Automotive

Automotive Artificial Intelligence Market Size to Surpass USD 35.71 Bn by 2033

The global automotive artificial intelligence (AI) market size reached USD 3.22 billion in 2023 and is expected to surpass USD 35.71 billion by 2033, notable at a CAGR of 28% from 2024 to 2033.

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Key Takeaways:

North America dominated the market with the largest market share of 36.8% in 2023.
Asia Pacific is estimated to expand at the fastest CAGR during the forecast period.
By Offering, the hardware segment contributed more than 72.6% of revenue share in 2023.
By Offering, the Software segment shows significant growth during the forecast timeframe.
By application, the semi-autonomous driving segment held a 46% revenue share in 2023.
By application, the autonomous driving segment is predicted to grow at a CAGR of 27.8% between 2024 and 2033.
By technology, the machine learning segment accounted highest revenue share of over 34.8% in 2023.
By technology, the natural language processing segment is expected to record a CAGR of 29.4% from 2024 to 2033.
By process, the voice recognition segment captured around 32.8% of revenue share in 2023.
By component, the memory and storage systems segment contributed more than 23.3% of revenue share in 2023.

The development in the auto business is supposed to drive the automotive artificial intelligence market. The car business has encountered the guarantee of man-made consciousness and is among the significant enterprises utilizing AI to increase and copy the activity of people. Besides, the development of norms like high-level driver helps framework (ADAS), versatile voyage control (ACC), vulnerable side caution, and development sought after for comfort highlights draw in auto merchants towards AI.

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Computerized reasoning (AI) frameworks are utilized to change, cycle, and capacity information and calculations to emulate the scholarly elements of the human brain, and gain the ability to naturally retain and determine issues. Vehicles with self-driving highlights are bound to take on such frameworks to work on their productivity and working.

Automotive Artificial Intelligence (AI) Market Scope

Report Coverage	Details
Growth Rate from 2024 to 2033	CAGR of 28%
Market Size in 2023	USD 3.22 Billion
Market Size by 2033	USD 35.71 Billion
Base Year	2023
Forecast Period	2024 to 2033
Segments Covered	Offering, Technology, Application, Process, Component, and Geography

Market Dynamics

Drivers

The increasing market revenue due to the technological advancements

The growing positive knowledge among purchasers concerning free progressions will enhance the market pay. As purchasers are rapidly taking on driver-assist progress with reducing the driving weight and assurance of road prosperity, the interest for autonomous vehicles will flood beneficially throughout the gauge timeframe. Auto producers are noticing these examples and are offering innovative driver-assist replies with acquiring a high ground. Another variable adding to the automotive artificial intelligence Market share is the growing revenue for driver convenience and further creating permission to adaptability.

Restraints

Lack of awareness and high cost of Artificial Intelligence-based Automobiles

Independent vehicles have made the existence of customers protected and advantageous. Notwithstanding, there are sure dangers that are looked at by the makers connected with security and protection concerns like the wellbeing of individual information, digital assaults, and driver interruptions. For example, around 1.4 million Fiat Chryslers were reviewed in the US because of an error in their dashboard PCs that allowed programmers to debilitate the vehicle. Essentially, white cap programmers were effective in embedding malware into the arrangement of a Tesla vehicle. These examples of meddling with client security are a portion of the significant restrictions in the market development.

Opportunities

Growing advancements in the automotive technology are estimated to generate higher revenues

The vehicle area is near the very edge of a huge disturbance. Visionary automakers have started executing creative advances in their items and cycles to remain one stride in front of their industry peers. Man-made brainpower and information science mix has helped auto producers yet in addition to part providers, programming suppliers, vehicle rental firms, and other car-related undertakings. In the broadest sense, one can partition AI in the auto space into three classes, particularly concerning vehicles. There’s the vehicle plan and creation. There’s the purchasing venture.

Challenges

Lack of trust among consumers is one of the major challenges faced by the market

Another worry automakers are right now confronting is acquiring the client’s trust. While fairly prepared for a vehicle to help out and about, the equivalent isn’t valid for self-driving vehicles. The eagerness of individuals to believe AI in vehicles is expanding at an exceptionally sluggish rate: the numbers were unaltered through 2020 and 2021, with just an 8% ascent from 2019. This is the way things look now: current clients maintain that a vehicle should be utilitarian, agreeable, safe, give extra infotainment usefulness, yet stay subordinate (not overwhelmed) while out and about.

Recent Developments

In February 2021, Volkswagen Group and Microsoft are planning to increase their collaboration concerning the cloud computing technology of the American software giants to include stepping up the advancement of automatic driving.
In May 2021, Volvo Cars, a world leader in automotive safety, and Didi Chuxing, the top mobility technology platform in the world, announced a strategic partnership agreement on autonomous cars for DiDi’s self-driving test fleet. Volvo Cars will collaborate with DiDi Autonomous Driving to implement the additional software and hardware necessary to make the XC90 cars completely prepared for autonomous driving. These cars will be equipped with the backup systems required for operations like steering and braking.
In Dec 2019, Tesla teamed up with Nvidia to further develop its AI-coordinated semiconductors. A portion of Nvidia’s most brilliant personalities teamed up with Tesla to foster AI chips sufficiently shrewd to control vehicles with full self-driving capacity. These chips will guarantee that vehicles navigate motorways, yet additionally nearby roads and traffic lights.