Automotive Software Market

Global Automotive Software Market to Grow at a CAGR of 16.30%, during Forecast Period

Published | 22 September 2022

Global Automotive Software Market is flourishing owing to the compliance with fuel efficiency rules, comfort and convenience needs, and the need to minimize vehicle downtime.

A recent study conducted by the strategic consulting and market research firm, BlueWeave Consulting, revealed that the Global Automotive Software Market was worth USD 20.57 billion in the year 2021. The market is projected to grow at a CAGR of 16.30%, earning revenues of around USD 58.42 billion by the end of 2028. The Global Automotive Software Market is booming because of the expanding automotive industry. Moreover, the usage of open-source platforms and the standardization of product offerings has decreased the cost of application and firmware development, growing the automotive software business as a whole. Consumers and OEMs have been urged to gradually increase their focus on car infotainment systems as a result of recent technological breakthroughs in the industry. These manufacturers are now competing based on the software or operating system that is employed in these systems. The adoption of ADAS features in vehicles, the quick uptake of connected vehicles, and government partnerships to build infrastructure for connected vehicles have all positively anticipated propelling the growth of the market. At present, vehicles support operating system platforms such as Windows CE, Android, Apple OS, QNX, and Linux-based OS. However, the market growth is being constrained by issues including a shortage of experienced workers, automotive engineers, expertise, and standards and protocols, which may act as a huge restraining factor for the market growth.

Rising Adoption of Connected Cars

For the stakeholders in the ecosystem, the rising number of connected cars has opened up new revenue-generating potential. To take advantage of the financial opportunity, numerous non-automotive businesses have entered the race of linked automobiles and autonomous driving. The modern automobile is not a hardware-based moving mechanism. They currently make up around 40% of all electronic information, and over 60% is predicted for them in the upcoming decades. The majority of electronic content for cutting-edge automotive applications like ADAS, telematics, engine management systems, and others will be dominated by domain controllers, consolidated ECUs, HMI, and AI. These applications need a lot of lines of code to be coded properly for them to work. The complexity of these applications rises as vehicles become more technologically advanced. As a result, systems require more coding, which raises the need for embedded software. As a result, the market for automotive software is rising along with the number of connected vehicles. This results in offering lucrative opportunities for the Global Automotive Software Market during the forecast period (2022-2028).


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5G and AI Have the Potential to Create Global Automotive Software Market Opportunities

As predictive capabilities become more prevalent in vehicles and the driving experience becomes more personalized, AI and 5G will play a crucial part in the future of the automotive industry. More automakers are employing data-driven algorithms to automate vehicle settings such as the infotainment system and application preferences. Furthermore, 5G is better suited for vital communications for safer driving, increased vehicle-to-vehicle (V2V) connectivity, and connected mobility solutions. As a result, the wide range of 5G and AI applications in future mobility is expected to provide profitable growth prospects for the automotive software industry shortly.

Challenge: High Degree of Vehicle Architectural Complexity

Product variation, function integration, individualization, and novel technologies come from the competitive market environment and strict CO2 emission reduction rules that are driving forces in the automotive industry. The organizational, technological, and procedural dependence on extremely complex development environments increases as a result of these tactics. The repercussions of complexity occasionally manifest as waves of fault reports, very high design efforts, and an upsurge in warranty costs. Complexity is necessary to provide a system's functions and characteristics, but it also makes the system challenging to comprehend. Millions of elements in the code, including local variables, operators, global variables, preprocessors, conditional statements, pointers, threads, functions, and so on, generate complex units and abstraction layers on a vast scale.

Segmental Coverage

Global Automotive Software Market - By Vehicle Type

Based on vehicle type, the Global Automotive Software Market is segmented into Passenger Car, LCV/MCV, and HCV. During the projected period, the automotive software market for passenger cars is anticipated to be the largest. This is due to the higher penetration of software services in personal vehicles compared to commercial vehicles. Strong demand for extremely cutting-edge applications like ADAS and linked services are the main reason for increasing the need for automotive software in passenger automobiles in industrialized countries. The main company adopted the strategy as a result of the rising demand for advanced applications in the automobile industry. For instance, Savari Inc. (US), a developer of vehicle-to-everything communication technology for 5G Edge and automotive gadgets, was bought by Harman International (US) in February 2021.

Impact of COVID-19 on Global Automotive Software Market

The COVID-19 issue has had a cascading effect on the global car market since it began in China, where sales plunged by 71% in February 2020. By April 2020, sales had dropped 47% in the United States and 80% in Europe. This decreased market demand as a result of a fall in demand from major vehicle makers. However, automakers have witnessed a steady uptick in output levels from the third quarter of 2020 to the second quarter of 2021, as the supply chain began to regain some energy. Furthermore, the crisis has accelerated the already underway digitization process, resulting in rapid transformation throughout the mobility value chain. While non-manufacturing, production lines had been shut down for extended periods due to pandemic-related constraints. While production lines were forced to close for extended periods owing to pandemic-related constraints, non-manufacturing operations were nevertheless managed by personnel using secure connections via work-from-home or remote work models.

Competitive Landscape

The leading market players in the Global Automotive Software Market are Aimotive, Airbiquity, Apple, Aptiv plc, Autonet Mobile, Blackberry, Elektrobit, Google, Green Hills Software, Intel Corporation, Kpit Technologies, Luxoft, Microsoft Corporation, Nvidia, Nxp Semiconductor, Panasonic, Renesas Electronics, Rightware, Robert Bosch GmbH, Saferide Technologies Ltd, Siemens Industry Software Inc., Sigma Software Group, Vector Informatik, Wind River System, and other prominent players.


The Global Automotive Software Market is highly fragmented with the presence of several manufacturing companies in the country. The market leaders retain their supremacy by spending on research and development, incorporating cutting-edge technology into their goods, and releasing upgraded items for customers. Various tactics, including strategic alliances, agreements, mergers, and partnerships, are used.


Don’t miss the business opportunity in the Global Automotive Software Market. Consult our analysts to gain crucial insights and facilitate your business growth.


The in-depth analysis of the report provides information about growth potential, upcoming trends, and statistics of the Global Automotive Software Market. It also highlights the factors driving forecasts of total market size. The report promises to provide recent technology trends in the Global Automotive Software Market and industry insights to help decision-makers make sound strategic decisions. Furthermore, the report also analyzes the growth drivers, challenges, and competitive dynamics of the market.

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