SEOUL, South Korea and HONG KONG and NEW DELHI and BEIJING and LONDON and BUENOS AIRES, Argentina and SAN DIEGO, June 26, 2019 /PRNewswire/ — Revenues from connected cars globally are projected to grow five-fold, reaching over US$24 billion by 2025, the latest research by Counterpoint’s Smart Automotive Service shows.
For this study, a connected car is defined as a passenger car, having an embedded SIM card for internet connection, with proprietary Telematics Control Unit (TCU) hardware managing data exchanges. The study further categorizes potential OEM revenues by services offered and the originally installed hardware equipment. Connected services include advanced navigation, infotainment subscribed by the driver, as well as emergency assistance and diagnostics alerts as value added, and in some cases, mandated services.
Commenting on the analysis, Aman Madhok, Senior Analyst at Counterpoint Research said, “Deep technology applications, specifically, smartphones and notepads, in daily life has created expectations for seamless ‘on-the-go’ technology accessibility in cars, especially among emerging millennial car buyers. Connected cars are gaining preference and going mainstream, with the rising awareness of their enhanced overall comfort, safety, and convenience while driving.”
The Counterpoint Research study reveals that more than 286 million connected passenger cars will be added globally during the 2019-2025 period. US and Europe together accounted for the most connected car shipments in 2018. However, during the forecast period, China is expected to account for more than 35% of connected car shipments.
Vinay Piparsania, Consulting Director at Counterpoint Research, added, “With more countries adopting their own versions of Europe’s eCall, automotive OEMs are taking the opportunity to install original and proprietary embedded telematics systems, opening up significant revenue opportunities to offer connected and subscription-based services globally. By incorporating innovative smart connected features, OEMs are looking to differentiate their models.”
Cautioning on the challenges for automakers, Vinay added, “Digital features in cars today are expensive and complex. OEMs need to step up their game to provide in-car experiences which are as seamless and intuitive as smartphones. This explains why OEMs are collaborating and even investing in software companies.”
Source: Counterpoint Research
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