Autonomous Vehicle Testing Services Market Size (2023 - 2030)

As per our research report, the global Autonomous Vehicle Testing Services market is projected to grow at a CAGR of 38% from 2023 - 2030.

Industry Overview:

A vehicle that can function on its own, commonly referred to as an autonomous vehicle, is a driverless vehicle. It can do necessary tasks by detecting and reacting to outside factors and its environment using sophisticated internal programming. Self-driving cars, commonly referred to as autonomous vehicles, have significantly changed automation and communication. To assist and automate driving tasks, the internet, computers, smartphones, and other cutting-edge technologies are being integrated into vehicles. The autonomous vehicle is made up of many sensors, including RADAR and LiDAR systems, that operate in tandem to perform tasks automatically without the assistance of drivers. These sensors aid in navigation by carrying out situational analysis, motion planning, and trajectory control. The development of adaptive algorithms, high-definition mapping, sensor processing, and improved infrastructure, among other technological advancements, is motivating several businesses to increase their manufacturing of autonomous vehicles.

Tests for autonomous vehicles include full vehicle homologation, Bluetooth compatibility, cellular regulatory and carrier approvals, device durability, FCC compliance, and short-range wireless communications for a vehicle to infrastructure (V2I) and vehicle to vehicle (V2V) communication, among other aspects of the vehicles. Governments in several nations, including the U.S., Germany, China, and Japan, have adopted autonomous vehicles due to growing safety concerns and breakthroughs in automobile technology. To introduce autonomous vehicles in their nation, numerous governmental organizations are undertaking numerous initiatives.

The rise in demand for automated and improved automobiles as well as the amount of traffic accidents is responsible for the market expansion. Additionally, the need for autonomous vehicle testing services is increasing as a result of numerous governments implementing strict regulatory regulations in the automotive sector. The strict regulatory regulations for testing and certification by the regulatory authorities, such as the requirement for periodic technical inspections (PTI) of both conventional and autonomous vehicles, are creating profitable growth prospects for the autonomous vehicle testing industry. Additionally, because TIC certification raises the bar of the production process, the majority of nations have made it mandatory for car manufacturers to obtain this certification before exporting automotive goods. Testing of driverless vehicles is becoming more necessary as a result.

COVID-19 pandemic impact on Autonomous Vehicle Testing Services Market

Companies that are developing automatic driving system (ADS) technology have recently invested considerably to test autonomous vehicles in real-world settings to assure their dependability and safety. The Covid-19 pandemic, which started spreading unestimatedly in March 2020, has however served to suspend, change, or delay the achievement of these new product development test targets. Due to the growing variety of software and communication interfaces being used, consumers and regulatory bodies anticipate that as highly automated driving and autonomous vehicles advance, they will undergo extensive testing to ensure their general safety as well as an assessment of their cyber security and data privacy. To attract a sizable section of the consumer base, the sector must have faith in environmental and driving safety.

MARKET DRIVERS:

The market is being driven by a wide range of opportunities for luxury cars (Level 1 and Level 2) in emerging economies

The market for luxury automobiles is expanding, and automakers like Volvo, BMW, Audi, and Mercedes-Benz are among those producing level 1 and level 2 autonomous luxury vehicles. Unprecedented growth in the automotive industry has been seen in recent years in developing nations like China, India, Vietnam, Malaysia, and Indonesia, which are also becoming important manufacturing centers for major international automotive manufacturers. Leading international automotive OEMs are expanding their businesses through product launches, acquisitions, and collaborations in new and emerging regions to effectively capitalize on consumers' growing demand for automobiles. To close the supply-demand gap, top car OEMs are also growing their manufacturing capacity and extending their geographic reach into emerging nations.

The market for automotive vehicle testing services is expanding as a result of the growing number of advantages unmanned vehicles have over conventional cars.

The market for automotive vehicles is expanding as a result of the growing number of advantages that autonomous vehicles offer including decreased risk of traffic accidents, improved safety and security, the elimination of driver wages, secured mobility for people with disabilities and non-drivers, and increased comfort and flexibility provided by seamless operational systems. Gaining the trust, confidence, and approval of passengers is essential as autonomous driving technology develops to encourage the usage of these technologies on public highways with rigorous self-driving car safety assessments. By defining new safety assessment compliance criteria for automated and connected technology, autonomous vehicle testing services address current challenges By adopting an integrated scenario-based approach to assess safety and security in a real-world environment, autonomous vehicle testing services address current challenges by defining new safety assessment compliance criteria for automated and connected technology. This approach allows reproducible results required for type approval and confirmation of product safety and saves time and money with an effective hybrid testing approach that combines virtual and field testing methods.

Government funding, a favorable regulatory environment, and investments in digital infrastructure are  driving the market demand

The market for autonomous vehicles is being positively influenced by government financing, a supportive regulatory environment, and investments in digital infrastructure during the anticipated period. Additionally, it enables both non-drivers and those with disabilities to move about independently. Their productivity is increased by the high level of comfort and flexibility they provide for sleeping, reading, or even working while flying. Autonomous vehicles have also been launched as a result of increased technology development and industry diversification. Following the emergence of electric and hybrid cars, autonomous vehicles are a revolutionary technology in the automotive sector.

MARKET RESTRAINTS:

The lack of necessary infrastructure in developing nations could impede market expansion

For optimal operation, autonomous or self-driving vehicles need the bare minimum of infrastructure, including well-marked lanes, GPS connectivity, and well-maintained roadways. Communications between V2V and V2X also need a strong connectivity infrastructure. Semi-autonomous and driverless vehicles on highways depend on data such as object recognition, lane change, traffic, vehicle distances from other vehicles, and connectivity and navigation services. However, due to poor network connectivity on highways, vehicles are not connected to cloud data or each other. When compared to industrialized economies, the development of IT infrastructure on highways is slower in rising nations like Mexico, Brazil, and India. Urban and semi-urban areas are the only places where 3G and 4G-LTE communication networks are available, which are necessary for connectivity. In semi-urban and rural locations, where there are many third-party logistics businesses, connectivity problems still exist. Government assistance is also required for the deployment of autonomous and self-driving automobiles in these developing nations. Therefore, in emerging nations, the development of autonomous or self-driving cars is severely constrained by both a lack of government rules and a lack of information technology communication infrastructure. The development of the market for autonomous / self-driving automobile vehicle testing services in these nations is constrained by a lack of infrastructure outside of urban areas, economic considerations, and inadequate driving instruction or discipline.

This research report on the Autonomous Vehicle Testing Services Market has been segmented based on test type, vehicle type, vehicle autonomy, and region.

Autonomous Vehicle Testing Services Market – By  Test Type

• Software Testing

• Simulation Testing
• Driving Testing
• Others

Based on Test Type, the Autonomous Vehicle Testing Services Market is bifurcated into Software Testing, Simulation Testing, Driving Testing, and Others. To ensure communication, the vehicle must be able to communicate with other cars, infrastructure, and the environment, including other devices and networks. New autonomous vehicle testing approaches, combining real-world and virtual simulation tests, and respective regulations have to be developed for setting industry-wide standards to enhance the roll-out of driverless technologies.

Autonomous Vehicle Testing Services Market – By  Vehicle Type

• Passenger Car
• Commercial Vehicle

Based on Vehicle Type, the Autonomous Vehicle Testing Services Market is categorized into Commercial vehicles and Passenger cars. The rising adoption of electric and hybrid vehicles with various levels of automation has significantly triggered the demand for autonomous vehicles in transportation applications. Due to the increasing adoption of autonomous vehicles in transportation, the passenger car and commercial vehicle segments are estimated to grow significantly in the coming years. This is also a result of technological advancements and the increasing acceptance of autonomous vehicles by governments around the globe. Furthermore, clients are drawn to embrace autonomous vehicles for their commercial use by the improved technology provided by numerous businesses. Leading companies are collaborating to provide state-of-the-art autonomous driving experiences.

Autonomous Vehicle Testing Services Market – By  Vehicle Autonomy

• Level 1
• Level 2
• Level 3
• Level 4/5

Based on Vehicle Autonomy, the Autonomous Vehicle Testing Services Market is bifurcated into Level 1, Level 2, Level 3, and Level 4/5. Cars cannot drive independently in Level 0 autonomous driving technology. The car's systems only give out warnings and occasionally step in to help. These take the form of automatic emergency braking, lane departure warning, or blind-spot alarms.

In Level 1, the vehicle's controls are split between the driver and the autonomous systems. A Level 1 example would be cruise control or adaptive cruise control, which allows the driver to control the steering while the system handles the throttle and braking while maintaining a predetermined speed. Parking Assistance, where the opposite occurs, would be another feature of shared driving with Level 1. While the driver controls the speed, the automatic system handles the steering. When lane keep assist does not cooperate with adaptive cruise control, it is also categorized as Level 1.

At Level 2, the automated system can take complete control of the vehicle's steering, braking, and acceleration. However, if the system doesn't react as estimated, the driver must be ready to step in right away. At Level 2, Lane Keep Assist features can be used in conjunction with Adaptive Cruise Control. Cameras are typically used in vehicles with Level 2 systems to verify that the driver is paying attention to the road ahead.

The driver can safely divert their attention away from the road in a vehicle that meets Level 3 automation standards. The car can drive itself and doesn't need a driver to help it because it can handle most circumstances. They would, however, only function under specific circumstances. For instance, in addition to having a mobile data connection or GPS, the camera vision must not be blocked, the weather must be clear, and so on. At Level 3, the driver must also be prepared to step in. Traffic Jam Chauffeur, a function of Level 3 autonomous drive, aids the vehicle's operation in stop-and-go traffic. Another illustration would be completely automatic lane-keeping systems in vehicles, which of course would need to adhere to international regulations.

In Level 4, the automated system is so sophisticated that the car might have a steering wheel or not. The driver can sleep or even get out of the driver's seat in a car equipped with Level 4 technology. The capability, however, would only be functional in particular settings or while striking particular circus stances. Should the driver fail to regain control, these cars are built to cancel the trip and park safely. Level 4 would probably be applied to robotized taxis and delivery services operating in a certain region.

Level 5 autonomous driving technology eliminates the need for human involvement in a vehicle. A level 5 vehicle would be completely automated and capable of operating on any surface under any condition. In some places of the world, Level 4 autonomous vehicle technology is already in use. The implementation of Level 5 is anticipated for the far future.

Autonomous Vehicle Testing Services Market - By Region:

• North America
• Europe
• Asia-Pacific
• Rest of the World

In 2021, North America held the largest market share of more than 45% due to the region's high rate of adoption of autonomous vehicles, well-established automotive manufacturing infrastructures, presence of important manufacturers, strict traffic laws, adoption of cutting-edge technologies, and well-established systems of the road network. It is projected that the market for autonomous vehicles would receive a boost from the expansion of mobility as a service industry. Due to changes made to U.S. traffic laws to accommodate autonomous vehicles on public roads, North America is anticipated to experience tremendous development. All of the states in the United States are gradually adopting a regulation that will enable fully autonomous transportation.

Europe is anticipated to become a potentially lucrative market for the adoption of autonomous vehicles due to an increasing consumer preference for utilizing technologically advanced products. The government is also undertaking numerous attempts to improve autonomous vehicles. For instance, the Automated Lane-Keeping System (ALKS), which may automatically take control of vehicles driving at low speed, will be introduced in the U.K. in August 2020, according to the Department of Transport (DFT). With the use of this technology, the driver will be able to hand off driving duties to the vehicles, and the system will maintain lane compliance.

The Asia Pacific market is anticipated to gain pace throughout the forecast period due to rising per capita disposable income, rising standards of living, evolving traffic norms, and rising investments in the automotive industry.

Major Key Players in the Market

The major players in the global Autonomous Vehicle Testing Services Market are
Audi AG, Daimler AG, BMW AG, Ford Motor Company, Google LLC, General Motors Company, Honda Motor Co., Ltd., Tesla, Toyota Motor Corporation, Nissan Motor Company, Volvo Car Corporation, Uber Technologies, Inc., and Volkswagen AG.

Notable happenings in the Autonomous Vehicle Testing Services Market in the recent past:

Partnership- In May 2019, Alliance Venture and Plug and Play China formed a partnership. To foster open innovation and next-generation technologies in the automotive sector, Alliance Ventures wants to invest USD 1 billion by 2022.

Partnership- In July 2019, The BMW Group and Daimler AG engaged in a long-term agreement for the creation of automated driving solutions.   The development of cutting-edge technology for automated driving on highways, automated driver support systems, and automated parking systems is the main focus of the agreement.