The global 5G in automotive and smart transportation Market size had a share of USD 1.40 billion in 2021, which is expected to advance and reach USD 10.97 billion with a CAGR of 25.7% during the forecast period.
With the move toward 5G, massive Machine Type Communications (mMTC) will enable towns, transport, and networks to rely on real-time data for improving maintenance and operational performance. Enhancing vehicles with 5G technology will revolutionize transportation. Vehicle-to-vehicle and vehicle-to-infrastructure connectivity are projected to make roads safer and environment-friendly, improving bus and public transit. Further, new networks and business models enabled with sensors installed on highways, rail, and airfields connect with smart vehicles.
|Market Size||USD 10.97 billion|
|Fastest Growing Market||Europe|
|Largest Market||North America|
|Report Coverage||Revenue Forecast, Competitive Landscape, Growth Factors, Environment & Regulatory Landscape and Trends|
Intelligent transport includes applying sensing, measurement, control, and communication systems to ground transportation to increase safety, accessibility, and performance. Intelligent Transport System (ITS) depends on data generated by car sensors and road networks to help drivers, and cities make intelligent choices. Globally, increasing number of cities are using ITS to address numerous local challenges, such as traffic congestion and parking violations. Countries in both the EU and Asia are now observing ITS being deployed and incorporated.
According to ‘Mobilizing Intelligent Transport Systems (ITS)’, published by the GSM Association, the global intelligent transport was valued at 67 billion in 2015. Further, these intelligent transport systems when connected to the 5G network are anticipated to deliver a plethora of benefits for Smart Cities, Autonomous Vehicles, Traffic Management Systems, Emergency Services, and Future-Proof Infrastructures. Further, the European Commission asserts that introducing such technologies to road transport would lead to a 5-15% reduction in congestion, casualties, traffic collisions, and a 10-20% decrease in CO2 emissions.
The proliferation of advanced technology in the automotive sector has enabled the development of autonomous systems. As per the Society Of Automotive Engineers (SAE) International, established its SAE J3016™ ‘Levels of Automated Driving‘. They have categorized it into different levels :
From level 1 onwards, there is a tremendous need for deploying high-tech devices such as sensors and cameras that assist the driver. Further, the capabilities of self-driving cars will improve considerably with the introduction of 5G autonomous driving system. Additionally, global telecommunications providers are diligently partnering with LTE technology to bring 5G autonomous driving innovations into real-world operation, bridging the transition to mass implementation of 5G cellular vehicle-to-all (C-V2X).
While using smart transportation, the mechanism solely depends on internet service connectivity. The waves are transmitted from the hubs to the vehicles enabling them to perform various functions. However, technological developments have raised new possibilities for cybercrimes.
In the 2IBM X-Force review (the year 2016), the automotive industry was targeted mostly. Approximately 30% of the share included attacks by phishing, extorted by ransomware, and breached by APT’s in the manufacturing industry.
North American leads the 5G automotive and smart transportation market. It has the largest market share due to the favorable technological infrastructure, with the increased participation of leading automotive and telecom companies along with the growing purchasing power parity (PPP) of the people.
Besides, the increase in the number of connected vehicles and the growth of internet penetration has flooded the automotive sector. According to GSMA Mobile Economy North America 2020, by the end of 2025, the region is anticipated to transit to approximately 48% of the 5G connections. The report also stated that the Internet of Things connections are anticipated to reach 5.1 billion by the end of 2025.
The European region is accounted as one of the largest markets for the automotive industry. As stated by the European Commission, the sector provides more than 13.8 million direct and indirect jobs that are approximately 6.1% of total employment. Additionally, as stated by the International Organization of Motor Vehicle Manufacturers, the region is the second-largest producer of vehicles.
Further, in recent years, the automotive industry has been booming in the area of Central and Eastern Europe (CEE). Increased numbers of carmakers plan to set up their new and state-of-the-art manufacturing sites in CEE countries due to the economic advantage over Western European countries. As a result of increased political consolidation and economic growth, the Europe has gained increased interest from investors, seeing it as one shared-source, manufacturing, and logistics hub. Further, the increase in the technology adoption, and the presence of major automotive and telecom companies have bolstered the growth of the market.
The hardware components cater to the maximum share in the market owing to the deployment of various hardware components such as Telematics Control Units (TCUs), Roadside Units (RSUs), and Onboard Units (OBUs).
Further, by presenting alarms, providing notifications, offering automobile resources, and managing contact with the world of a car, the On-Board Device (OBU) is built into a vehicle for interaction with other drivers. OBU may help mitigate driver misjudgment with features like, stop traffic collisions and map out the successful driving path. The tremendous application of the OBUs across various industry verticals have bolstered the growth of the market.
The automotive segment caters to a larger share of the market. The continuous evolution of the existing vehicles with new technology and multiple benefits offered by the 5G networks has bolstered the market growth.
Further, as stated by the 5G Automotive Association, Cellular-V2X (C-V2X) revolutionizes the mobility ecosystems and enables efficient communication of the driver to the outside world. Further, the start of in-vehicle commercial deployment (type-approved vehicles) is foreseen for 2020/2021 globally, thereby bolstering the growth of the segment.
The pandemic led to a temporary lockdown that hindered big enterprise and market verticals. The automobile industry, primarily consisting of outdoor jobs, was poorly exposed to the uncertainty that contributed to a dramatic decline in automotive sales.
Furthermore, the instability of the supply chain industry, mostly due to closed national and foreign borders and the decision not to use Chinese products, may impede the operation. However, the new norm of social distancing may have a slight impact on the market growth.