Automotive Embedded System Market By Type (Software, Hardware) By Application (Powertrain & Chassis Control, Body Electronics, Multimedia & Integrated Systems/Services) By Component (Memory Devices, Microcontrollers, Sensor & Drivers) - Growth, Future Prospects & Competitive Analysis, 2016 - 2028

About this report

The global automotive embedded system market report explores the critical analysis of the automotive embedded system industry using key parameters. The report consists of investment strategies, the need for investments in the automotive embedded system industry, and the multiple benefits for investors. Importantly, this report sets out major changes in the global technical regulations for the automotive embedded system industry and how economic and non-economic barriers are helping the automotive embedded system market growth. Moreover, the report analyses the global, regional, and country-level historic and forecasted market size. The report also provides a comprehensive analysis of key investment propositions, demand and supply gap, competitors positioning, STAR analysis, SRC analysis, and Tornado analysis. Key technological developments and other analyses include Porter's five forces analysis, PESTEL analysis, value chain analysis, etc.

Key Highlights of the report

How are the major segments performing in the Automotive Embedded System Market?

• The sensor & drivers segment led the market in terms of type in 2021 and is expected to continue throughout the projection period. The growing demand for advanced automobile sensors to save energy, comply with low emission and safety standards, and boost vehicle efficiency by monitoring the vehicle's systems with various sensors is driving the segment's growth.
• The software type segment held the largest global market share in 2021, owing to rising demand for human-machine interaction (HMI) in automotive and increased software content in highly developed vehicle applications. Some widely used software applications that demand integrating an embedded system include tire pressure monitoring systems, anti-lock braking systems, airbags, telematics, satellite radio, and emission control.
• The multimedia & integrated systems/services segment dominated the global market in the application in 2021 and is expected to continue over the forecast period. Automotive multimedia and integrated systems (MIDS) are a set of software and hardware that provide video or audio entertainment in a vehicle. Automobile navigation systems, USB and Bluetooth connectivity, video players, in-car internet, and Wi-Fi are among the primary in-car entertainment systems compatible with radios, cassettes, or CD players.
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Which region dominated the automotive embedded system market?

Asia Pacific dominated the global automotive embedded system market in 2021 and is expected to maintain its dominance throughout the forecast period. The region is seeing an increase in digitalization and the Internet of Cars, allowing greater connectivity via technology-enabled automobiles. The increasing adoption of integrated systems in China, Japan, and India can be attributed to the growing need for vehicle security and environmentally friendly technologies. Embedded systems, once a crucial component of luxury cars, are also becoming more common in affordable cars. The popularity of smartphones and the ongoing accessibility of high-speed internet has increased demand for infotainment systems. Manufacturers have begun to incorporate modern infotainment systems into small and medium-sized vehicles. Adopting infotainment systems has always been substantial in the premium car segment. Market players in the highly competitive shared mobility industry are assembling automated infotainment systems in their vehicles to meet the needs of their customers in terms of entertainment and convenience.

How is US Market Performing in the automotive embedded system market?

The United States led the North American automotive embedded system market and is expected to continue over the forecast period owing to increasing demand for commercial vehicles for travel due to the country's increased consumer spending. According to the International Organization of Motor Vehicle Manufacturers, total commercial vehicle production and sales in the United States in 2019 were around 12404698 units. This has increased demand for embedded hardware and software systems, expanding the automotive embedded systems market. The improved integration of the embedded systems market among research facilities, suppliers, and automakers has enabled the country to deliver faster, resulting in a dominant market share in the North American automotive embedded system market.

What is the competitive environment of the automotive embedded system market?

The global automotive embedded system market is extremely competitive, with numerous international and domestic markets. Product diversification, market revenue generation, and opportunities contribute to increased market competition. Key companies are expanding their market penetration through acquisitions, mergers, collaborations, and licensing. For instance, HARMAN and NXP Semiconductor extended their 15-year collaboration for connected vehicles on June 21, 2017. Embedded automotive systems, such as amplifiers, digital signal processors, tuners, and applications processors, will benefit from this technology partnership's support for developing connected in-car technology. Likewise, in June 2022, Real-time Robotics announced a collaboration with Mitsubishi Electric Automation Inc to advance industrial robot programming and control with innovative motion control and collision avoidance operating software used in automotive. On the other hand, Johnson Electric introduced an all-in-one e-axle solutions pack for electric vehicles in January 2022. The package covers everything from safety parking to four-wheel drive mode shifting to electric drive placement detection.

Executive Summary

What technical developments are being developed in the automotive embedded system market?

Increasing demand for technologically advanced systems is expected to drive growth in the market for automotive embedded systems. Automotive embedded system market participants integrate cutting-edge technologies and features into new product developments and innovations to stay competitive. For instance, Tessolve Semiconductor (Hero Electronix) and DynamoEdge developed a sensor-to-cloud architecture using network APIs in February 2022 to improve user experience and power near real-time intelligence in vehicles. Similarly, DENSO Corporation and Qualcomm Technologies Inc, a Qualcomm Incorporated subsidiary, announced a partnership on next-generation cockpit technologies in January 2021. DENSO plans to improve the usability of embedded cockpit systems and in-vehicle infotainment products while also developing in-vehicle solution latest technology for these systems. Moreover, Harman Companies opened a facility focused on automotive software system development for interconnected technologies in Poland's automotive, enterprise, and consumer markets on November 8, 2018.

Which are the key investments by the automotive embedded system market players?

Manufacturers of automotive embedded systems intend to establish the collaborative project and research facilities, invest in industrial production, and launch new products and services. Increased investment and development of advanced technology software, AI and IoT-based microelectronic systems for the automotive embedded systems market. For instance, Robert Bosch, a German technology company, allocated more than USD 400 million in October 2021 for production-related investments in microchips to help with a global shortage. Similarly, Mercedes-Benz planned to invest USD 47 billion between 2022 and 2030 in electric vehicle battery development to be ready for an all-electric automobile sector by that year.

Some major players in the automotive embedded system market are NXP Semiconductors, Denso Corporation, Continental AG, Harman International, Garmin Ltd, Mitsubishi Electric Corporation, Infineon Technologies, Robert Bosch GmbH, Panasonic Corporation, and System Controls Technology Solutions Pvt. Ltd.

What are the Major Driving Factors for the Automotive Embedded System Market?

Rising global demand for electric vehicles and increased adoption of embedded systems in hybrid and electric vehicles due to their ability to lower pollution and enhance efficiency are key drivers of the global automotive embedded systems market. Growing customer focus on automobile safety features, rising automation in the automotive sector, and government efforts to reduce emissions and improve fuel efficiency are supposed to propel the automotive embedded system market during the forecast period. Moreover, the growing need for vehicle sensors and engineering systems and the rising popularity of connected cars will likely fuel market expansion over the projected period.

What are the Major Risks for the Automotive Embedded System Market?

These electronic devices need sophisticated software algorithms, which indirectly leads to high battery power consumption and limits market expansion. On the other hand, automotive embedded systems rely on low-level electronic components with a short lifespan and high-power consumption, which are also anticipated to impede the global market growth.

Which is the key type in the automotive embedded system market?

The software type segment will lead the global market during the forecast period. Vehicles with embedded software systems help predict maintenance requirements and avoid collisions. In addition, the development of connected cars is forcing automobile manufacturers to enhance the software they develop for embedded cars, bridging the gap between mobility and the automotive ecosystem and enhancing vehicle performance based on outside-and inside-the-car data. Software-based systems are increasingly in charge of the wipers, doors, lights, seats, windows, and mirrors on vehicles. They are not a critical component of the system in terms of safety and are not generally subject to strict performance limits. Improving target functionality and tailoring core software for various vehicles is a major driver of the automotive embedded system market's expansion.

How is the automotive embedded system market performing in regions?

In 2021, Asia Pacific held a dominant position in the automotive embedded system market due to rising vehicle production across several regional nations, improving socioeconomic conditions, and increasing demand for electric vehicles, particularly in China and Japan. As per the Organization Internationale des Constructeurs d'Automobiles (OICA), total vehicle sales in China in 2018 were 28,080,577 units, accounting for 29.5% of global sales. In addition, OICA statistics show that China, with 29,015,434 manufactured vehicles in 2018, has the highest vehicle production rate, followed by Japan, South Korea, and India. This is propelling the global automotive embedded systems market forward.

North America is anticipated to hold the second-largest revenue share of the global automotive embedded system market owing to the rapid expansion of the manufacturing and automotive industries in developed nations like the U.S. and Canada, as well as the introduction of advanced strategies & technologies by leading players. In North America, automakers directly submit the subsystem specifications to a specialized research facility, which then competes to develop a solution for these automakers. The responsibility of the selected suppliers is to actualize these subsystems, including the hardware and software components. Governments in North America, as opposed to other regions, facilitate the robust integration of the entire process. As a result, North America has a bright potential in the automotive embedded system market.

What is the regulatory landscape for the automotive embedded system market?

North America, Asia Pacific, and Europe are predicted to experience rapid growth in the automotive embedded systems market due to the rapidly increasing demand for electric vehicles, increased government or manufacturer investments in vehicle electrification, stringent safety regulations, and stringent fuel and emission economy standards in these regions. For example, the Indian government intends to transform the country entirely to electric vehicles by 2030. Moreover, the largest American automakers backed a government initiative to lower greenhouse gas emissions by 2030, which called for half of all new vehicles manufactured to be electric.

What is the Market Size of the Automotive Embedded System regarding value?

The global automotive embedded system market is anticipated to grow at a substantial CAGR of 6.4% in the upcoming years. The global automotive embedded system industry is estimated to be worth USD 4.1 billion in 2021 and is expected to be worth USD 5.94 billion by 2028.

What are the major players planning for the future of the automotive embedded system market?

The increasing trend of autonomous vehicles is one of the most important opportunities for manufacturers in the automotive embedded system industry. Many automobile manufacturers, technology companies, telecommunications companies, research institutions, software start-ups, insurance firms, and others have announced plans to collaborate to enhance autonomous vehicle growth and future development. Major automotive embedded system market companies are developing software solutions to provide comprehensive system assistance. For instance, Zhuhai Enpower Electric Co. Ltd revealed in June 2021 that it is the first to integrate Infineon Technologies AG's recent 750 V automotive-grade IGBTs. The discrete IGBT EDT2 devices allow for cost reductions and performance increases in primary inverter applications. Electric vehicle DC link discharge switches help achieve future system integration objectives.

Segmentation of Global Automotive Embedded System Market -

Global Automotive Embedded System Market – By Type

• Software
• Hardware
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Global Automotive Embedded System Market – By Application

• Powertrain & Chassis Control
• Body Electronics
• Multimedia & Integrated Systems/Services
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Global Automotive Embedded System Market – By Component

• Memory Devices
• Microcontrollers
• Sensor & Drivers
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Global Automotive Embedded System Market – By Region

• North America
  • US
  • Canada
• Europe
  • Germany
  • France
  • UK.
  • Italy
  • Spain
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • South-east Asia
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East & Africa
  • GCC Countries
  • South Africa
  • Rest of Middle East and Africa