The global automotive cybersecurity market size is projected to grow from USD 2.5 billion in 2023 to USD 6.0 billion by 2028, at a CAGR of 18.5%. Increasing adoption of connected vehicles has in turn increased the electronic content per vehicle. This has eventually raised the vulnerability of a vehicle against a cyber-attack, which resulted in recall of vehicles by the reputaed automakers in the recent past. Thereby, the demand for automotive cybersecurity solutions are growing at a rapid pace all over the world. Moreover, advent of software-defined vehicles in conjunction with growing cloud-based applications in automotive sector are also expected to create lucrative opportunities for the automotive cybersecurity market in the coming years globally.
Automotive Cybersecurity Market Dynamics:
Driver: Electric vehicles more vulnerable to cyber attacks
Electric vehicles are equipped with advanced connected vehicle technology, which allows EVs to communicate with other vehicles, infrastructure, and various online services. This connectivity increases the vulnerability of vehicles to cyber threats. As EV sales rise, the need for robust cybersecurity solutions will become even more critical to protect these connected systems from potential attacks. As such, the global sales of EVs increased by 55% in 2022 to 10.5 million units from the previous year. China led the way with an 82% growth in new energy vehicle (NEV) sales, and BYD became the global sales leader.
The demand for automotive cybersecurity is likely to grow along with the growing demand for electric vehicles. Moreover, with reputed automakers such as BMW, General Motors, Volvo, Daimler, Stellantis, Toyota, and Volkswagen planning to either partially or completely phase out the production of ICE-powered vehicles by 2030, the demand for electric vehicles is expected to increase in turn, driving the demand for automotive cybersecurity solutions globally.
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Opportunity: Advent of software-defined vehicles
The automotive sector has started shifting its focus toward software-centric vehicles. The features and functions of these vehicles are primarily enabled through automotive software. Today, most premium vehicles have up to 150 million lines of software codes, which are typically proportionate among hundreds of electronic control units (ECUs) and a rising number of cameras, RADAR, and light detection and ranging (LiDAR) devices, among others.
Software-defined vehicles have several advantages. For instance, software upgrades pertaining to vehicle infotainment systems, telematics, vehicle diagnostic systems, and others will require a trip to the dealership. However, with software-defined vehicles, customers will be able to receive over-the-air (OTA) updates that cover infotainment improvements, security patches, and the monitoring & tuning of core functionalities, such as powertrain and vehicle dynamics. This will increase the demand for software-defined vehicles, in turn creating growth opportunities for the automotive cybersecurity market during the forecast period.
Passenger vehicle segment is expected to have largest share in the global automotive cybersecurity market
The passenger vehicles segment is anticipated to dominate the global automotive cybersecurity market in the foreseeable future. This is owing to the rising demand for connected vehicle technology paired with the increasing sales of luxury vehicles. Also, the increasing focus towards V2X technology owing to the rising concerns over traffic, safety, as well as pollution levels is anticipated to bolster revenue growth for the passenger vehicles segment of the global automotive cybersecurity market. For instance, Audi A4 and Cadillac CTS are passenger vehicles that are equipped with V2X technology. Moreover, the rising adoption of ADAS equipped passenger vehicles is also another major factor creating the need for automotive cybersecurity solutions gobally.
Endpoint security segment is expected to have significant growth opportunities in global automotive cybesecurity market
The endpoint security segment is anticipated to have significant growth opportunities in Europe and Asia Pacific during the forecast period. Rising concerns pertaining to the safety and security in Europe and Asia Pacific regions are also likely to increase the demand for endpoint security solutions. New vehicles launched in the global market contain around 100 million lines of code and are typically deployed with complex software by automotive manufacturers/OEMs. Automotive OEMs are opting for endpoint security solutions in order to maintain the safety as well as security of a vehicle’s entire code base. All these aforementioned factors are expected to augment revenues for endpoint security segment of the automotive cybersecurity market in the foreseeable future.
“The Asia pacific automotive cybersecurity market is projected to hold the largest share by 2028.”
Asia Pacific is estimated to account for the largest market share in 2023, followed by Europe and North America. Countries such as China, India, Japan, South Korea, and the Rest of Asia Pacific are considered under Asia Pacific for market analysis. One of the key factors driving the market growth in this region is the large production of passenger vehicles, coupled with the increasing penetration of connected cars and other advanced technologies. China and India are considered manufacturing hubs for the automotive industry. . In addition, the increasing purchasing power of the population and rising concerns over vehicle pollution have triggered the demand for electric vehicles and semi-autonomous vehicles in Asia Pacific. This in turn would also drive the market growth for automotive cybersecurity.
Key Market Players:
The automotive cybersecurity market is dominated by global players such as Robert Bosch GmbH (Germany), Continental AG (Germany), Harman International (US), DENSO Corporation (Japan), and Aptiv PLC (Ireland), among others.
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