Artificial Intelligence in Automotive Market Is Estimated To Witness High Growth Owing to Increasing Adoption of ADAS and Self-Driving Vehicles
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| Artificial Intelligence in Automotive Market |
The Artificial Intelligence in Automotive Market is estimated to be valued at US$ 2.3 Bn in 2022 and is expected to exhibit a CAGR of 24.1% over the forecast period 2023-2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
Artificial intelligence is widely being adopted in the automotive industry for
various applications such as autonomous driving, predictive maintenance,
customised travel recommendations, and personal assistants among others. In
autonomous vehicles, artificial intelligence helps in object detection, path
planning and control of the vehicle without any human intervention. It analyses
huge amounts of data from cameras, radars and other sensors to recognise
vehicles, pedestrians, road signs etc. and maneuver vehicles accordingly.
Market Dynamics:
The automotive industry is witnessing increasing adoption of advanced driver
assistance systems (ADAS) and self-driving vehicles which is expected to be a
major driver for the artificial intelligence in automotive market during the
forecast period. ADAS utilizes computer vision, sensor fusion, and machine
learning algorithms to detect obstacles on the road and traffic signs. They
provide safety features like emergency braking, adaptive cruise control, lane
departure warning etc.
According to International Data Corporation (IDC),
worldwide shipments of autonomous vehicles (AVs) are expected to reach around
33 million units in 2025. Furthermore, rising investment by key players to
develop AI-based solutions for vehicles and growing demand for personalized in-vehicle
experience is also expected to propel the market growth over the forecast
period. For instance, NVIDIA announced AI assistant for consumer vehicles to
provide functions like voice commands, navigation, app recommendations etc.
Major automobile manufacturers around the world are
integrating AI systems for enhancing safety, convenience, and connectivity
features in vehicles. However, lack of proper infrastructure for advancement of
self-driving vehicles and data privacy & security concerns associated with
AI may hamper the market growth during the assessment period.
The Artificial Intelligence in Automotive market is segmented into hardware, software, and service. The hardware segment dominated the market in 2021 owing to the extensive use of AI chips, GPUs, CPUs and other hardware components for deploying AI systems in vehicles. The high integration of cameras, RADARs and other sensors in modern vehicles has significantly contributed to the large market share of the hardware segment.
PEST Analysis
Political: Governments across the world are supporting the development of self-driving vehicles by coming up with supportive regulations. For instance, the US department of transportation has come up with guidelines to test self-driving cars on public roads.
Economic: The rising disposable incomes and demand for advanced mobility solutions is fueling the growth of the AI in automotive market. Customers are willing to pay more for AI-enabled features in vehicles.
Social: Younger generations are rapidly adopting new technologies. The social demand for autonomous vehicles from Gen X and millennials is driving several automakers to invest in AI-based innovations.
Technological: Advancements in deep learning and machine learning algorithms are facilitating the development of more human-like AI assistants for vehicles. Edge computing is also allowing in-vehicle processing of large AI models.
Key Takeaways
Global Artificial Intelligence In Automotive Market Size is expected to witness high growth, exhibiting CAGR of 24.1% over the forecast period, due to increasing preference for autonomous vehicles. The autonomous vehicles segment is expected to spearhead the growth of AI in automotive market owing to rising investments by OEMs in self-driving car technologies and supportive government regulations for autonomous mobility.
North America captures over 35% share of the global AI in automotive market and is expected to retain its pole position throughout the forecast period. The presence of major automakers like Tesla, GM, and Ford investing heavily in AI-based auto innovations makes North America a lucrative market for AI automotive companies.
Key players operating in the Artificial Intelligence in Automotive market are Qualcomm Inc., Tesla Inc., Volvo Car Corporation, BMW AG, Audi AG, General Motors Company, Ford Motor Company, Toyota Motor Corporation, Hyundai Motor Corporation, Uber Technologies Inc., and Apple Inc. Most of the top players are investing in self-driving car startups to enhance their autonomous driving technology and get an edge over competitors.
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