Global Automotive TIC Market, By Service Type (Testing Services, Inspection Services, Certification Services), Application and Propulsion (Automotive Interior/Exterior Bodies, Electrical Systems and Components, Vehicle Inspection Services, Telematics and Connectivity, Fuels, Fluids, and Lubricants, Homologation, EV Batteries, EV Motors, EV Chargers, ADAS and Safety Systems), Sourcing Type (In-House, Outsourced), Vehicle Type (Passenger Cars, Commercial Vehicles), and Region — Industry Analysis and Forecast to 2030
The global automotive TIC market is expected to grow from USD 18.12 billion in 2023 to USD 23.49 billion by 2030 at a CAGR of 3.8%. The market are driven by the growing consumer demand for advanced vehicle features. Integration of telematics systems, infotainment options, and connectivity solutions enhances driving experiences. Factors like increased focus on safety, rising demand for connected cars, and the evolution of autonomous driving contribute to the expanding automotive TIC market.
Figure 1: Global Automotive TIC Market Size, 2023-2030 (USD Billion)
Source: Secondary Research, Expert Interviews, and MAARECO Analysis
Automotive Telematics, Infotainment, and Connectivity (TIC) refer to an integrated system in vehicles that combines telematics technologies, infotainment features, and connectivity solutions. Telematics involves the transmission of data for purposes such as vehicle tracking, diagnostics, and navigation. Infotainment includes in-car entertainment and information services, while connectivity enables communication between the vehicle and external networks. This holistic approach enhances the driving experience by providing real-time information, entertainment options, and connectivity features. Automotive TIC systems contribute to safety, efficiency, and convenience, reflecting the industry’s evolution toward intelligent and connected vehicles with advanced functionalities.
Automotive TIC Market Drivers
Increasing Focus on Vehicle Safety
One significant driver propelling the automotive Telematics, Infotainment, and Connectivity (TIC) market is the heightened emphasis on vehicle safety. Governments worldwide are implementing stringent safety regulations, and consumers are increasingly prioritizing safety features in their vehicles. Telematics plays a crucial role in enhancing safety by providing real-time data on vehicle performance, monitoring driver behavior, and enabling emergency services. According to the National Highway Traffic Safety Administration (NHTSA) in the United States, the adoption of vehicle-to-everything (V2X) communication, a key component of telematics, has the potential to prevent up to 80% of non-impaired crashes.
Growing Demand for Connected Cars
The growing consumer demand for connected cars is a major driver fueling the automotive TIC market. Modern consumers seek seamless connectivity, entertainment, and advanced infotainment options in their vehicles. The International Telecommunication Union (ITU) estimates that by 2025, there will be approximately 1.4 billion connected cars globally. The integration of connectivity features, such as in-car Wi-Fi, navigation services, and smartphone integration, is becoming a standard expectation. This surge in demand is driven by the desire for a more enjoyable and connected driving experience. As a result, automakers are increasingly incorporating advanced TIC systems into their vehicles to meet consumer expectations and stay competitive in the evolving automotive landscape.
Automotive TIC Market Restraints
Data Security and Privacy Concerns
A significant restraint facing the automotive Telematics, Infotainment, and Connectivity (TIC) market revolves around data security and privacy concerns. As vehicles become more connected, the amount of sensitive data generated and transmitted increases, raising apprehensions about potential cyber threats and unauthorized access. Instances of data breaches in the automotive sector can compromise personal information, vehicle performance data, and even impact safety. The U.S. Federal Trade Commission (FTC) reported a rise in automotive-related privacy and security complaints, highlighting the need for robust measures to safeguard consumer data. Addressing these concerns is crucial to fostering consumer trust and ensuring the continued adoption of TIC technologies.
High Initial Costs and Complexity
The high initial costs associated with implementing advanced TIC systems pose a significant restraint to their widespread adoption. Integrating telematics, infotainment, and connectivity features requires substantial investments in both hardware and software components. The European Automobile Manufacturers’ Association (ACEA) notes that the cost of incorporating connected car technologies is a critical consideration for automakers. Additionally, the complexity of these systems can contribute to higher maintenance costs and increased difficulty in repairs. This poses a challenge for manufacturers in offering affordable connected vehicles to a broader consumer base. Striking a balance between providing cutting-edge TIC functionalities and managing the associated costs remains a key challenge for the automotive industry as it navigates the transition to increasingly connected and intelligent vehicles.
Automotive TIC Market Opportunities
Integration of Artificial Intelligence (AI) and Machine Learning
An emerging opportunity in the automotive Telematics, Infotainment, and Connectivity (TIC) market is the integration of Artificial Intelligence (AI) and Machine Learning (ML) technologies. AI-powered TIC systems can enhance predictive maintenance capabilities, optimize route planning, and personalize infotainment services based on user preferences. The International Data Corporation (IDC) forecasts that spending on AI in the automotive industry will reach $7.3 billion globally by 2023. The incorporation of AI and ML in TIC not only improves the efficiency of vehicle operations but also opens avenues for innovative applications such as intelligent voice assistants and contextual recommendations, creating a more immersive and personalized driving experience.
Growth of the Subscription-based Model
The adoption of a subscription-based model for TIC services represents a significant opportunity in the automotive market. Rather than a one-time purchase, consumers can subscribe to specific telematics, infotainment, or connectivity services, allowing for continuous updates and enhancements. This model offers flexibility, enabling users to choose and pay for the services they require. According to Deloitte, the subscription-based business model in the automotive industry is gaining traction, with potential benefits such as recurring revenue streams and improved customer loyalty. Automakers can capitalize on this trend by offering innovative and valuable TIC services through subscription plans, aligning with changing consumer preferences and generating long-term revenue in an evolving automotive landscape.
Automotive TIC Market Challenges
Standardization and Interoperability Issues
A notable challenge facing the automotive Telematics, Infotainment, and Connectivity (TIC) market is the lack of standardized protocols and interoperability among various TIC systems. The absence of universal standards can hinder seamless communication between different components and devices within the automotive ecosystem. The Society of Automotive Engineers (SAE) notes the importance of developing standardized protocols to ensure interoperability and facilitate the integration of diverse TIC functionalities. The absence of standardization not only complicates the development and implementation process but also limits the potential for collaborative innovations across the automotive industry. Addressing this challenge requires concerted efforts from industry stakeholders to establish common standards that promote compatibility and interoperability, fostering a more cohesive and interconnected TIC ecosystem.
Infrastructure Limitations for Connectivity
A significant challenge in the automotive TIC market pertains to limitations in the existing infrastructure for connectivity, particularly in less developed regions. The success of connected vehicle technologies relies heavily on robust and widespread network coverage. The International Telecommunication Union (ITU) emphasizes the need for improved communication infrastructure to support the growing demand for connected vehicles. In regions with inadequate network coverage, issues such as signal dropouts, slow data transfer rates, and unreliable connectivity can impede the effectiveness of TIC systems. Overcoming this challenge requires substantial investments in expanding and upgrading communication networks to provide reliable and high-speed connectivity, ensuring that the full potential of TIC technologies can be realized globally, regardless of geographic location or economic development disparities.
Regional Trends
North America: In North America, the trends in the automotive TIC market were likely influenced by a strong consumer demand for advanced connectivity and infotainment features. The adoption of connected cars and increasing investments in autonomous driving technologies were shaping the market. Government initiatives focusing on smart transportation and regulatory support for vehicle safety technologies may have further influenced the TIC trends in this region.
Europe: Europe has traditionally been at the forefront of adopting advanced automotive technologies. The trends in the European automotive TIC market may be driven by the European Union’s emphasis on vehicle safety standards, environmental sustainability, and the development of intelligent transportation systems. The integration of TIC features aligns with the region’s commitment to enhancing road safety and achieving more sustainable mobility.
Asia Pacific: The Asia Pacific region, home to major automotive markets, was likely experiencing a surge in the adoption of TIC technologies. The trends might be influenced by the rapid expansion of the electric vehicle market, especially in countries like China. The growing middle class and increasing urbanization in the region may have contributed to a higher demand for connected cars and advanced TIC features.
Middle East and Africa: In the Middle East and Africa, the automotive TIC market trends might be shaped by factors such as infrastructure development, economic growth, and government initiatives for smart cities. The adoption of TIC technologies could be part of the region’s efforts to modernize transportation infrastructure and enhance overall connectivity.
Latin America: Latin America’s automotive TIC market could be influenced by economic conditions, government policies, and the regional automotive landscape. The trends might include a focus on affordability, given the economic considerations in some countries, and a growing interest in advanced TIC features as the automotive market evolves.
Key Players
Key players operating in the global automotive TIC market are Dekra SE, Applus+, TÜV SÜD, SGS SA, TÜV NORD GROUP, TÜV Rheinland AG Group, Intertek, Bureau Veritas S.A., Eurofins, Kiwa NV, Element Materials, British Standards Institution (BSI), Rina S.p.A., Engineering Quality Solutions, Inc. (EQS), Norges Elektriske Materiellkontroll (NEMKO), NSF, and Mistras.
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