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The global autonomous cars market size was valued at USD 1.82 billion in 2019 and is projected to reach USD 1.33 billion by 2027, exhibiting a CAGR of 3.3% during the forecast period.
The autonomous vehicle is also known as a driverless car or self-driving car that has the ability to read and sense the environment and operates with minimal or no human input. Self-driving cars have become the major revolution in automation and connectivity technology. Computers, internet, smartphones, and advanced technologies are merging with the vehicles to assist and automate the driving operations.
Rapid improvement in the sensor-processing technologies, high-definition mapping, adaptive algorithms, as well as the deployment of infrastructure-to-vehicle and vehicle-to-vehicle communication technologies are encouraging several companies to expand their production capacities and take vehicle automation to the next level. By increasing the automated vehicle travel, it is likely to reduce vehicle operating costs, increase travel convenience and comfort, as well as encourage longer-distance commutes. Also, prominent players are contributing in the development of highly and fully automated cars and have announced their arrival by this decade.
COVID-19: Restrictions on Cross Border Trade to Impact Growth Severely
The outbreak of coronavirus originated in Wuhan, China in December 2019, and later spread rapidly in the other parts of the world. The World Health Organization (WHO) declared it a pandemic as it has affected a large number of populations across several countries. In order to control the colossal spread of the virus, the governments of various nations declared lockdown and also imposed various policies such as social distancing which led to the temporary close down of the manufacturing and service industries. The trade among countries has also been restricted thus hampering the supply chain industry. Also, the economic conditions and total civilization has been affected largely.
Along with several other industries, the automotive industry has also been impacted and is facing several challenges to sustain in the market amid the novel coronavirus pandemic. China being the major contributor in the rapid development of the automotive industry and a significant distributor of various automobile components and technologies to many countries, has been impacted owing to the stringent restrictions on cross border trade. This has severely affected the sales of automobiles across the globe.
Moreover, the financial condition of various businesses has been largely affected which has compelled them to recover their damages and losses instead of investing in other activities. The autonomous vehicle market is also expected to showcase a decline for a provisional period as consumers will be focusing more on fulfilling the basic necessities rather than spending on luxury products.
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Autonomous Ride Sharing Technology is a Positive Trend for Market Growth
Autonomous cars are one of the major innovations to arise in the automotive and transportation industry. Vehicle automation coupled with ride-hailing technology has induced several prominent players to invest high capitals in the driverless ride sharing market. By understanding the patterns of travelers, companies are focusing to improve safety, free consumers from the liability of private vehicle ownership, and adapt with the significant changes in the city infrastructure.
Stringent Norms and Increasing Support of Government Pertaining to Safety of Vehicles will Drive Growth
The commercialization of autonomous vehicle technology is expected to alter the transportation network across the world. The governments of several countries are initiating stringent safety norms and are promoting automation in vehicles to cater to the safety and security of the vehicles, passengers, and pedestrians.
Moreover, automotive sector manufacturers are required to comply with the specifications and obtain the safety levels set by various organizations, such as the New Car Assessment Program (NCAP), the Institute of Highway Safety Insurance (IIHS), and the International Automobile Technology Center (ICAT) in order to access the authorization of vehicles. Safety regulations include seat belt warning, electronic stability control, parking sensors, autonomous emergency brakes, and front end air bags for driver and co-driver.
In 2017, Chinese Ministry of Industry and Information Technology (MIIT) along with the Government of China announced their plan and drafted a bill for developing technological and innovative autonomous driving platform for self-driving vehicles to become the world’s leading player.
Widespread Adoption of ADAS to Boost Market Growth
Advanced driver assistance systems (ADAS) assists drivers through their artificial intelligence and other advanced features, thereby avoiding distractions and reducing the pressure on the driver. The rapid adoption of advanced technologies in software algorithms, sensors, cameras, processors, and mapping has improved the applicability of ADAS in vehicles. Owing to the rising concerns of safety and security of vehicles, occupants, and pedestrians and to reduce the rate of road fatalities, automotive manufacturers are incorporating ADAS in vehicles, thus fuelling the autonomous cars industry growth.
High Initial Cost & Risk of Malfunctioning May Restrain Growth
The autonomous car technology is a developing market in the communication technology and automotive industry. It provides several technologically advanced safety features, greater comfort, and security to the vehicles and their occupants. However, the in-vehicle services incur additional costs associated with the telecommunications services, connectivity solutions charges, and hardware systems which may limit the market growth. Also, these highly technological systems posses many challenges and complications such as malfunctioning and failures. In addition to that, the high risk of hackers accessing the system data and unauthorized access to the vehicle functions may hamper this market growth.
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Semi-Autonomous Segment to Dominate Backed by Rising Technological Development
Based on type, the autonomous cars market is segmented into semi-autonomous and fully autonomous. The semi-autonomous cars segment accounts for the major share in the global market. The semi-automatic and self-driving car markets have been subdivided according to the degree of automation (at levels 1, 2, and 3 respectively). The level 2 and level 3 automation of the semi-autonomous segment is expected to show the fastest growth. However, currently, its adoption rate is moderate, but owing to the increasing technological development, its penetration rate is quite higher, as compared to level 1.
The semi-autonomous vehicle segment comprises various ADAS features such as intelligent park assist and adaptive cruise control among others. Intelligent park assists and automatic emergency braking sub-segments are expected to show the fastest growth in the market owing to the government mandates regarding the implementation of driver assistance systems. According to National Highway Traffic Highway Safety Association (NHTSA), automatic emergency braking systems are expected to be a standard in vehicles by the end of 2022.
Passenger Car Segment to Hold Largest Share Owing to Rapid Urbanization
Based on the vehicle type, the market is segmented into passenger cars and commercial vehicles. The passenger car segment holds the maximum share of the global market. The increasing urbanization, high demographic growth, improved living standards, and the rising purchasing power are the primary factors for the high growth of car production across the globe. Besides, the government and organizations of various regions are investing a high percentage in the development of technologically advanced features in vehicles. The rising demand for cars with enhanced safety features, comfort, and convenience are creating high traction for automated vehicles.
The commercial vehicle segment is also showing an exponential growth in the market. The European Union (EU), in partnership with the Ensemble consortium and the Netherlands organization for applied scientific research are planning to implement a multi-brand truck platooning on European highways to improve traffic capacity, fuel consumption, as well as reduce CO2 emission in Europe.
Asia Pacific Autonomous Cars Market Size, 2019 (USD Billion)
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The autonomous vehicles market size in Asia Pacific stood at USD 0.81 billion in 2019. The region holds dominance in the global market owing to the increasing adoption of autonomous vehicles and the growing consumer preferences for technologically advanced features. Automotive companies are planning to expand production units and achieve rapid technological advancement in manufacturing facilities in the emerging countries, such as India and China.
Additionally, the Government of China is vigorously working to achieve a competitive advantage in self-driving vehicle technology. Also, the governments of various countries are permitting self-driving car testing on public roads under certain norms and conditions.
Europe holds the second largest autonomous cars market share in the global market owing to the extensive investments by prominent manufacturers for the development of advanced technologies. The British government is committed to installing self-driving cars on the roads by the end of 2021 and plans to make the necessary changes to the regulations to support the development of autonomous vehicles in the U.K.
Robert Bosch GmbH is a Key Player Stoked by its Extensive Research & Development Activities
Robert Bosch GmbH is a global leader in the field of autonomous vehicle technology. The deployment of a wide range of advanced driver assistance solutions, as well as the development of self-driving vehicles for the intelligent and safe era of mobility are the key visions of the company. Also the constant R&D efforts by the company is leading to the creation of innovative technologies, which are some of the prominent factors responsible for the dominance of the company.
However, Waymo, Pony.ai, AutoX, and Baidu have also retained their positions in the competitive landscape. These companies significantly control the Asia-Pacific region. This is expected to affect the global market, as they are set to boost the technology innovation in the autonomous vehicle market during the forecast period.
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The autonomous cars market report provides a detailed analysis of the market and focuses on key aspects such as the leading companies, product types, and leading applications of the product. Besides this, the report offers insights into the market trends and highlights key industry developments. In addition to the factors above, the report encompasses several factors that have contributed to the growth of the market over recent years.
An Infographic Representation of Autonomous Cars Market
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Value (USD billion) & Volume (thousand units)
By Vehicle Type
Fortune Business Insights says that the global autonomous cars market size was USD 1.82 billion in 2019 and is projected to reach USD 1.33 billion by 2027.
In 2019, the Asia Pacific market value stood at USD 0.81 billion.
The market is projected to grow at a CAGR of 3.3% in the forecast period (2020-2027).
The semi-autonomous type segment is expected to be the leading segment in this market during the forecast period.
Stringent norms and the increasing support of the government pertaining to the safety of vehicles are the key factors driving the global market.
Robert Bosch GmbH is the leading player in the global market.
Asia Pacific dominated the market in terms of share in 2019.
The widespread usage of ADAS is expected to drive the adoption of these vehicles.
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