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Primary Catalyst Driving Automotive Artificial Intelligence Market Evolution in 2025: Rising Demand For Autonomous Vehicles Fuels Automotive Artificial Intelligence Market Growth Driver
Automotive Artificial Intelligence Market Outlook
The surge in interest for self-driving vehicles is poised to accelerate the expansion of the automotive artificial intelligence industry. The use of AI is extensive in the automobile sector, and as technology continues to progress, the industry has capitalized on these advancements to introduce new methods of autonomous driving. One of these methods is the utilization of AI in the creation of self-driving vehicles. These are also termed as autonomous or driverless cars, and they can navigate to various destinations without human intervention, using an array of sensors, radars, cameras, and, of course, artificial intelligence. For instance, Deloitte predicts that the global automotive AI industry will reach an overall worth of approximately $27 billion in 2025. Thus, the increasing popularity of automated vehicles aids in boosting the growth of the automotive AI sector.
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How will the growth rate of the automotive artificial intelligence market shape industry trends by 2034?
There has been significant expansion in the size of the automotive artificial intelligence market in the latest years. The market is forecasted to rise from $3.75 billion in 2024 to $5.22 billion in 2025, reflecting a compound annual growth rate (CAGR) of 39.1%. The proliferation of connected cars and IoT in the automotive sector, the application of AI for predictive maintenance in vehicular systems, the incorporation of AI in the development of autonomous vehicles, and a growing focus on vehicle personalization via AI have all contributed to the historical growth.
The market size of automotive artificial intelligence is anticipated to witness remarkable growth in the coming years. By 2029, it is projected to reach $18.43 billion, growing at a compound annual growth rate (CAGR) of 37.1%. This growth during the forecast period can be attributed to factors such as rising popularity and awareness, increased demand for luxury cars, an upswing in demand for fully digitized electric cars, the integration of sensors and other components in AI systems, and the introduction of software aids that render vehicles fully autonomous. Key trends for the forecast period encompass the creation of AI chips specifically for automotive applications, the focus on interpretable AI in automotive decision-making, the incorporation of AI for the recognition of gestures and emotions in cars, the implementation of AI in fleet management and logistics, and the application of AI for improved interaction between humans and machines in vehicles.
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What trends are poised to drive the future success of the automotive artificial intelligence market?
Leading firms in the automotive artificial intelligence market are channeling their efforts into creating innovative technologies such as AI-driven diagnostic systems for aftermarket automobiles. These systems leverage artificial intelligence to peruse car data and identify issues in vehicles that are outside their warranty period from the manufacturer. Take for example, Mytvs-ki Mobility Solutions, an automobile repair and maintenance firm based in India, that in August 2024 launched Drivenostics. This is an AI-led diagnostics platform made specifically for the aftermarket car segment. The revolutionary service allows customers to keep track of their vehicle's health status in real-time via a chain of 1,000 service centers. Drivenostics, targeting an estimated 10-12 million vehicles particularly those above 4 meters in length, provides customized maintenance advice based on its AI-powered diagnostics.
Which primary segments of the automotive artificial intelligence market are driving growth and industry transformations?
The automotive artificial intelligence market covered in this report is segmented -
1) By Component: Hardware, Software, Service
2) By Type: Automatic Drive, ADAS
3) By Process: Signal Recognition, Image Recognition, Data Mining
4) By Technology: Deep Learning, Machine Learning, Context Awareness, Computer Vision, Natural Language Processing
Subsegments:
1) By Hardware: Processors And Microcontrollers, Sensors (LiDAR, Cameras, Radar), Edge Computing Devices, Connectivity Modules
2) By Software: Machine Learning Algorithms, Computer Vision Software, Natural Language Processing (NLP), Autonomous Driving Software, Predictive Analytics Tools
3) By Service: AI Integration Services, Data Management And Analytics Services, Maintenance And Support Services, Consulting Services
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Which geographical regions are pioneering growth in the automotive artificial intelligence market?
North America was the largest region in the automotive artificial intelligence market in 2024.Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the automotive artificial intelligence market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa
Who are the influential players reshaping the automotive artificial intelligence market landscape?
Major companies operating in the automotive artificial intelligence market include DiDi Chuxing Technology Co. Ltd., Otto Motors, Waymo LLC, Microsoft Corporation, Intel Coroporation, NVIDIA Corporation, BMW AG, International Business Machines Corporation, Harman International Industries Inc., Xilinx Inc., Qualcomm Inc., Tesla Inc., Volvo Car Corporation, Micron Technology Inc., Toyota Motor Corporation, Uber Technologies Inc., Arbe Robotics Ltd., Cerence Inc., Cognata Ltd., Optibus Ltd., Pony. ai Inc., Seeing Machines Ltd., Anduril Industries Inc., Nauto Inc., Veritone Inc., Matterport Inc., Iterative Health LLC, Piaggio Fast Forward Inc., Radar Inc.
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What Is Covered In The Automotive Artificial Intelligence Global Market Report?
•Market Size Forecast: Examine the automotive artificial intelligence market size across key regions, countries, product categories, and applications.
•Segmentation Insights: Identify and classify subsegments within the automotive artificial intelligence market for a structured understanding.
•Key Players Overview: Analyze major players in the automotive artificial intelligence market, including their market value, share, and competitive positioning.
•Growth Trends Exploration: Assess individual growth patterns and future opportunities in the automotive artificial intelligence market.
•Segment Contributions: Evaluate how different segments drive overall growth in the automotive artificial intelligence market.
•Growth Factors: Highlight key drivers and opportunities influencing the expansion of the automotive artificial intelligence market.
•Industry Challenges: Identify potential risks and obstacles affecting the automotive artificial intelligence market.
•Competitive Landscape: Review strategic developments in the automotive artificial intelligence market, including expansions, agreements, and new product launches.
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