconomic scenario, regulatory developments and changes in consumer behavior. In addition, the situation is anticipated to result in short-term disruptions related to development and rollout of autonomous vehicles, which is bound to affect associated technologies. However, the market is set to bounce back and display a healthy growth in the coming years. Moreover, factors such as emergence of AI and 5G technologies, data monetization within the automotive ecosystem, and developments related to semi- and fully-autonomous vehicles are anticipated to provide lucrative growth opportunities for the automotive software market over the short-term.

Amid the COVID-19 crisis, the global market for Automotive Software estimated at US$19.5 Billion in the year 2022, is projected to reach a revised size of US$28.9 Billion by 2026, growing at a CAGR of 8.9% over the analysis period. Application Software, one of the segments analyzed in the report, is projected to grow at a 9.7% CAGR to reach US$17.8 Billion by the end of the analysis period. After a thorough analysis of the business implications of the pandemic and its induced economic crisis, growth in the Middleware segment is readjusted to a revised 8.5% CAGR for the next 7-year period. This segment currently accounts for a 30.5% share of the global Automotive Software market. Application software is the software layer designed for helping the users to run applications developed and defined by vehicle manufacturers and incorporated in vehicles to perform single or multiple tasks. The increasing integration of infotainment and telematics services is driving the demand for application software. Middleware represents the software layer that resides between operating systems and application components. Middleware software manages application components that run on distributed hosts, and primarily establishes communications between applications and the back end.

The U.S. Market is Estimated at $3.1 Billion in 2022, While China is Forecast to Reach $8.1 Billion by 2026
The Automotive Software market in the U.S. is estimated at US$3.1 Billion in the year 2022. The country currently accounts for a 15.9% share in the global market. China, the world's second largest economy, is forecast to reach an estimated market size of US$8.1 Billion in the year 2026 trailing a CAGR of 10.4% through the analysis period. Among the other noteworthy geographic markets are Japan and Canada, each forecast to grow at 6.7% and 7.3% respectively over the analysis period. Within Europe, Germany is forecast to grow at approximately 8.2% CAGR while Rest of European market (as defined in the study) will reach US$1.4 Billion by the end of the analysis period. The market growth in Asia-Pacific region is favored by increasing adoption of connected mobility and smart transport systems. The market growth is also stimulated by enforcement of stringent emission regulations in countries like Japan, China and India, driving the adoption of automotive software for powertrain and engine management systems. Europe represents the second largest regional market and growth is being driven by rising concerns pertaining to vehicle and driver safety along with the resulting implementation of smart transportation systems.

Operating System Segment to Reach $4.2 Billion by 2026
An operating system is the software that consists of data and programs, which efficiently manage the automotive component hardware and enables the execution of application software. The operating system functions as an intermediary between component hardware and application programs for hardware functions like output/input and memory allocation. Growth in the operating system segment is attributable to implementation of sophisticated software in automobiles. In the global Operating System segment, USA, Canada, Japan, China and Europe will drive the 6.4% CAGR estimated for this segment. These regional markets accounting for a combined market size of US$2.3 Billion will reach a projected size of US$3.8 Billion by the close of the analysis period. China will remain among the fastest growing in this cluster of regional markets. Led by countries such as Australia, India, and South Korea, the market in Asia-Pacific is forecast to reach US$510.4 Million by the year 2026, while Latin America will expand at a 7.4% CAGR through the analysis period. More

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