Key market driving forces include the development accounts for around 60% market share in software, automotive applications accounting for 17% of the global embedded software market, adoption of ADAS features in vehicles, rapid developments in connected car services, and increasing adoption of semi-autonomous and autonomous vehicles are identified among main market dynamics
Rapid growth in Autonomous vehicles, connected vehicles, shared mobility, and other advancements in the automotive industry is encouraging the market for advanced software development. Leading automakers are emphasizing centralized and embedded software and hardware to boost efficiency.
Automakers are investing in developing their operating systems for vehicles. However, the increasing complexity of automotive software, the emerging need for embedding software across diverse functions, and increasing costs of development, and others act as deterrents for automakers. Further, sustained efforts in Software development and testing are required. In addition, OEMs and tier-1 suppliers are emphasizing the development of customized embedded systems for diverse functions.
The advent of embedded systems is encouraging the use in passenger cars and commercial vehicles across Airbags, ABS, cruise control, satellite radios, parking assistance, in-vehicle infotainment, sensors, navigation systems, climate management, and others.
The shift from mechanical to electronic controls is offering significant opportunities for non-automotive companies to expand into the industry. Accordingly, intense competitive conditions are likely between established automotive tier-1 suppliers with technology giants. Companies that are rapidly developing, validating, and integrating automotive-embedded software are set to gain significant advantages.
Market Driver- Development accounts for around 60% market share in Software
The embedded software market involves the development, validation, and integration phases for automotive functions. Software for different functions including middleware, Operating systems, powertrain, chassis, ADAS, infotainment, and connected services is widely focused.
Technological advancements are encouraging the adoption of embedded systems across low to medium-range vehicles, supporting the overall software market. In addition, investments in customization, diversifying platforms, and other advancements require significant investments in development, verification, and integration.
Of these, software development is estimated to hold the dominant market share of around 60%. Further, the validation and verification account for 30%, and the integration phase accounts for 10% of the market share. However, the share of integration can increase based on the application.
Market Trend- Adoption of ADAS Features in Vehicles
Rapid evolution in the automotive industry owing to consumer preferences, increased emphasis on safety, and environmental regulations are encouraging the demand for driver assistance systems designed to eliminate the human error component when driving vehicles.
Growing demand for safety solutions in low-cost and compact vehicles is supporting the rapid penetration of ADAS components and services. Safety applications including ACC, BSD, NVS, LDWS, FCW, and others to assist drivers with smooth and collision-free driving support are widely marketed. In particular, the demand for NVS and BSD remains strong in the US, Western Europe, and other developed markets. With growing demand from developing countries, these segments are also rapidly increasing steadily in developing markets.
Market Opportunity- Rapid Developments in Connected Car Services
Automotive industry stakeholders are gearing up their investments for connected car services as they provide a unique customer experience. Leading industry participants including automakers, mobility providers, insurance companies, technology providers, dealers, and distributors are aiming to generate significant revenue through the rapid growth in connected car services.
Key market trends include the adoption of advanced communication technologies such as 5G network, Artificial Intelligence, big-data platforms, telematics, and others, increased collaboration between hardware and software components, ride-sharing and mobility services, innovation in OS to drive the connected car market, improvements in safety controls and supportive regulatory framework.
The global Automotive Embedded Software Market is segmented into Types, Applications, and Countries.
RTOS-based Automotive Embedded Software is the dominant market in 2024
The multi-tasking platform enables the execution of other software codes for automotive applications in a predictable execution pattern within a predefined schedule. Efficient RTOS functions include task management and scheduling, deferred interrupt servicing, inter-process communication and synchronization, and memory management.
Leading companies are investing in developing advanced Real-Time Operating System that enables critical features in a car to run with minimal latency. In particular, the advent of autonomous vehicles is promoting the role of hard, soft, and firm RTOS types. Currently, MICROSOFT, LINUX, QNX, and others are extending OS support for automotive applications.
ADAS and AD segment is the fastest-growing type during the forecast period
Amidst strong demand for ADAS systems in vehicles, automakers are incorporating embedded systems with both simple as well as advanced functionalities based on the vehicle type.
The software market growth in the ADAS and AD segment is further driven by the highly complex functionality of the software used in the segment. Further, the software verification process also involves significant costs for ADAS systems in addition to development and integration costs. Amidst increasing labor costs, the cost of ADAS software is also increasing.
The autonomous driving segment is the most promising long-term market driver for both embedded software and hardware providers. To handle real-world situations, both semi-autonomous and autonomous vehicles require foolproof and highly complex software solutions.
Asia Pacific is poised to register 10.94% CAGR growth over the forecast period from 2025 to 2034
Asia Pacific is the largest market for Automotive Embedded Software, predominantly driven by adoption among from the China consumers. China is the largest market in the Asia Pacific region. The government's 14th Five-Year Plan supports the adoption of advanced technologies. Further, the presence of small to medium embedded hardware manufacturing companies presents strong growth scope for the industry. With a quick recovery in the country, the supply chain is stabilized presenting a strong potential for near-term sales.
The automotive production in the country stood at 20 million passenger cars and 5 million commercial vehicles. China benefits from low-cost production facilities and high local demand. Though the domestic market is dominated by small and medium-sized cars, an ongoing drive toward the integration of advanced technologies is observed in the Chinese automotive industry.
The country is characterized by the presence of a wide number of automotive OEMs and Tier I suppliers. Accordingly, companies launching products with low costs but advanced features will have the potential to gain mass-scale opportunities.
By Type
By Application
By Region
Leading companies profiled in the study include-
* List not Exhaustive
Automotive Embedded Software Market Outlook 2023
1 Market Overview
1.1 Introduction to Automotive Embedded Software Market
1.2 Scope of the Study
1.3 Research Objective
1.3.1 Key Market Scope and Segments
1.3.2 Players Covered
1.3.3 Years Considered
2 Executive Summary
2.1 2023 Automotive Embedded Software Industry- Market Statistics
3 Market Dynamics
3.1 Market Drivers
3.2 Market Challenges
3.3 Market Opportunities
3.4 Market Trends
4 Market Factor Analysis
4.1 Porter’s Five Forces
4.2 Market Entropy
4.2.1 Global Automotive Embedded Software Market Companies with Area Served
4.2.2 Products Offerings Global Automotive Embedded Software Market
5 COVID-19 Impact Analysis and Outlook Scenarios
5.1.1 Covid-19 Impact Analysis
5.1.2 Post-COVID-19 Scenario- Low Growth Case
5.1.3 Post-COVID-19 Scenario- Reference Growth Case
5.1.4 Post-COVID-19 Scenario- Low Growth Case
6 Global Automotive Embedded Software Market Trends
6.1 Global Automotive Embedded Software Revenue (USD Million) and CAGR (%) by Type (2018-2028)
6.2 Global Automotive Embedded Software Revenue (USD Million) and CAGR (%) by Applications (2018-2028)
6.3 Global Automotive Embedded Software Revenue (USD Million) and CAGR (%) by Regions (2018-2028)
7 Global Automotive Embedded Software Market Revenue (USD Million) by Type, and Applications (2018-2022)
7.1 Global Automotive Embedded Software Revenue (USD Million) by Type (2018-2022)
7.1.1 Global Automotive Embedded Software Revenue (USD Million), Market Share (%) by Type (2018-2022)
7.2 Global Automotive Embedded Software Revenue (USD Million) by Applications (2018-2022)
7.2.1 Global Automotive Embedded Software Revenue (USD Million), Market Share (%) by Applications (2018-2022)
8 Global Automotive Embedded Software Development Regional Status and Outlook
8.1 Global Automotive Embedded Software Revenue (USD Million) By Regions (2018-2022)
8.2 North America Automotive Embedded Software Revenue (USD Million) by Type, and Application (2018-2022)
8.2.1 North America Automotive Embedded Software Revenue (USD Million) by Country (2018-2022)
8.2.2 North America Automotive Embedded Software Revenue (USD Million) by Type (2018-2022)
8.2.3 North America Automotive Embedded Software Revenue (USD Million) by Applications (2018-2022)
8.3 Europe Automotive Embedded Software Revenue (USD Million), by Type, and Applications (USD Million) (2018-2022)
8.3.1 Europe Automotive Embedded Software Revenue (USD Million), by Country (2018-2022)
8.3.2 Europe Automotive Embedded Software Revenue (USD Million) by Type (2018-2022)
8.3.3 Europe Automotive Embedded Software Revenue (USD Million) by Applications (2018-2022)
8.4 Asia Pacific Automotive Embedded Software Revenue (USD Million), and Revenue (USD Million) by Type, and Applications (2018-2022)
8.4.1 Asia Pacific Automotive Embedded Software Revenue (USD Million) by Country (2018-2022)
8.4.2 Asia Pacific Automotive Embedded Software Revenue (USD Million) by Type (2018-2022)
8.4.3 Asia Pacific Automotive Embedded Software Revenue (USD Million) by Applications (2018-2022)
8.5 South America Automotive Embedded Software Revenue (USD Million), by Type, and Applications (2018-2022)
8.5.1 South America Automotive Embedded Software Revenue (USD Million), by Country (2018-2022)
8.5.2 South America Automotive Embedded Software Revenue (USD Million) by Type (2018-2022)
8.5.3 South America Automotive Embedded Software Revenue (USD Million) by Applications (2018-2022)
8.6 Middle East and Africa Automotive Embedded Software Revenue (USD Million), by Type, Technology, Application, Thickness (2018-2022)
8.6.1 Middle East and Africa Automotive Embedded Software Revenue (USD Million) by Country (2018-2022)
8.6.2 Middle East and Africa Automotive Embedded Software Revenue (USD Million) by Type (2018-2022)
8.6.3 Middle East and Africa Automotive Embedded Software Revenue (USD Million) by Applications (2018-2022)
9 Company Profiles
10 Global Automotive Embedded Software Market Revenue (USD Million), by Type, and Applications (2023-2028)
10.1 Global Automotive Embedded Software Revenue (USD Million) and Market Share (%) by Type (2023-2028)
10.1.1 Global Automotive Embedded Software Revenue (USD Million), and Market Share (%) by Type (2023-2028)
10.2 Global Automotive Embedded Software Revenue (USD Million) and Market Share (%) by Applications (2023-2028)
10.2.1 Global Automotive Embedded Software Revenue (USD Million), and Market Share (%) by Applications (2023-2028)
11 Global Automotive Embedded Software Development Regional Status and Outlook Forecast
11.1 Global Automotive Embedded Software Revenue (USD Million) By Regions (2023-2028)
11.2 North America Automotive Embedded Software Revenue (USD Million) by Type, and Applications (2023-2028)
11.2.1 North America Automotive Embedded Software Revenue (USD) Million by Country (2023-2028)
11.2.2 North America Automotive Embedded Software Revenue (USD Million), by Type (2023-2028)
11.2.3 North America Automotive Embedded Software Revenue (USD Million), Market Share (%) by Applications (2023-2028)
11.3 Europe Automotive Embedded Software Revenue (USD Million), by Type, and Applications (2023-2028)
11.3.1 Europe Automotive Embedded Software Revenue (USD Million), by Country (2023-2028)
11.3.2 Europe Automotive Embedded Software Revenue (USD Million), by Type (2023-2028)
11.3.3 Europe Automotive Embedded Software Revenue (USD Million), by Applications (2023-2028)
11.4 Asia Pacific Automotive Embedded Software Revenue (USD Million) by Type, and Applications (2023-2028)
11.4.1 Asia Pacific Automotive Embedded Software Revenue (USD Million), by Country (2023-2028)
11.4.2 Asia Pacific Automotive Embedded Software Revenue (USD Million), by Type (2023-2028)
11.4.3 Asia Pacific Automotive Embedded Software Revenue (USD Million), by Applications (2023-2028)
11.5 South America Automotive Embedded Software Revenue (USD Million), by Type, and Applications (2023-2028)
11.5.1 South America Automotive Embedded Software Revenue (USD Million), by Country (2023-2028)
11.5.2 South America Automotive Embedded Software Revenue (USD Million), by Type (2023-2028)
11.5.3 South America Automotive Embedded Software Revenue (USD Million), by Applications (2023-2028)
11.6 Middle East and Africa Automotive Embedded Software Revenue (USD Million), by Type, and Applications (2023-2028)
11.6.1 Middle East and Africa Automotive Embedded Software Revenue (USD Million), by Region (2023-2028)
11.6.2 Middle East and Africa Automotive Embedded Software Revenue (USD Million), by Type (2023-2028)
11.6.3 Middle East and Africa Automotive Embedded Software Revenue (USD Million), by Applications (2023-2028)
12 Methodology and Data Sources
12.1 Methodology/Research Approach
12.1.1 Research Programs/Design
12.1.2 Market Size Estimation
12.1.3 Market Breakdown and Data Triangulation
12.2 Data Sources
12.2.1 Secondary Sources
12.2.2 Primary Sources
12.3 Disclaimer
List Of Tables
Table 1 Market Segmentation Analysis
Table 2 Global Automotive Embedded Software Market Companies with Areas Served
Table 3 Products Offerings Global Automotive Embedded Software Market
Table 4 Low Growth Scenario Forecasts
Table 5 Reference Case Growth Scenario
Table 6 High Growth Case Scenario
Table 7 Global Automotive Embedded Software Revenue (USD Million) And CAGR (%) By Type (2018-2028)
Table 8 Global Automotive Embedded Software Revenue (USD Million) And CAGR (%) By Applications (2018-2028)
Table 9 Global Automotive Embedded Software Revenue (USD Million) And CAGR (%) By Regions (2018-2028)
Table 10 Global Automotive Embedded Software Revenue (USD Million) By Type (2018-2022)
Table 11 Global Automotive Embedded Software Revenue Market Share (%) By Type (2018-2022)
Table 12 Global Automotive Embedded Software Revenue (USD Million) By Applications (2018-2022)
Table 13 Global Automotive Embedded Software Revenue Market Share (%) By Applications (2018-2022)
Table 14 Global Automotive Embedded Software Market Revenue (USD Million) By Regions (2018-2022)
Table 15 Global Automotive Embedded Software Market Share (%) By Regions (2018-2022)
Table 16 North America Automotive Embedded Software Revenue (USD Million) By Country (2018-2022)
Table 17 North America Automotive Embedded Software Revenue (USD Million) By Type (2018-2022)
Table 18 North America Automotive Embedded Software Revenue (USD Million) By Applications (2018-2022)
Table 19 Europe Automotive Embedded Software Revenue (USD Million) By Country (2018-2022)
Table 20 Europe Automotive Embedded Software Revenue (USD Million) By Type (2018-2022)
Table 21 Europe Automotive Embedded Software Revenue (USD Million) By Applications (2018-2022)
Table 22 Asia Pacific Automotive Embedded Software Revenue (USD Million) By Country (2018-2022)
Table 23 Asia Pacific Automotive Embedded Software Revenue (USD Million) By Type (2018-2022)
Table 24 Asia Pacific Automotive Embedded Software Revenue (USD Million) By Applications (2018-2022)
Table 25 South America Automotive Embedded Software Revenue (USD Million) By Country (2018-2022)
Table 26 South America Automotive Embedded Software Revenue (USD Million) By Type (2018-2022)
Table 27 South America Automotive Embedded Software Revenue (USD Million) By Applications (2018-2022)
Table 28 Middle East and Africa Automotive Embedded Software Revenue (USD Million) By Region (2018-2022)
Table 29 Middle East and Africa Automotive Embedded Software Revenue (USD Million) By Type (2018-2022)
Table 30 Middle East and Africa Automotive Embedded Software Revenue (USD Million) By Applications (2018-2022)
Table 31 Financial Analysis
Table 32 Global Automotive Embedded Software Revenue (USD Million) By Type (2023-2028)
Table 33 Global Automotive Embedded Software Revenue Market Share (%) By Type (2023-2028)
Table 34 Global Automotive Embedded Software Revenue (USD Million) By Applications (2023-2028)
Table 35 Global Automotive Embedded Software Revenue Market Share (%) By Applications (2023-2028)
Table 36 Global Automotive Embedded Software Market Revenue (USD Million), And Revenue (USD Million) By Regions (2023-2028)
Table 37 North America Automotive Embedded Software Revenue (USD)By Country (2023-2028)
Table 38 North America Automotive Embedded Software Revenue (USD Million) By Type (2023-2028)
Table 39 North America Automotive Embedded Software Revenue (USD Million) By Applications (2023-2028)
Table 40 Europe Automotive Embedded Software Revenue (USD Million) By Country (2023-2028)
Table 41 Europe Automotive Embedded Software Revenue (USD Million) By Type (2023-2028)
Table 42 Europe Automotive Embedded Software Revenue (USD Million) By Applications (2023-2028)
Table 43 Asia Pacific Automotive Embedded Software Revenue (USD Million) By Country (2023-2028)
Table 44 Asia Pacific Automotive Embedded Software Revenue (USD Million) By Type (2023-2028)
Table 45 Asia Pacific Automotive Embedded Software Revenue (USD Million) By Applications (2023-2028)
Table 46 South America Automotive Embedded Software Revenue (USD Million) By Country (2023-2028)
Table 47 South America Automotive Embedded Software Revenue (USD Million) By Type (2023-2028)
Table 48 South America Automotive Embedded Software Revenue (USD Million) By Applications (2023-2028)
Table 49 Middle East and Africa Automotive Embedded Software Revenue (USD Million) By Region (2023-2028)
Table 50 Middle East and Africa Automotive Embedded Software Revenue (USD Million) By Region (2023-2028)
Table 51 Middle East and Africa Automotive Embedded Software Revenue (USD Million) By Type (2023-2028)
Table 52 Middle East and Africa Automotive Embedded Software Revenue (USD Million) By Applications (2023-2028)
Table 53 Research Programs/Design for This Report
Table 54 Key Data Information from Secondary Sources
Table 55 Key Data Information from Primary Sources
List Of Figures
Figure 1 Market Scope
Figure 2 Porter’s Five Forces
Figure 3 Global Automotive Embedded Software Revenue (USD Million) By Type (2018-2022)
Figure 4 Global Automotive Embedded Software Revenue Market Share (%) By Type (2022)
Figure 5 Global Automotive Embedded Software Revenue (USD Million) By Applications (2018-2022)
Figure 6 Global Automotive Embedded Software Revenue Market Share (%) By Applications (2022)
Figure 7 Global Automotive Embedded Software Market Revenue (USD Million) By Regions (2018-2022)
Figure 8 Global Automotive Embedded Software Market Share (%) By Regions (2022)
Figure 9 North America Automotive Embedded Software Revenue (USD Million) By Country (2018-2022)
Figure 10 North America Automotive Embedded Software Revenue (USD Million) By Type (2018-2022)
Figure 11 North America Automotive Embedded Software Revenue (USD Million) By Applications (2018-2022)
Figure 12 Europe Automotive Embedded Software Revenue (USD Million) By Country (2018-2022)
Figure 13 Europe Automotive Embedded Software Revenue (USD Million) By Type (2018-2022)
Figure 14 Europe Automotive Embedded Software Revenue (USD Million) By Applications (2018-2022)
Figure 15 Asia Pacific Automotive Embedded Software Revenue (USD Million) By Country (2018-2022)
Figure 16 Asia Pacific Automotive Embedded Software Revenue (USD Million) By Type (2018-2022)
Figure 17 Asia Pacific Automotive Embedded Software Revenue (USD Million) By Applications (2018-2022)
Figure 18 South America Automotive Embedded Software Revenue (USD Million) By Country (2018-2022)
Figure 19 South America Automotive Embedded Software Revenue (USD Million) By Type (2018-2022)
Figure 20 South America Automotive Embedded Software Revenue (USD Million) By Applications (2018-2022)
Figure 21 Middle East and Africa Automotive Embedded Software Revenue (USD Million) By Region (2018-2022)
Figure 22 Middle East and Africa Automotive Embedded Software Revenue (USD Million) By Type (2018-2022)
Figure 23 Middle East and Africa Automotive Embedded Software Revenue (USD Million) By Applications (2018-2022)
Figure 24 Global Automotive Embedded Software Revenue (USD Million) By Type (2023-2028)
Figure 25 Global Automotive Embedded Software Revenue Market Share (%) By Type (2028)
Figure 26 Global Automotive Embedded Software Revenue (USD Million) By Applications (2023-2028)
Figure 27 Global Automotive Embedded Software Revenue Market Share (%) By Applications (2028)
Figure 28 Global Automotive Embedded Software Market Revenue (USD Million) By Regions (2023-2028)
Figure 29 North America Automotive Embedded Software Revenue (USD Million) By Country (2023-2028)
Figure 30 North America Automotive Embedded Software Revenue (USD Million) By Type (2023-2028)
Figure 31 North America Automotive Embedded Software Revenue (USD Million) By Applications (2023-2028)
Figure 32 Europe Automotive Embedded Software Revenue (USD Million) By Country (2023-2028)
Figure 33 Europe Automotive Embedded Software Revenue (USD Million) By Type (2023-2028)
Figure 34 Europe Automotive Embedded Software Revenue (USD Million) By Applications (2023-2028)
Figure 35 Asia Pacific Automotive Embedded Software Revenue (USD Million) By Country (2023-2028)
Figure 36 Asia Pacific Automotive Embedded Software Revenue (USD Million) By Type (2023-2028)
Figure 37 Asia Pacific Automotive Embedded Software Revenue (USD Million) By Applications (2023-2028)
Figure 38 South America Automotive Embedded Software Revenue (USD Million) By Country (2023-2028)
Figure 39 South America Automotive Embedded Software Revenue (USD Million) By Type (2023-2028)
Figure 40 South America Automotive Embedded Software Revenue (USD Million) By Applications (2023-2028)
Figure 41 Middle East and Africa Automotive Embedded Software Revenue (USD Million) By Region (2023-2028)
Figure 42 Middle East and Africa Automotive Embedded Software Revenue (USD Million) By Region (2023-2028)
Figure 43 Middle East and Africa Automotive Embedded Software Revenue (USD Million) By Type (2023-2028)
Figure 44 Middle East and Africa Automotive Embedded Software Revenue (USD Million) By Applications (2023-2028)
Figure 45 Bottom-Up and Top-Down Approaches For This Report
Figure 46 Data Triangulation
The Global Automotive Embedded Software market Size is estimated at $7.3 Billion in 2025 and is forecast to register an annual growth rate (CAGR) of 7.6% to reach $14.1 Billion by 2034.
Emerging Markets across Asia Pacific, Europe, and Americas present robust growth prospects.
NXP Semiconductors, STMicroelectronics NV, Intel Corp, Mitsubishi Electric Corp, Microsoft Corp, Green Hills Software, Mentor Graphics, Denso, AdvanTech Inc, Apple Inc.
Base Year- 2024; Estimated Year- 2025; Historic Period- 2019-2024; Forecast period- 2025 to 2034; Currency: Revenue (USD); Volume