Automotive Electronics Market size is poised to reach USD 550 Billion by the end of 2033, growing at a CAGR of 8% during the forecast period, i.e., 2023-2033. In the year 2022, the industry size of automotive electronics was USD 275 Billion. The growth of the market can be attributed to the increasing demand for automotive electronics systems, which are effectively contributing to enhanced vehicle safety worldwide. For instance, it is projected that electronic systems are anticipated to account for almost 50% of the total price of a new car by 2030. Besides this, the significantly rising adoption of electric vehicles and hybrid electric vehicles, along with an upsurge in the demand for infotainment features, is also propelling the growth of the global automotive electronics over the projected timeframe.
In addition to these, factors that are believed to fuel the market growth of automotive electronics include the rise in the demand for autonomous vehicles, proliferating automotive production, and the surging integration of highly advanced safety systems such as emergency call systems, automatic emergency braking, and lane departure warning systems to lower the road crashes. Electronic parts that are used in automobiles are utilized to be controlled digitally for most of the car’s operations, along with an embedded system that is used in the telematics, music system, radio, anti-lock braking system, parking ability, and safety airbags. With the recent advancements in automotive electronic control units as well as surging investment in research and development, the demand for automotive electronics is on the rise among automobile users, which in turn, is expected to create massive revenue generation opportunities for the key players operating in the global automotive electronics market during the forecast period. For instance, the European Union (EU) invested of more than USD 58 billion in automotive research and development, in 2020. Additionally, the growing replacement of mechanical devices by electrical devices is also predicted to present the potential for market expansion over the projected period.
Growth Drivers
Challenges
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Base Year |
2022 |
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Forecast Year |
2023-2033 |
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CAGR |
8% |
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Base Year Market Size (2022) |
USD 275 Billion |
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Forecast Year Market Size (2033) |
USD 550 Billion |
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Regional Scope |
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Vehicle Type (Light Commercial Vehicle, Heavy Commercial Vehicle, Passenger Car)
The global automotive electronics market is segmented and analyzed for demand and supply by vehicle type into light commercial vehicle, heavy commercial vehicle, and passenger car. Out of the three types of segments, the passenger car segment is anticipated to garner the largest revenue by the end of 2033. The growth of the segment can be attributed to the growing demand for cars along with the surge in the sale of passenger cars worldwide. For instance, it was found that more than 55 million units of passenger cars were sold globally in the year 2021, showing an increase of nearly 4% from 2020. Moreover, the massive surge in the production of passenger cars is another key factor that is anticipated to accelerate the market growth of automotive electronics throughout the forecast period.
Application {Body Electronics, Advanced Driver Assistance System (ADAS), Safety Systems, Infotainment, Powertrain Electronics}
The global automotive electronics market is also segmented and analyzed for demand and supply by application into body electronics, advanced driver assistance system (ADAS), safety systems, infotainment, powertrain electronics, and others. Amongst these segments, the powertrain electronics segment is expected to garner a significant share over the forecast period. Powertrain electronics are key components such as the engine, gearbox, and transmission that help the vehicle move by supplying and managing electric power. Therefore, automotive manufacturers are spending huge amounts on research and development of more efficient automotive powertrain electronics. Besides this, simultaneous electrification in the automotive industry is also boosting the expansion of the power electronics segment. This, as a result, is projected to create several opportunities for the growth of the segment in the coming years.
Our in-depth analysis of the global market includes the following segments:
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By Component |
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By Application |
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By Vehicle Type |
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By Distribution Channel |
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Asia Pacific Market Forecast
The Asia Pacific automotive electronics market, amongst the market in all the other regions, is projected to hold the largest market share by the end of 2033. The growth of the market can be attributed majorly to the escalating sale of vehicles along with the rising production of vehicles. For instance, in India, the auto industry produced around 22,933,000 vehicles from April 2021 to March 2022. As for burgeoning electronic component manufacturing operations, nations such as Taiwan, Malaysia, South Korea, and Thailand have considerably contributed to the market expansion in the region. Further, the presence of a strong automobile network in the region, and the rapidly growing penetration of vehicles, are also anticipated to contribute to the market growth in the region. In addition, the surge in the proportion of technologically advanced manufacturing units is also anticipated to boost the market growth during the forecast period.
Europe Market Forecast
Furthermore, the Europe automotive electronics market is also estimated to display notable market growth by the end of 2033. The growth of the market can be attributed to the existence of major automotive manufacturers such as Skoda, BMW, Volkswagen, and so on in the region. In addition to this, the growing awareness regarding the safety and security features in a vehicle, and the massively rising count of prominent automobile assembly and engine production factories are some further significant factors that are projected to accelerate the automotive electronics market in the region over the projected time frame. For instance, in Europe, there are approximately 306 automotive manufacturing and engine manufacturing plants that manufacture passenger cars, light commercial vehicles, heavy-duty vehicles, buses, and engines.
VALEO signed an agreement with the Atomic Energy Commission (CEA) and the French Alternative Energies to conduct advanced research in power electronics to prepare for upcoming electric mobility.
DENSO Corporation is ready to provide electrification components to Toyota and Subaru’s all-new, all-electric bZ4X and SOLTERRA.
Author Credits: Harshita Srivastava, Saima Khursheed
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