Artificial
Intelligence in Automotive Market is Set to Witness Rapid Growth Owing to
Increasing Autonomous Vehicle Technologies

Artificial
intelligence (AI) in the automotive sector has shown great promise in terms of
improving safety, enhancing driving experience, and enabling new mobility
solutions. AI technologies allow vehicles to recognize objects, perceive the
environment, and make decisions. Some common AI applications in automobiles
include advanced driver assistance systems (ADAS), autonomous navigation,
predictive maintenance, and in-vehicle experience personalization.

The global artificial intelligence in the automotive
market is estimated to be valued at US$ 5.5 billion in 2024 and is expected to
exhibit a CAGR of 12% over the period 2024-2032.



Key Takeaways

Key players operating in the artificial intelligence in automotive market are
Tesla, Intel, NVIDIA, IBM, Microsoft, Alphabet, and Toyota. These players are
focusing on partnerships, collaborations, acquisitions, and developing new
autonomous driving technologies to gain a competitive advantage in the market.

The increasing Global
Artificial Intelligence in Automotive Market Demand for enhanced
passenger experience and convenience features is creating major opportunities
for automakers to integrate advanced AI technologies in vehicles. Chatbots,
virtual assistants, and smart cockpits are some areas that are expected to
witness significant innovations.

Automakers are expanding their operations and partnerships globally to tap the
rising demand for self-driving cars in countries such as China, Germany, UK,
and Japan. Regional collaborations and support from governments will play a
vital role in the adoption of autonomous vehicles across major markets.



Market Drivers

Growing demand for advanced driver-assistance systems: ADAS technologies such
as adaptive cruise control, park assist, and lane departure warning are seeing
increased adoption. AI is a core enabler of these semi-autonomous driving
features.

Developments in deep learning and machine vision: Advancements in computer
vision, neural networks, and sensor fusion are allowing vehicles to more
accurately map their surroundings and respond in real-time. This is fueling
innovations in autonomous driving.



Market Restraints

Safety challenges of autonomous vehicles: Fully self-driving cars still need to
overcome technological bottlenecks related to detecting anomalies, making
decisions at intersections, and responding to unpredictable situations. This risks
delays in commercialization.

High price points of advanced systems: Integrating sophisticated AI hardware
and software comes at a significant cost. This acts as a deterrent for mass
adoption, especially in price-sensitive markets. Standardization of platforms
could help address this obstacle over time.

Segment Analysis

The artificial intelligence in automotive market can
be segmented into hardware, software, and services. The hardware segment, which
includes processors, sensors, and memory devices, accounts for the largest
share of over 40% of the market. This is because a significant amount of
capital is required to develop hardware such as processors, sensors and other
devices that can power AI capabilities in autonomous and semi-autonomous vehicles.
The software segment is expected to grow at the highest CAGR during the
forecast period due to growing demand for deep learning and machine learning
algorithms that help vehicles sense the environment and drive autonomously. The
services segment is also growing due to need for regular upgrades, repairs, and
maintenance of AI systems in connected vehicles.



Global Analysis

On the basis of region, North America dominates the Artificial
Intelligence In Automotive Market Regional Analysis with over 30%
share. This is due to presence of leading automakers and tech companies
developing autonomous vehicles in U.S. and Canada. Europe is another major
region due presence of established automotive industry and emphasis on driver
assistance and ADAS systems. However, Asia Pacific region is projected to grow
at the fastest pace during the forecast period led by China. This is because of
increasing sales of vehicles and government initiatives to develop smart
transportation through investment and partnerships in AI technologies. Also,
growing popularity of ride-hailing and shared mobility services in APAC
countries, especially India and Southeast Asia, is expected to drive the demand
for AI in automotive sector for enhanced passengers' experience.

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Intelligence In Automotive Market

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Alice Mutum is a seasoned senior content editor at Coherent
Market Insights, leveraging extensive expertise gained from her previous role
as a content writer. With seven years in content development, Alice masterfully
employs SEO best practices and cutting-edge digital marketing strategies to
craft high-ranking, impactful content. As an editor, she meticulously ensures
flawless grammar and punctuation, precise data accuracy, and perfect alignment
with audience needs in every research report. Alice's dedication to excellence
and her strategic approach to content make her an invaluable asset in the world
of market insights.

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