Asia-Pacific Connected Car Market Outlook, 2029

Asia Pacific is at the forefront of technological innovation in the automotive industry, with leading automakers and tech companies investing in connected car technologies. From artificial intelligence and machine learning to the Internet of Things (IoT) and 5G connectivity, Asia-Pacific is embracing cutting-edge technologies to enhance the functionality and capabilities of connected cars. Furthermore, the Asia Pacific is home to some of the world's most populous cities, where traffic congestion and pollution are significant challenges.

Connected car technologies, such as predictive traffic management, smart navigation, and vehicle-to-infrastructure (V2I) communication, offer solutions to alleviate congestion, improve traffic flow, and enhance urban mobility in the region. Countries like Japan and South Korea are known for their leadership in automotive innovation, particularly in the development of connected car technologies. Companies in these countries are at the forefront of developing advanced features such as autonomous driving systems, vehicle-to-vehicle (V2V) communication, and smart mobility solutions. Governments in the Asia-Pacific region are increasingly recognising the potential benefits of connected cars for improving road safety, reducing traffic congestion, and promoting environmental sustainability. Many countries are implementing policies and initiatives to support the adoption and deployment of connected car technologies, such as providing subsidies for electric vehicles and investing in smart infrastructure. The connected car market in Asia Pacific is characterised by collaboration and partnerships between automakers, technology companies, telecommunications providers, and government agencies. These collaborations facilitate the development of integrated solutions, interoperable platforms, and industry-wide standards, driving innovation and accelerating the adoption of connected car technologies.

According to the report “Asia Pacific Connected Cars Market Outlook, 2029,”, the Asia Pacific Connected Car market is anticipated to grow with more than 15% CAGR from 2024-2029. Asia Pacific is home to some of the world's leading technology companies and research institutions, driving innovation in connected car technologies. Advancements in artificial intelligence, the Internet of Things (IoT), and 5G connectivity enable the development of advanced features such as autonomous driving, vehicle-to-vehicle (V2V) communication, and predictive maintenance. With rapid urbanisation, many people in the Asia-Pacific region live and work in densely populated urban areas.

Urban dwellers rely heavily on their vehicles for transportation, leading to a strong demand for connected car features that enhance convenience, navigation, and safety in city driving conditions. Cultural preferences and values influence consumer behaviour in the Asia-Pacific connected car market. For example, in countries like Japan and South Korea, where there is a strong emphasis on technology and innovation, consumers are more likely to embrace connected car technologies and prioritise features such as autonomous driving and smart mobility solutions. Government policies and regulations play a significant role in shaping the culture of the connected car market in the Asia-Pacific region. Governments may provide incentives for automakers and consumers to adopt connected car technologies, promote the development of smart infrastructure, and set standards for vehicle safety, emissions, and data privacy.

Market Drivers

• Rapid Urbanization: Rapid urbanisation in the Asia-Pacific region is a significant driver of the connected car market. As cities grow and populations concentrate in urban areas, traffic congestion becomes a major challenge. Connected cars offer solutions to urban mobility issues by providing features such as real-time traffic updates, predictive navigation, and smart parking assistance. These features help drivers navigate through congested urban environments more efficiently, saving time and reducing stress. Moreover, urban dwellers often value convenience and connectivity, making connected car features highly appealing in urban settings where people rely heavily on their vehicles for transportation.
• Growing Middle Class: The growing middle class in the Asia-Pacific region is driving demand for connected cars. As disposable incomes rise and lifestyles become more affluent, consumers are increasingly seeking vehicles with advanced features and technology. Connected cars offer a range of features, such as advanced infotainment systems, in-car Wi-Fi connectivity, and smartphone integration, which appeal to tech-savvy consumers who value convenience, entertainment, and connectivity while on the road. The growing middle class's desire for status, comfort, and the latest technology in their vehicles is propelling the adoption of connected car technologies in the Asia-Pacific market.

Market Challenges

• Consumer Acceptance and Adoption: One of the key challenges in the Asia-Pacific connected car market is consumer acceptance and adoption. Despite the growing popularity of connected car technologies, consumers may still have reservations or hesitations about embracing these technologies due to various factors such as cost, privacy concerns, and perceived reliability. For example, some consumers may be hesitant to invest in connected cars due to concerns about the initial purchase price or ongoing maintenance costs. Additionally, issues related to data privacy and security may undermine consumer trust in connected car systems, leading to reluctance in adoption. Addressing these concerns and educating consumers about the benefits of connected cars, such as enhanced safety, convenience, and connectivity, is essential to driving acceptance and adoption in the Asia-Pacific region.
• Cultural and Language Differences: The Asia-Pacific region is culturally diverse, with different countries and regions having their own unique preferences, languages, and cultural norms. This diversity presents challenges for automakers and technology providers operating in the connected car market, as they need to tailor their offerings to suit the specific needs and preferences of consumers in each market. For example, features that are popular in one country may not be as well received in another due to cultural differences or regulatory requirements. Similarly, language barriers may pose challenges for companies in terms of product localization, customer support, and marketing efforts. Overcoming these cultural and language differences requires a nuanced understanding of each market and a flexible approach to product development and marketing strategies.

Market Opportunity

• Emerging Mobility Trends: The Asia Pacific region is witnessing the emergence of new mobility trends enabled by connected car technologies, such as ride-sharing, car-sharing, and mobility-as-a-service (MaaS) platforms. These trends are reshaping the way people move in urban areas and creating opportunities for collaboration between automakers, technology providers, and transportation companies to develop integrated solutions that offer seamless and personalised mobility experiences.
• Government Support and Initiatives: Governments in the Asia-Pacific region are increasingly recognising the potential benefits of connected cars for improving road safety, reducing traffic congestion, and promoting environmental sustainability. Many countries are implementing policies and initiatives to support the adoption and deployment of connected car technologies, such as providing incentives for electric vehicles, investing in smart infrastructure, and setting standards for vehicle safety and emissions. These government initiatives create a favourable regulatory environment and provide opportunities for industry stakeholders to collaborate and innovate in the connected car market.

Based on the technology, they are segmented into 4G/LTE, 3G, and 5G. Furthermore, in terms of connectivity solutions, they are segmented into integrated, embedded, and tethered.

In Asia and the Pacific, 5G is growing as a technology. 5G networks offer significantly higher data speeds, lower latency, and greater capacity compared to previous generations of wireless technology. This high-speed connectivity enables seamless communication between connected cars and external networks, allowing for real-time data exchange, rapid response times, and enhanced user experiences. With 5G, connected cars can access and process large amounts of data more quickly and efficiently, enabling advanced features such as real-time navigation, HD video streaming, and over-the-air software updates.

5G technology enables vehicle-to-everything (V2X) communication, allowing connected cars to exchange information with other vehicles, pedestrians, traffic signals, and infrastructure in real-time. This capability enhances road safety by enabling features such as collision avoidance systems, intersection collision warning, and cooperative adaptive cruise control, which help prevent accidents and reduce traffic congestion. Additionally, 5G-powered V2X communication can improve traffic flow, optimise route planning, and reduce fuel consumption, contributing to greater efficiency and sustainability in transportation. Furthermore, integrated connectivity solutions contribute the highest market share. Integrated connectivity solutions provide a seamless user experience by combining various connectivity features, such as in-car Wi-Fi, smartphone integration, navigation services, and entertainment options, into a unified platform. This seamless integration enhances the overall driving experience for consumers, allowing them to stay connected, entertained, and informed while on the road. Integrated connectivity solutions streamline the user interface and interaction with connected car features, making it easier and more convenient for drivers and passengers to access and control various functions from a central dashboard or infotainment system. This efficiency improves user productivity and reduces distractions while driving, enhancing safety and convenience.

According to the report, applications are segmented into Driver Assistance, Safety, Infotainment, Telematics, Fleet Management (Vehicle), Mobility Management, and Others. Furthermore, in terms of the end user, they are segmented into OEMs and aftermarket.

In Asia Pacific, telematics significantly contributes to the connected car market. Telematics systems enable real-time monitoring of vehicle performance, location tracking, and driver behaviour analysis. This data can be used to improve road safety by providing alerts for risky driving behaviours, such as speeding or harsh braking, and facilitating emergency assistance in the event of accidents or breakdowns. In the Asia-Pacific region, where road safety is a significant concern, the implementation of telematics solutions can help reduce accidents and improve overall road safety. Telematics systems are widely used in commercial fleets to optimise vehicle utilisation, reduce fuel consumption, and improve operational efficiency.

Fleet managers can use telematics data to track vehicle location, monitor fuel consumption, and schedule maintenance, resulting in cost savings and improved productivity. With the growing demand for logistics and transportation services in the Asia-Pacific region, telematics solutions play a crucial role in managing large fleets of vehicles and ensuring efficient operations. Furthermore, OEMs significantly contribute to the connected car market; they have established brand recognition, trust, and loyalty among consumers in the Asia-Pacific region. Consumers often prefer to purchase vehicles from reputable OEMs with a track record of quality and reliability. By offering connected car features as standard or optional equipment in their vehicles, OEMs can leverage their brand reputation to drive adoption and acceptance of connected car technologies among consumers. OEMs benefit from economies of scale in manufacturing, procurement, and distribution, allowing them to offer connected car features at competitive prices. By leveraging their production capabilities and supply chain networks, OEMs can reduce costs and increase efficiency in producing connected vehicles. This enables OEMs to offer a wide range of connected car features and options across their vehicle lineup, catering to different customer segments and preferences in the Asia-Pacific market.

Based on the report, the major countries covered include China, Japan, India, Australia, South Korea, and the rest of Asia Pacific.

In Asia Pacific, China leads the connected car market. China has the largest automotive market in the world, with a rapidly growing middle class and increasing urbanization. This large consumer base creates significant demand for connected car technologies as consumers seek vehicles with advanced features, connectivity, and convenience. The Chinese government has been actively promoting the development and adoption of connected car technologies as part of its broader initiatives to upgrade the country's automotive industry and foster innovation.

The government has implemented policies and incentives to support the development of connected car technologies, such as subsidies for electric vehicles, investment in smart infrastructure, and regulatory reforms to facilitate autonomous driving and connected vehicle deployment. Furthermore, China is home to a robust automotive manufacturing ecosystem, with a large number of domestic and international OEMs producing vehicles for the domestic and global markets. This strong manufacturing base enables the mass production and deployment of connected vehicles, driving economies of scale and reducing costs for consumers. China is home to a vibrant ecosystem of innovative startups and technology companies that are driving innovation in the connected car market. Tech giants such as Huawei, Baidu, and Tencent are investing heavily in connected car technologies and collaborating with automakers to develop integrated solutions. These companies bring expertise in areas such as telecommunications, cloud computing, and artificial intelligence, enabling them to develop cutting-edge connected car solutions tailored to the Chinese market.

The competitive landscape of the connected car market is dynamic and characterized by the presence of diverse players spanning automotive manufacturers, technology companies, telecommunications providers, and startups. These entities contribute to the development, integration, and proliferation of connected car technologies. Traditional automotive manufacturers play a significant role in the connected car market by integrating connectivity features directly into their vehicles. Companies such as General Motors, Ford, Toyota, and BMW are incorporating advanced infotainment systems, telematics, and driver assistance technologies into their vehicles. OEMs often collaborate with technology partners to enhance their connected car offerings.

Technology giants are increasingly entering the connected car space, leveraging their expertise in software, artificial intelligence, and cloud computing. Companies like Apple, Google (through Android Auto), and Microsoft are developing platforms and ecosystems that seamlessly integrate with connected vehicles, providing services such as voice-activated controls, navigation, and in-car entertainment. The success of connected cars relies heavily on robust communication networks. Telecommunications companies like Verizon, AT&T, and Vodafone play a crucial role by providing the necessary connectivity infrastructure, including 4G and 5G networks. These providers are pivotal in enabling real-time data transfer, over-the-air updates, and other connected car services. Automotive suppliers, often referred to as Tier 1 suppliers, contribute essential components and systems to connected cars. Companies like Bosch, Continental, and Denso specialize in providing sensors, communication modules, and other hardware crucial for the functioning of connected car technologies. These suppliers work closely with OEMs to integrate advanced systems seamlessly. The connected car market is also influenced by a multitude of startups and niche players specializing in specific aspects of connectivity. These include companies focusing on cybersecurity for connected vehicles (e.g., Argus Cyber Security), AI-powered navigation (e.g., WayRay), and advanced driver assistance systems (e.g., Mobileye). These players often bring innovation and agility to the market, contributing to its overall dynamism.

Considered in this report

• Historic year: 2018
• Base year: 2023
• Estimated year: 2024
• Forecast year: 2029

Aspects covered in this report

• Connected Car market Outlook with its value and forecast along with its segments
• Various drivers and challenges
• On-going trends and developments
• Top profiled companies
• Strategic recommendation

By Technology

• 4G/LTE
• 3G
• 5G

By Connectivity Solutions

• Integrated
• Embedded
• Tethered

By Application

• Driver Assistance
• Safety
• Infotainment
• Telematics
• Fleet Management (Vehicle)
• Mobility Management
• Others

By End Market

• Original Equipment Manufacturer (OEMs)
• Aftermarket

The approach of the report:

This report consists of a combined approach of primary and secondary research. Initially, secondary research was used to get an understanding of the market and list the companies that are present in it. The secondary research consists of third-party sources such as press releases, annual reports of companies, and government-generated reports and databases.

After gathering the data from secondary sources, primary research was conducted by conducting telephone interviews with the leading players about how the market is functioning and then conducting trade calls with dealers and distributors of the market. Post this; we have started making primary calls to consumers by equally segmenting them in regional aspects, tier aspects, age group, and gender. Once we have primary data with us, we can start verifying the details obtained from secondary sources.

Intended audience

This report can be useful to industry consultants, manufacturers, suppliers, associations, and organizations related to the Connected Car industry, government bodies, and other stakeholders to align their market-centric strategies. In addition to marketing and presentations, it will also increase competitive knowledge about the industry.


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