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Surging Demand for Connected Cars: A 28% Sales Jump in Q3 2023
Published: 1.30.2024
The future of driving is connected, and the present is reflecting that trend.
According to market research firm Counterpoint, global connected car sales saw a significant jump of 28% year-over-year in Q3 2023. This indicates a growing appetite for vehicles equipped with internet connectivity, unlocking features like navigation, remote diagnostics, and even self-driving capabilities.
Geographically, the connected car market is dominated by three regions: China, the United States, and Europe. Together, they captured a commanding 75% share of global sales. China led the pack with a 33% share, followed by the U.S. and Europe neck-and-neck.
Soumen Mandal, a Senior Analyst at Counterpoint Research, remarked that with the rising adoption of electric vehicles and autonomous cars, the connectivity penetration within automobiles is on the rise.
The current dominance in this space is held by 4G, accounting for over 95% of sales share, while the adoption of 5G lags behind earlier industry projections. Reasons for the slower adoption of 5G in passenger cars include the lack of robust infrastructure along highways, the absence of unique 5G use cases within the cars, and challenges within the supply chain.
In the analysis of the market outlook, Neil Shah, Vice President of Research, observed that the inclination toward connectivity in cars is steadily growing, even in developing economies, establishing itself as a crucial distinguishing factor in the market.
The expectation is that by 2030, embedded connectivity will be a feature in over 95% of all new passenger cars. The prevalence of 4G connectivity is foreseen to endure, while the incorporation of 5G connectivity is poised for a gradual uptick, especially with the introduction of more L3 and above cars into the market.
The year 2026 is anticipated to mark a turning point for the adoption of 5G in automotive applications. By 2030, it is predicted that over 90% of connected cars sold will be equipped with embedded 5G connectivity.
