Metaverse in Automotive Market Size (2024-2030)

The Metaverse in Automotive Market was valued at USD 1.9 billion in 2023 and is projected to reach a market size of USD 20.62 billion by the end of 2030. Over the forecast period of 2024-2030, the market is estimated to grow at a CAGR of 40.58%.

Metaverse is an immersive virtual environment that can support a arrange of online interactions. It is observed as a very lucrative market, with integration steadily expanding across industries and others. From product design to procurement, manufacturing to inventories, Metaverse technology may be used to narrow and optimize supply chain management in the Automotive Industry. Through strategic interactions with professionals such as Engineers and material experts in real-time, metaverse platforms can also encourage designers to develop shapes and study novel materials, combinations ad components. Metaverse technology can also aid in the fastening up of the design process by allowing manufacturers to effectively share 3D prototypes of items.

Key Market Insights:

• According to a report by NFT Studios, the cost of a Metaverse Project can cost around USD 10,000 to USD 3,00,000, with approximate cost of USD 1-4 million cost for a team of developers. Huge projects, like Facebook’s Metaverse, cost of the Company around USD 2.7billion in just the first 3 months since its launch for upkeep and maintenance.
• Europe’s Metaverse market is fast-moving due to the widening gaming sector in countries such as Germany, France and UK. Government initiatives such as AEGLE and MIDAS are also expected to boost deployment into market. For example, Facebook is expected to provide about 10,000 jobs in the European Union.
• Shanghai recognizes the potential of Metaverse initiatives to revolutionize the tourism sector by providing unique and customized experiences such as AR tourist guides, Metaverse entertainment experiences, blockchain-based artwork and AI integration. Shanghai expects to generate 50 billion yuan (USD 6.9 billion) in yearly revenue by the end of 2025 by leveraging the power of immersive technologies to strengthen its cultural and tourism offerings.

Metaverse in Automotive Market Drivers:

• Brand promotions for Automotive OEMs with the help of gamification fueling market reach.

Several Companies in the Automobile Industry are taking advantage of the gaming part of the Metaverse to develop brand awareness. They are strategically utilizing Metaverse for engaging in Metaverse-based promotions and sponsorships. These Companies capitalize by gamifying their brands through immersive online participation and virtual world simulators. Few metaverse projects that gamify brand awareness include Mobility Adventure by Hyundai Motor Company and Roblox and Moving Platform by Volkswagen AG and Microsoft among rest. People participate in these 3D worlds to play mini-games, connect with other gamers, socialize, make friends and get product information through salesmen, chatbots or virtual AI agents. Metaverse makes brand promotion interesting and interacting for young customers.

The metaverse vendors are witnessing new revenue sources from the opportunities in sectors such as VR, AR, XR, Cloud gaming, AI in social media, E-sports, virtual fitting rooms and AR/VR hardware and peripherals.   

Metaverse in Automotive Market Restraints and Challenges:

Metaverse hardware requires devices for extended reality (AR, VR and MR) along with semiconductor components, sensors, trackers and other state-of-the-art equipment. These devices used in metaverse also make use of 3D and other advanced technologies to generate a realistic-looking virtual environment, which increases their costs. The enterprise-grade metaverse software such as engines, 3D modelling software and rendering tools are costly. Additionally, the installation of XR devices and solutions requires additional expenditure. Their maintenance costs further escalate the overall investments required to adopt this technology. Therefore, such high installation and maintenance costs are assumed to affect the growth of the Metaverse market globally.

Security and privacy issues are major concerns that VR, AR and MR adoption is facing. These problems have arisen due to the inconsistencies in programming and negligence and oversight of both developers and end users of apps and devices.

Metaverse in Automotive Market Opportunities:

AR, VR, and MR are expected to find applications in the automotive infotainment space in the future years. OEMs have already began developing or partnering with other companies to provide AR/VR-based infotainment using Metaverse. For example, in CES 2019, Nissan announced the development of its invisible-to-visible (i2V) technology that can link the driver and the passengers to the metaverse. People can appear as 3D AR avatars within the cars. It also keeps a track of the vehicle's immediate surroundings and anticipates what lies ahead. Similarly, In March2022, Audi partnered with start-up Holoride. The collaboration will introduce VR in-car entertainment to Audi cars. The passengers in the back seat of the Audi car can wear VR glasses and have an immersive VR experience of games, videos, and other interactive entertainment content. The Holoride technology also synchronizes the real-time driving motions of the vehicle.

METAVERSE IN AUTOMOTIVE MARKET REPORT COVERAGE:

Metaverse in Automotive Market Segmentation:

Metaverse in Automotive Market By Technology:

• Non-Fungible Token (NFT)
• Blockchain
• Virtual Reality (VR)
• Augmented Reality (AR)
• Mixed Reality (MR)
• Extended Reality (XR)

Virtual Reality is assumed to dominate other technology segments in terms of revenue share over the estimated period owing to the increased usage of Virtual Reality devices by Engineers and Designers to share VR car models, rapid development of virtual platforms by third parties that can benefit automakers and advancements in virtual test environments to ensure better interaction with customers and streamline supply chain.

Metaverse in Automotive Market By Application

• Advertising
• Online car purchasing
• Designing
• In-car entertainment
• Others

In-Car entertainment segment revenue is expected to stretch significantly over the future years, attributable to the higher usage of VR platforms to create in-vehicle reality entertainments systems, growing collaborations between Automotive manufacturers and gaming companies to create online entertainment platforms, development of cars particularly designed for Metaverse and rapid integration of AR and VR technologies to seamlessly mix virtual and real world for drivers and customers in a vehicle. Furthermore, technological advancements in entertainment solutions and integration of XR and real-time motion data to create engaging experiences for users are some other key elements estimated to support revenue growth of this segment over the upcoming years.

Metaverse in Automotive Market By Region:

• North America
• Asia-Pacific
• Europe
• South America
• Middle East and Africa

North America is expected to be the largest market in the Automotive Metaverse industry due to the presence giant players in software and hardware sector such as Microsoft, Meta, Unity Technologies, among others. Automotive OEMs such as General Motors and Ford have been implementing this technology for designing cars, providing immersive experiences to users (through virtual showrooms). Many tech-oriented start-ups in the region are also emerging as significant providers of metaverse related solutions to many businesses around the globe. Companies like Roblox Corporation, The Sandbox, Infinite World and Upland are providing open world class experiences to tech savvy users. Users can now sell, purchase and monetize their assets in the virtual space through digital money i.e., NFTs without using actual money.

COVID-19 Impact Analysis on the Metaverse in Automotive Market:

Initial issues over a disruption in Chinese parts exports quickly pivoted to large-scale manufacturing interruptions across Europe. In the United States, assembly plant closures contributed to the intense pressure on an increasingly distressed global supply base where companies were at fear of defaulting on covenants, potentially requiring banks to step in. The exogenous shock and uncertainty of the coronavirus pandemic exacerbated the existing downshift in global demand that led to increased Mergers and Acquisitions activity as opportunities for sector consolidation arise for Private Equity players.

Latest Trends:

The internet has seen users who use online games for recreational activities. This has made them to grow the metaverse as it gives a better interface than traditional online gaming platforms. Using equipment and platforms such as VR headsets, smart helmets and MR displays has aided them to improve the gaming experience, leading to increased use of Metaverse by gaming developers. Thus, this has led to the development of the market CAGR. The rising interest in cryptocurrency has also aided to expand its usage. The rising popularity of NFTs amongst the younger generation has also led to increased use of Metaverse. As per CNBC, the market for NFTs increased by 210% from 2021 to 2022. Retailers and luxury brands have also utilised Metaverse to capture consumers by selling limited edition goods, such as Gucci's partnership with Roblox to sell limited edition bags and let players win accessories through games. Similarly, artists such as Ariana Grande and Imagine Dragons have played concerts in the Metaverse.

Key Players:

1. Meta Platforms Inc.
2. Nvidia
3. Microsoft Corporation
4. Tencent Holdings Ltd.
5. Bytedance
6. Epic Games
7. Netease Inc.
8. Roblox Corporation
9. Lilith Games
10. Nextech AR Solutions Inc

Recent Developments:

• In February 2022, Cupra, a subsidiary of the Volkswagen group, launched Metahype, which will serve as a collaborative space where brands, startups and content creators can collaborate and host a wide variety of events and experiences for the users.

• In January 2022, Unity Technologies and Hyundai Motor Company made it public about their plans to develop a digital twin setup for Hyundai’s factories in the coming years. This will enable faster process time for Hyundai’s factories and a decrement in operational errors due to tests in simulated environments.
• In January 2022, Mercedes-Benz introduced its first ever NFT in collaboration with Art2People. The Company’s first Non-Fungible Token will be based on its G-Class car line.