Automotive Electronics Market Size - By Vehicle Type (Passenger Cars, Commercial Vehicles), By Application (ADAS, Body Electronics, Infotainment & Communication, Powertrain, Safety Systems) & Forecast, 2024-2032

Automotive Electronics Market Size

Automotive Electronics Market size was valued at USD 312.9 Billion in 2023 and is anticipated to register a CAGR of over 8.9% between 2024 and 2032. The rising awareness of road safety due to increasing accidents worldwide are driving the electronic component demand in vehicles. These components are used in several comfort & safety systems, such as ADAS, lane keeping & control systems, platooning & connected vehicles, and aid drivers in night driving. Increasing accidents due to driver negligence and unavoidable night driving situations such as drowsiness have resulted in the need for developing solutions in recent years.
 

Therefore, leading automakers are focusing on developing enhanced driver assistance, accident safety & in-vehicle comfort systems. For instance, in March 2022, Uhnder, a LiDAR technology provider for ADAS, launched the industry’s first 4D digital imaging radar for next-generation ADAS. The product facilitates next-generation ADAS & automated mobility applications with better accuracy and an enhanced sense of standing or moving objects at short & long distances.
 

The surge in automobile production is a major driver of the automotive electronics market, as it directly correlates with the increased integration of advanced electronic systems in vehicles. As manufacturers strive to meet growing consumer demand and differentiate their products, the inclusion of sophisticated electronics such as infotainment systems, advanced driver-assistance systems (ADAS), and power management systems becomes crucial. This trend is amplified by the rise of electric vehicles (EVs) and the shift towards more connected, autonomous driving technologies, which require advanced electronic components to function efficiently.
 

Furthermore, evolving safety regulations and consumer preferences for enhanced in-car experiences are pushing automakers to adopt cutting-edge electronics, thereby fueling market growth. The combination of these factors, driven by the broader surge in automobile production, is propelling the automotive electronics sector to new heights. For example, according to The European Automobile Manufacturers’ Association In 2022, 85.4 million motor vehicles were produced around the world, an increase of 5.7% compared to 2021.
 

The high costs associated with advanced driver assistance systems (ADAS) serve as a significant restraint on the growth of the automotive electronics market. While ADAS technologies, such as adaptive cruise control, lane departure warning, and automatic emergency braking, offer substantial safety and convenience benefits, their integration into vehicles involves expensive components and complex engineering. This drives up the overall cost of vehicles equipped with these systems, making them less accessible to cost-sensitive consumers, particularly in emerging markets.
 

Additionally, the development and validation of ADAS technologies require extensive research and testing, further contributing to their high price tags. As a result, the high costs can slow down the widespread adoption of ADAS, limiting the growth potential of the automotive electronics market despite increasing demand for advanced vehicle features.
 

Automotive Electronics Market Trends

The rise of electric vehicles (EVs) is significantly shaping the automotive electronics industry. As consumers and governments increasingly prioritize sustainability, EVs are becoming more prevalent, driving demand for specialized electronics. Key components such as battery management systems, power electronics for efficient energy conversion, and advanced infotainment systems tailored for EVs are seeing rapid development. This trend is also supported by the expansion of charging infrastructure and advancements in battery technology, which are critical for the broader adoption of EVs.
 

As the market evolves, the need for innovative, energy-efficient electronics solutions in EVs will continue to grow, positioning this segment as a pivotal area of focus within automotive electronics. For instance, According to IEA, In 2023, global electric vehicle (EV) sales reached nearly 14 million units, marking a 35% increase from the previous year. This surge brought the total number of electric cars on the road to approximately 40 million. Notably, electric cars represented about 18% of all new car sales globally, up from 14% in 2022.
 

The rise of autonomous driving technologies is a transformative trend in the automotive electronics market. Autonomous vehicles (AVs) rely heavily on an array of sophisticated electronic systems, including sensors, cameras, radar, and LIDAR, to navigate and interact with their environment safely. These systems are integral to enabling advanced driver-assistance systems (ADAS) and full self-driving capabilities.
 

Continuous advancements in artificial intelligence, machine learning, and sensor technology are accelerating the development of autonomous vehicles, driving up the demand for high-precision, reliable automotive electronics. For example, November 2022, The BMW 7 Series has integrated HERE Technologies' HD Live Map to enable its "Personal Pilot" Level 3 highly automated driving function This collaboration between BMW and HERE Technologies aims to advance high-definition mapping for ADAS and automated vehicle systems.
 

Automotive Electronics Market Analysis

Based on vehicle type, the market is segmented into passenger cars and commercial vehicles. In 2023, the passenger cars segment accounted for the largest market share with over 83% of the market share.
 

• The passenger cars segment accounted for the largest share of the automotive electronics market due to the higher volume of passenger car production compared to commercial vehicles naturally results in greater demand for automotive electronics. Passenger cars, being more numerous and diverse, require a wide range of electronic components, from basic infotainment systems to advanced driver assistance systems (ADAS). Additionally, consumer expectations for connectivity, safety, and comfort features in passenger vehicles continue to rise, prompting manufacturers to integrate more sophisticated electronics to meet these demands.
   
• Moreover, the surge in electric vehicle (EV) production, predominantly within the passenger car segment, has significantly contributed to this market dominance. EVs require specialized electronic systems for battery management, power conversion, and energy efficiency, further driving the demand for automotive electronics in this category. The adoption of autonomous driving technologies, also primarily explored in the passenger car market, accelerates the need for advanced sensors, processors, and control units, solidifying the passenger cars segment's leading position in the automotive electronics market.
   

Based on application, the automotive electronics market is divided into ADAS, body electronics, infotainment & communication, powertrain, and safety systems. In 2023, the ADAS segment was the fastest growing segment, growing at a CAGR of over 12%. The market value of the ADAS segment is expected to reach over USD 46 billion by 2032 due to this significant growth rate.
 

• Advanced Driver Assistance Systems (ADAS) segment emerged as the fastest-growing segment within the automotive electronics market, driven by increasing consumer demand for enhanced vehicle safety and convenience features. ADAS technologies, which include adaptive cruise control, lane-keeping assist, and automatic emergency braking, have become a key differentiator in the automotive industry. These systems not only enhance driving comfort but also significantly improve road safety by reducing human error, which is a leading cause of accidents. As regulatory bodies worldwide implement stricter safety standards, automakers are compelled to incorporate ADAS in a broader range of vehicles, accelerating the growth of this segment.
   
• Furthermore, advancements in sensor technologies, artificial intelligence, and machine learning have made ADAS more reliable and accessible, encouraging wider adoption across different vehicle categories, including mid-range and entry-level models. The integration of these advanced systems also aligns with the broader trend towards autonomous driving, as many ADAS features are foundational technologies for fully autonomous vehicles. The increasing prevalence of electric vehicles, which often come equipped with state-of-the-art electronic systems, further propels the ADAS segment, as these vehicles are typically designed with a focus on the latest technology, including advanced safety features.
   

Asia Pacific held the largest automotive electronics market share of over 48% in 2023. The region boasts some of the world's largest automotive manufacturing hubs, including China, Japan, and South Korea. These countries are not only leading producers of traditional vehicles but are also at the forefront of electric vehicle (EV) and autonomous vehicle development. The high concentration of major automakers and electronic component manufacturers in the Asia Pacific region facilitates the rapid integration of advanced automotive electronics, from ADAS to infotainment systems.
 

Additionally, the rising disposable incomes and urbanization in countries like China and India are fueling the demand for passenger cars, including luxury and mid-range vehicles equipped with the latest electronic technologies. This growing consumer base is increasingly seeking advanced features such as enhanced connectivity, safety systems, and comfort, which are driving the uptake of sophisticated automotive electronics. Moreover, supportive government policies, including subsidies for EVs and investments in smart infrastructure, further bolster the market's growth in the region, making Asia Pacific a pivotal player in the global automotive electronics landscape.
 

China stands as a dominant force in the automotive electronics market, fueled by its position as the largest automotive producer and consumer globally. The country’s rapid economic growth and increasing disposable incomes have led to a surge in vehicle ownership, including a growing appetite for advanced automotive features. China is also a major player in the electric vehicle (EV) sector, driven by government incentives, stringent emissions regulations, and substantial investments in EV infrastructure.
 

The country's focus on becoming a global leader in smart and connected vehicles has led to high demand for sophisticated automotive electronics, such as ADAS and infotainment systems. Additionally, China's robust manufacturing capabilities and extensive supply chain networks further bolster its dominance in the automotive electronics market.
 

The United States holds a significant share of the automotive electronics market, driven by its advanced automotive industry and high consumer demand for cutting-edge technology. The U.S. is a pioneer in the development and adoption of advanced driver assistance systems (ADAS) and infotainment technologies, with many automakers and technology companies investing heavily in innovation and R&D.
 

The growing emphasis on vehicle safety, connectivity, and autonomous driving solutions contributes to the robust demand for automotive electronics. Furthermore, supportive policies for electric vehicles and the expansion of smart infrastructure enhance the market’s growth prospects. The U.S. market is characterized by high-value electronics and a focus on integrating the latest technological advancements into both luxury and mainstream vehicles.
 

Japan is a key player in the automotive electronics market, renowned for its advanced technological innovations and strong automotive sector. The country is home to some of the world’s leading automotive manufacturers, who drive demand for cutting-edge electronics and systems. Japan’s focus on integrating advanced safety features, such as ADAS, and pushing the boundaries of hybrid and electric vehicle technology underpins the significant growth in automotive electronics.
 

The country also benefits from its expertise in electronics manufacturing and high standards for quality and reliability, which contribute to its leadership in developing sophisticated automotive components. Additionally, Japan's strategic investments in autonomous vehicle research and development further bolster its position in the global market.
 

South Korea plays a prominent role in the automotive electronics market, supported by its strong automotive industry and technological prowess. Major South Korean automakers are heavily investing in the development of advanced electronics, including ADAS and infotainment systems, to enhance vehicle performance and safety. The country’s emphasis on innovation and its competitive electronics sector enable the integration of state-of-the-art technologies into vehicles, driving market growth.
 

South Korea is also a significant player in the electric vehicle market, with increasing production and adoption of EVs, which further stimulates demand for specialized automotive electronics. The government’s supportive policies and investments in smart transportation infrastructure contribute to the thriving automotive electronics landscape in South Korea.
 

Automotive Electronics Market Share

Robert Bosch GmbH and Continental AG holds a significant share of over 15% in the market. The major players operating in the automotive electronics industry are Robert Bosch GmbH, Continental AG, ZF Friedrichshafen AG, Denso Corporation, and Aisin Seiki Co., Ltd. The ecosystem also involves prominent players including VALEO, BorgWarner Inc, Magna International, Inc., Broadcom Inc, and LEAR. The companies operating in the market are focusing on various growth strategies including strategic acquisitions, collaborations, opening new facilities, and launching new products, increasing their market shares.
 

Automotive Electronics Market Companies

Major players operating in the automotive electronics industry are:

• Robert Bosch GmbH
• Continental AG
• ZF Friedrichshafen AG
• Denso Corporation
• Aisin Seiki Co., Ltd.
• VALEO
• BorgWarner Inc.
   

Automotive Electronics Industry News

• In February 2024, Remsons Industries Ltd., a leading manufacturer of automotive components, has entered a 50:50 joint venture with Istanbul-based Daiichi Infotainment Systems to produce automotive electronics for the Indian market. The new joint venture company, Daiichi Remsons Electronics Private Limited, will focus on developing advanced electronic solutions for next-generation vehicles.
   
• In January 2023, Continental AG partnered with Ambarella, Inc., an edge AI semiconductor company, to develop scalable, end-to-end hardware & software solutions based on Artificial Intelligence (AI) for assisted and Automated Driving (AD). The strategic collaboration will equip ADAS with a full software stack.
   

The automotive electronics market research report includes in-depth coverage of the industry with estimates & forecast in terms of revenue (USD Million) from 2021 to 2032, for the following segments:

Click here to Buy Section of this Report

Market, By Vehicle Type

• Passenger Cars
• Commercial Vehicles

Market, By Application         

• ADAS
  • Adaptive Cruise Control
  • Blind Spot Detection
  • Parking Assistance
  • Automated Emergency Braking
  • Night Vision
  • Lane Department Warning
• Body Electronics
  • Audio
  • Display
  • Navigation
  • Head-up Display
  • Communication
• Infotainment & Communication
• Powertrain 
  • Engine Controllers
  • Transmission Drivetrains
  • Exhaust
  • xEV
• Safety Systems

The above information is provided for the following regions and countries:

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Spain
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • ANZ
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• MEA
  • UAE
  • Saudi Arabia
  • South Africa
  • Rest of MEA