Automotive 5G Market size (2024-2030)

As per our research report, the Automotive 5G Market size is estimated to be growing at a CAGR of 25% from 2024 to 2030.

The Automotive 5G sector is experiencing rapid growth, propelled by the rising need for connected and self-driving vehicles. The demand for instantaneous communication between vehicles and infrastructure for enhanced safety and operational efficiency is driving this expansion. This rapid advancement highlights the transformative influence of 5G technology, which is profoundly reshaping the driving experience.

The future of transportation relies heavily on real-time communication, with 5G serving as the crucial technology enabling this for connected and autonomous vehicles (CAVs). Unlike previous cellular network generations, 5G offers ultra-low latency, which ensures minimal data transmission delays. This capability allows CAVs to engage in nearly instantaneous exchanges with each other, traffic infrastructure, and even pedestrians. Such real-time communication is essential for safety features, such as collision avoidance. For instance, a vehicle can receive immediate alerts about sudden braking from a car ahead, thanks to 5G’s low latency.

The Automotive 5G sector presents a wealth of opportunities set to transform driving. Central to this is the enhancement of safety features in connected and autonomous vehicles. 5G’s ultra-low latency facilitates real-time interaction between vehicles and infrastructure, supporting functions like collision avoidance and prompt automated driving decisions with remarkable precision. Consider the ability of vehicles to receive immediate notifications about sudden braking or hazardous road conditions—5G technology makes this feasible. Moreover, 5G expands possibilities for in-car entertainment, offering seamless high-definition video streaming and augmented reality navigation that overlays virtual guidance on the windshield. Over-the-air software updates can also be completed rapidly, removing the need for dealership visits.

The COVID-19 pandemic initially disrupted the Automotive 5G market, impeding its growth. Lockdowns led to factory closures, which delayed the production of 5G-enabled vehicles and hindered hardware development. Supply chain issues further compounded these challenges. Nonetheless, the pandemic inadvertently accelerated demand for features enabled by 5G, such as enhanced in-car entertainment and remote software updates. The heightened need for efficient transportation systems also prompted continued government investment in 5G infrastructure, particularly for smart city projects.

Establishing a robust 5G network for the future of transportation requires a substantial financial investment. The extensive infrastructure needed involves significant costs, including the installation of cell towers and small cells across broad areas to ensure comprehensive coverage. Additionally, the installation of fiber optic cables—vital for high-speed data

transmission—incurs further expenses due to the need for extensive trenching or cabling. The process is further complicated by the need to navigate regulatory requirements, which can be time-consuming and costly. These regulatory challenges can lead to delays and increased costs, complicating the deployment of a comprehensive 5G network.

KEY MARKET INSIGHTS:

• Based on the Type, In the Automotive 5G market, hardware plays a predominant role. This encompasses physical components such as onboard units (OBUs) in vehicles and base stations that constitute the foundation of the 5G network. The predominance of hardware is understandable, given that the technology is still developing; establishing the physical infrastructure necessary for 5G connectivity in vehicles is a crucial initial step. Nonetheless, software is poised for substantial growth. As the market advances and applications become increasingly sophisticated, software that manages communication protocols, processes in-vehicle data, and optimizes network traffic will be crucial for fully unlocking the potential of 5G in connected and autonomous vehicles. In the future, a seamless integration of hardware and software is anticipated, fostering a robust ecosystem that drives innovation and advances the safety and connectivity of the transportation landscape.
• Based on the Application, While Connected Car Services provide appealing features such as in-car entertainment and remote diagnostics, Vehicle-to-Everything (V2X) currently dominates the Automotive 5G market. V2X is centered on the essential capability of 5G for connected and autonomous vehicles: real-time communication with their surrounding environment. This encompasses interactions between vehicles (such as collision avoidance), infrastructure (like smart traffic signals), and even pedestrians (improving overall safety). V2X establishes the groundwork for a future characterized by safer, more efficient, and automated transportation. Although Connected Car Services will certainly enrich the driving experience, V2X is at the forefront of a transformative shift in how transportation is experienced.
• Based on the region, North America currently leads the Automotive 5G market, thanks to its established automotive industry and robust technological infrastructure. However, the Asia Pacific region is anticipated to experience the most rapid growth. This surge is driven by the expanding automotive sector in countries such as China and India, coupled with substantial government investments in 5G network development. As these regions enhance their 5G infrastructure and automotive manufacturers incorporate this technology into their vehicles, Asia Pacific is set to emerge as the leading player in the future of the Automotive 5G market.
• Companies playing a leading role in the Automotive 5G Market profiled in this report are Audi AG, BMW Group, Robert Bosch GmbH, Mercedes-Benz and Huawei Technologies Co.