5G in Automotive and Smart Transportation Market: Current Analysis and Forecast (2022-2030)

5G is the fifth-generation wireless mobile network technology successor of 3G and 4G. The technology allows a kind of network that is designed to connect people virtually, and everything together including machines, objects, and devices. The technology provides a high-speed cellular network that provides higher multi-Gbps peak data speeds, ultra-low latency, more reliability, massive network capacity, increased availability, and a more uniform user experience to more users. 5G technology enables a wide range of applications and services in automotive and smart transportation. 5G in automotive and transportation refers to the ability to provide real-time communication and monitoring of public transport vehicles and user demand management. The technology has improved the safety features of the automotive industry by enabling vehicle-to-vehicle (V2V) communication, which can prevent accidents by allowing vehicles to communicate with each other and other infrastructure such as traffic lights.

The 5G in Automotive and Smart Transportation Market is expected to grow at a steady rate of around 30% owing to the increasing number of sales of autonomous vehicles. With the emergence of new technologies such as high-speed networks, edge computing, and others driving the car without human intervention is possible. The recent era is witnessing a sharp growth in urban life and the growth brought the need for high mobility and drastic changes in transportation technologies. Autonomous vehicles play one among the major components in the innovative solutions for promoting smart transportation systems in which various vehicles on the road communicate with one another with the utilization of a communication infrastructure for exchanging critical information like traffic, congestion, and road conditions. This has created a massive demand for 5G in the automotive and smart transportation market. For instance, in 2022, According to the report published by the Insurance Institute for Highway Safety a US-based non-profit organization that provides safety ratings for motor vehicles expected there will be 3.5 million self-driving vehicles on U.S. roads by 2025, and 4.5 million by 2030.

Based on solution, the market is segmented into hardware, software, and services. The hardware category is currently dominating the market and is expected to see the same trend in the forecast period. The major factor attributing to the growth of the segment is the deployment of 5G networks all over the world which requires significant investments in infrastructure such as network equipment, small cells, and antennas. The segment consists of various components such as user equipment, radio access points, and base stations which are essential for the deployment of 5G networks. Moreover, due to increasing demand for high-speed connectivity and the need for efficient transportation have increased the demand for the hardware segment in 5G in the automotive and smart transportation market in coming years.

Based on application, the market is segmented into vehicle-to-everything, infotainment and telematics, and fleet management. The vehicle-to-everything is currently the leading segment and is expected to dominate the segment in the forecast period. In addition to communicating with each other vehicles and infrastructures, such as traffic lights, road signs, and GPS systems, V2X technology enhances road safety and reduces traffic congestion. The technology also enables vehicles to share information like speed, location, and direction, enabling them to make more informed driving decisions.

On the basis of end-user, the market is categorized into automotive, defense, transportation & infrastructure, warehousing & logistics, public safety, and others. Among these, the automotive segment to hold a significant share of the market in 2022. This is mainly due to rapidly evolving automotive industries all around the world, especially countries such as China, and India. The government of these countries is highly supporting the development of the automotive industry by launching various government initiatives such as the Make in India, and the Make in China 2025 plans. Furthermore, the increasing demand for autonomous and connected vehicles requires high-speed and low-latency connectivity to transmit a large amount of data, and 5G networks offer these capabilities.

For a better understanding of the market adoption of 5G in Automotive and Smart Transportation industry, the market is analyzed based on its worldwide presence in the countries such as North America (U.S., Canada, Mexico, Rest of North America), Europe (Germany, U.K., France, Italy, Spain, Rest of Europe), Asia-Pacific (China, Japan, India, South Korea, Rest of Asia-Pacific), Rest of World. The North America region is projected to be the fastest growing region in the forecast period as the region is going through the heavy automotive expanding industry with major big giants such as General Motors, Tesla, and others. The region is the IT hub that continuously develops new and advanced technologies to support the incremental growth of the telecommunication industry by providing funds to stand the market. For instance, in April 2023, according to the report published by The Wall Street Journal, reports that the US government started planning for the next generation of wireless communications, known as 6G. The Federal Communications Commission (FCC) has initiated a process to free up spectrum for 6G and has set a goal of having a plan in place by 2023. The FCC has also announced a USD 200 million fund to support the development of 6G technology in the US.

Some of the major players operating in the market include: Audi AG, Robert Bosch GmbH, BMW Group, Deutsche Telekom AG, Huawei Technologies Co., Ltd., Mercedes Benz, Nokia, Qualcomm Technologies, Inc., Verizon, and Vodafone Group Plc.