Connected Car Market

Connected Car Market Size:

The global connected car market size reached USD 96.2 Billion in 2024. Looking forward, IMARC Group expects the market to reach USD 284.0 Billion by 2033, exhibiting a growth rate (CAGR) of 12.8% during 2025-2033. Ongoing advancements in connectivity technologies, an emphasis on safety and security, evolving regulatory landscapes, changing consumer preferences towards personalized and convenient driving experiences, and the integration of diverse connectivity solutions and services are some of the key factors bolstering the market growth.

Connected Car Market Analysis:

• Market Growth and Size: The global connected car market is experiencing robust growth, driven by an increasing demand for advanced connectivity features in vehicles. The market size is expanding significantly as consumers prioritize safety, entertainment, and convenience services in their vehicles.
• Major Market Drivers: Key drivers include technological advancements such as 4G/LTE, 3G, and 5G connectivity, safety regulations, changing consumer preferences, and a focus on driver assistance and vehicle management services. Besides this, the evolving regulatory landscape, particularly in regions like Europe and North America, plays a crucial role in shaping market dynamics.
• Technological Advancements: Continuous technological advancements, especially in connectivity technologies like 5G, are propelling the connected car market forward. These advancements facilitate real-time data exchange, over-the-air updates, and the integration of advanced driver assistance systems (ADAS), contributing to a safer and more connected driving experience.
• Industry Applications: Connected car technologies find applications in diverse industry segments, including safety services, entertainment, vehicle management, and mobility management. These applications cater to both original equipment manufacturers (OEMs) and the aftermarket, addressing a wide range of consumer needs and preferences.
• Key Market Trends: Key trends include the integration of entertainment services, smart mobility solutions, and embedded connectivity solutions in vehicles. Moreover, the market is also witnessing collaboration between traditional automotive manufacturers and technology companies, emphasizing the importance of partnerships in driving innovation.
• Geographical Trends: Geographically, North America leads in the adoption of connected cars due to a tech-savvy consumer base and stringent safety regulations. Asia Pacific is rapidly growing, driven by urbanization and increasing disposable income. Europe benefits from supportive regulatory frameworks, while Latin America and the Middle East witness rising demand driven by infrastructure improvements.
• Competitive Landscape: The competitive landscape is characterized by intense rivalry among established automotive manufacturers, tech giants, and telecommunications companies. Concurrent with this, startups specializing in specific connected car solutions contribute to innovation, resulting in a convergence of traditional and disruptive players.
• Challenges and Opportunities: Challenges include addressing cybersecurity concerns, ensuring regulatory compliance, and meeting diverse consumer demands. Opportunities lie in continued technological innovation, strategic partnerships, and leveraging connectivity to create new and personalized in-car experiences. The market's evolution also presents opportunities for startups and companies focusing on niche solutions.

Connected Car Market Trends:

Significant advancements in connectivity technologies

The continuous evolution of connectivity technologies represents one of the key factors influencing the global connected car market. The shift from traditional standalone vehicles to interconnected smart cars is fueled by the integration of high-speed internet, 4G and 5G networks, and advanced communication protocols. These technologies enable seamless communication between vehicles and the broader transportation ecosystem, facilitating real-time data exchange. Connected cars leverage these advancements to provide a range of features, including real-time traffic updates, remote diagnostics, over-the-air software updates, and enhanced navigation systems. As these technologies mature, the connected car market is poised to expand further, offering a more immersive and safer driving experience.

Rising emphasis on safety and security

Safety and security considerations are key factors strengthening the global connected car market. The integration of ADAS and vehicle-to-everything (V2X) communication plays a pivotal role in enhancing road safety. Connected cars leverage sensors, cameras, and communication modules to collect and transmit data about the vehicle's surroundings, potential hazards, and traffic conditions. This information is not only utilized by the vehicle itself to make informed decisions but is also shared with other connected vehicles and infrastructure, creating a collaborative safety ecosystem. Additionally, connected cars often feature robust cybersecurity measures to protect against potential cyber threats, ensuring the integrity and confidentiality of the data exchanged between vehicles and external systems.

Evolving regulatory landscape

Governments and regulatory bodies worldwide are actively contributing to the growth of the connected car market through the formulation and implementation of supportive policies. In line with this, the introduction of stringent regulations mandating the inclusion of certain safety features and connectivity capabilities in new vehicles, such as the European Union's eCall regulation requiring all new cars to be equipped with an emergency call system, is bolstering the market growth. Such regulations drive the adoption of connected car technologies and create a standardized framework that fosters interoperability and compatibility among different vehicles and infrastructure components, providing an impetus to the market growth.

Changing consumer preferences and expectations

The rising consumer demand for a more connected, personalized, and convenient driving experience is acting as another significant growth-inducing factor. Connected cars cater to these changing preferences by offering features such as in-car infotainment systems, voice-controlled assistants, and integration with smartphones and smart home devices. The ability to remotely control and monitor various aspects of the vehicle, from climate settings to vehicle diagnostics, resonates well with modern consumers seeking enhanced convenience and control, aiding in market expansion. Furthermore, the concept of connected mobility, which includes services like ride-sharing, predictive maintenance, and automated parking, is gaining traction as consumers become more tech-savvy and accustomed to the conveniences offered by connectivity, which is propelling the market forward.

Connected Car Industry Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the market, along with forecasts at the global, regional, and country levels for 2025-2033. Our report has categorized the market based on technology, connectivity solutions, services, and end market.

Breakup by Technology:

• 3G
• 4G/LTE
• 5G
   

4G/LTE accounts for the majority of the market share

The report has provided a detailed breakup and analysis of the market based on the technology. This includes 3G, 4G/LTE, and 5G. According to the report, 4G/LTE represented the largest segment.

The surging demand for 4G/LTE-connected car technologies is primarily propelled by the need for faster and more reliable data transmission. As consumers increasingly expect seamless connectivity and real-time information in their vehicles, 4G/LTE networks provide the necessary bandwidth and low latency required for a diverse range of applications. These networks facilitate high-speed internet access, enabling advanced features such as live traffic updates, in-car streaming services, and over-the-air software updates, thus creating a positive outlook for market expansion.

Besides this, the demand for 3G-connected car technology persists due to its widespread coverage and reliability, facilitating essential connectivity features, such as remote diagnostics and basic navigation services.

Moreover, the burgeoning demand for connected cars powered by 5G stems from its transformative capabilities offering ultra-low latency, high data speeds, and enabling advanced applications like real-time communication for autonomous driving and immersive in-car experiences.

Breakup by Connectivity Solutions:

• Integrated
• Embedded
• Tethered
   

Integrated holds the largest share in the industry

A detailed breakup and analysis of the market based on the connectivity solution have also been provided in the report. This includes integrated, embedded, and tethered. According to the report, integrated accounted for the largest market share.

The demand for connected cars with integrated connectivity solutions is fueled by the desire for seamless and hassle-free user experiences. Integrated solutions, encompassing connectivity features within the vehicle's built-in systems, eliminate the need for external devices or aftermarket installations. This simplicity aligns with consumer preferences for a cohesive and intuitive driving experience, where connectivity is seamlessly integrated into the vehicle's design and functionalities, enhancing convenience and accessibility for users without requiring additional installations or accessories.

Concurrent with this, connected cars with embedded connectivity witness rising demand due to their self-contained systems. Embedded solutions offer a streamlined and permanent integration, ensuring continuous and reliable connectivity, and supporting advanced features like real-time data exchange and over-the-air updates, thereby bolstering the market growth.

Furthermore, the rising popularity of tethered solutions as they leverage external devices like smartphones to provide connectivity among users seeking flexibility and cost-effectiveness is impelling the market growth. Apart from this tethered solutions allow them to utilize existing devices for in-car connectivity without the need for dedicated embedded solutions.

Breakup by Service:

• Driver Assistance
• Safety
• Entertainment
• Vehicle Management
• Mobility Management
• Others
   

Driver assistance represents the leading market segment 

The report has provided a detailed breakup and analysis of the market based on the service. This includes driver assistance, safety, entertainment, vehicle management, mobility management, and others. According to the report, driver assistance represented the largest segment.

The demand for connected cars with driver assistance services is propelled by the increasing focus on enhancing road safety and the overall driving experience. ADAS leverages connectivity to offer features such as lane-keeping assistance, adaptive cruise control, and collision avoidance, contributing to a safer driving environment. As consumers prioritize safety-conscious technologies, the integration of driver assistance services in connected cars becomes a significant driver for market growth.

In confluence with this, the demand for connected cars is driven by the surging need for safety services like automatic emergency calling and collision notifications, contributing to improved emergency response times and overall road safety.

Additionally, connected cars with entertainment services meet consumer demand for in-car infotainment, streaming, and personalized content, enhancing the overall driving experience and catering to changing preferences for entertainment options on the go, which is further aiding in market expansion.

In line with this, the growing demand for connected cars offering vehicle management services like remote diagnostics, predictive maintenance alerts, and over-the-air software updates, enabling efficient vehicle maintenance and performance optimization is boosting the market growth.

Furthermore, the increasing demand for connected cars with mobility management services is influenced by the growing popularity of smart mobility solutions, including features like real-time traffic updates, route optimization, and integration with ride-sharing platforms, contributing to enhanced navigation and convenience.

Apart from this, connected cars catering to a myriad of other services, such as voice-controlled assistants, smart home integration, and personalized driving profiles, are gaining demand as they address diverse consumer needs, providing a holistic and customized connected driving experience.

Breakup by End Market:

• Original Equipment Manufacturer (OEMs)
• Aftermarket
   

Original equipment manufacturer (OEMs) exhibits a clear dominance in the market 

A detailed breakup and analysis of the market based on the end market have also been provided in the report. This includes original equipment manufacturer (OEMs) and aftermarket. According to the report, original equipment manufacturer (OEMs) accounted for the largest market share.

The demand for connected cars from OEMs is driven by the industry's recognition of connectivity as a pivotal element in modern vehicles. As OEMs integrate advanced technologies into their vehicles, including connectivity features like in-car infotainment, safety systems, and remote diagnostics, the demand for connected cars continues to grow. OEMs leverage connectivity to differentiate their products, meet evolving consumer expectations, and stay competitive in a rapidly transforming automotive landscape.

On the other hand, the demand for connected cars in the aftermarket segment is fueled by consumers seeking to upgrade existing vehicles with modern connectivity features. Aftermarket solutions provide an avenue for car owners to enjoy the benefits of connectivity without purchasing a new vehicle. The increasing availability of aftermarket devices and modules allows for the retrofitting of vehicles with features like real-time tracking, in-car Wi-Fi, and advanced safety systems, contributing to the growing demand for connected cars in the aftermarket.

Breakup by Region:

• North America
  • United States
  • Canada
• Asia-Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Indonesia
  • Others
• Europe
  • Germany
  • France
  • United Kingdom
  • Italy
  • Spain
  • Russia
  • Others
• Latin America
  • Brazil
  • Mexico
  • Others
• Middle East and Africa
   

North America leads the market, accounting for the largest connected car market share

The market research report has also provided a comprehensive analysis of all the major regional markets, which include North America (the United States and Canada); Asia Pacific (China, Japan, India, South Korea, Australia, Indonesia, and others); Europe (Germany, France, the United Kingdom, Italy, Spain, Russia, and others); Latin America (Brazil, Mexico, and others); and the Middle East and Africa. According to the report, North America accounted for the largest market share.

North America’s tech-savvy consumer base, stringent safety regulations, and robust telecommunications infrastructure are presenting lucrative opportunities for the growth of the connected cars market. Consumers in the region prioritize advanced connectivity features, leading to increased adoption of connected cars. Along with this, regulatory initiatives focusing on enhancing road safety and the well-established automotive industry collaboration with tech companies contribute to the burgeoning demand for innovative connected technologies in vehicles across North America.

Concurrently, the demand for connected cars in Asia Pacific fueled by rapid urbanization, increasing disposable income, and a tech-forward population is strengthening the market growth. Besides this, the rising consumer expectations for advanced connectivity features contribute to the region's growing market.

Moreover, In Europe, the escalating adoption of connected cars fueled by supportive regulatory frameworks, emphasis on sustainability, and a tech-savvy consumer base, fostering the integration of advanced connectivity technologies in vehicles is aiding in market expansion.

In confluence with this, Latin America's rising demand for connected cars owing to urbanization, increasing awareness of safety features, and a growing middle class is positively impacting the market growth.

Furthermore, the demand for connected cars in the Middle East and Africa is influenced by improving infrastructure, a growing focus on smart cities, and an expanding middle class, driving the adoption of connected technologies in the automotive sector.

Leading Key Players in the Connected Car Industry:

The competitive landscape of the global connected cars market is characterized by intense rivalry among key players striving to capitalize on the surging demand for connected technologies in the automotive sector. Established automotive manufacturers vie for market share by investing in research and development (R&D), forging strategic partnerships, and enhancing their connectivity ecosystems. Moreover, telecommunications companies play a pivotal role in providing the necessary infrastructure for robust connectivity. The market also sees the emergence of startups specializing in specific connected car solutions, fostering innovation and agility. As the industry evolves, competition intensifies not only in delivering cutting-edge connectivity features but also in addressing cybersecurity concerns, ensuring regulatory compliance, and meeting diverse consumer demands for safety, entertainment, and convenience services.

The market research report has provided a comprehensive analysis of the competitive landscape. Detailed profiles of all major companies have also been provided. Some of the key players in the market include:

• AT&T Inc.
• Audi AG (Volkswagen AG)
• Bayerische Motoren Werke AG
• Continental AG
• Ford Motor Company
• Mercedes-Benz Group AG
• Qualcomm Incorporated
• Robert Bosch GmbH
• Samsung Electronics Co. Ltd.
• Sierra Wireless
• Tesla Inc.
• TomTom N.V.
• Valeo
• Verizon Communications Inc.
• Vodafone Group Plc
   

(Please note that this is only a partial list of the key players, and the complete list is provided in the report.)

Latest News:

• In January 2024, Samsung Electronics announced its collaboration with Tesla that will connect SmartThings Energy to Tesla products such as Powerwall home batteries, Solar Inverter, Wall Connector charging solutions, and electric vehicles (EVs).
• In September 2023, Continental AG partnered with Google Cloud to create an intuitive user experience for drivers by equipping their cars with Google Cloud’s data and generative AI technologies.
• In February 2023, Qualcomm Technologies launched Snapdragon® Auto 5G Modem-RF Gen 2, featuring high-performance processing power and up to 200 MHz of network capacity to support reliable, low-latency connectivity for safe, intelligent, and immersive riding experiences.

Connected Car Market Report Scope:

Key Benefits for Stakeholders:

• IMARC’s industry report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the connected car market from 2019-2033.
• The research report provides the latest information on the market drivers, challenges, and opportunities in the global connected car market.
• The study maps the leading, as well as the fastest-growing, regional markets. It further enables stakeholders to identify the key country-level markets within each region.
• Porter's five forces analysis assists stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the connected car industry and its attractiveness.
• The competitive landscape allows stakeholders to understand their competitive environment and provides insight into the current positions of key players in the market.