Artificial intelligence has wide applications in the automotive industry including autonomous driving, advanced driver-assistance systems, infotainment, prognostics, manufacturing and more. AI systems help improve safety by enabling features such as advanced driver assistance, lane keeping, automated braking, collision warnings and prevention. They also enhance comfort with features such as virtual assistants and intelligent navigation.
Market Opportunity:
The opportunity of developing self-driving cars is driving the growth of the artificial intelligence in automotive market. AI has the potential to make autonomous vehicles a mainstream mode of transportation in the near future. With automakers investing huge capital in AI and driverless car research, self-driving vehicles are expected to hit the roads in large numbers over the coming decade. AI capabilities such as machine learning, computer vision and predictive algorithms are enabling accurate detection of road objects and obstacles as well as navigation without human intervention. As AI and 5G technologies continue to advance, fully autonomous vehicles without steering wheels or pedals are likely to become commercially viable options, offering increased mobility and road safety. This presents a huge opportunity for automakers and AI companies to tap into the lucrative self-driving car market in the long run.
Porter's Analysis
Threat of new entrants: The artificial intelligence in automotive market has moderate threat of new entrants due to high capital requirements and established presence of major players.
Bargaining power of buyers: Individual buyers have low bargaining power due to availability of alternatives, whereas OEMs have moderate bargaining power due to their volume purchases.
Bargaining power of suppliers: Major AI and tech companies supplying core technologies have high bargaining power due to differentiated offerings and intellectual property.
Threat of new substitutes: Threat of substitutes is low as AI systems are continually making automotive industry processes more efficient.
Competitive rivalry: Intense due to presence of major global players continuously investing in AI research and growth strategies.
SWOT Analysis
Strengths: Ability to enhance safety, transform mobility, and improve user experience. Automakers focus on AI integration.
Weaknesses: High R&D costs, data privacy and security challenges, shortage of AI talent. Technological limitations and prone to errors.
Opportunities: Scope for advancement in autonomous driving, predictive maintenance, in-cabin personalization, and smart infrastructure.
Threats: Stringent regulations, dependence on key AI players, decline in sales due to economic slowdown. Vulnerability to cyber threats.
Key Takeaways
The Global Artificial Intelligence in Automotive Market Growth is expected to witness high during the forecast period driven by advancements in deep learning and machine learning techniques, increasing vehicle production, and focus on autonomous driving technologies. The global Artificial Intelligence in Automotive Market is estimated to be valued at US$ 9.3 Bn in 2023 and is expected to exhibit a CAGR of 12% over the forecast period 2023 to 2030.
The Asia Pacific region dominates the market currently due to high vehicle production in China, Japan, and India. Government initiatives for smart transportation and presence of leading automakers give the region an edge. North America is expected to grow at a significant rate due to investments by major tech players into self-driving technologies in the US and Canada.
Key players operating in the artificial intelligence in automotive market are BMW AG, AUDI AG, Intel Corporation, Tesla Inc, Uber Technologies, Volvo Car Corporation, Honda Motors, Ford Motor Company, NVIDIA Corporation, Tencent, Microsoft. Major automakers are collaborating with AI and tech companies to integrate artificial intelligence capabilities across their model ranges.
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