Connected Cars Market Report 2026

The connected cars market size has grown rapidly in recent years. It will grow from $105.67 billion in 2025 to $121.23 billion in 2026 at a compound annual growth rate (CAGR) of 14.7%. The growth in the historic period can be attributed to infotainment system adoption, smartphone integration demand, growth of vehicle sensors, telematics expansion, automotive digitization.

The connected cars market size is expected to see rapid growth in the next few years. It will grow to $214.42 billion in 2030 at a compound annual growth rate (CAGR) of 15.3%. The growth in the forecast period can be attributed to autonomous vehicle roadmap, smart mobility ecosystems, software-defined vehicles, electric vehicle connectivity needs, data-driven mobility services. Major trends in the forecast period include growth of embedded connectivity platforms, expansion of adas integration, demand for real-time vehicle diagnostics, rise of in-car digital services, adoption of v2x communication.

The increasing adoption of autonomous vehicles is expected to drive the growth of the connected cars market going forward. Autonomous vehicles, also known as self-driving or driverless cars, are equipped with advanced sensors, artificial intelligence (AI) systems, and other technologies that enable operation and navigation without direct human control. Connected cars form a critical foundation for autonomous vehicle functionality, facilitating data exchange, improving navigation, enhancing safety, and providing the necessary infrastructure for self-driving cars to operate effectively. For instance, in 2023, according to National Academies Press, a US-based government publisher, self-driving vehicles are approaching commercialization globally, and by 2035, 40% of new cars in the UK could feature autonomous capabilities. Therefore, the growth of autonomous vehicles is driving the connected cars market.

Major companies in the connected cars market are focusing on technological advancements such as comprehensive digital vehicle profiles to improve data transparency, ownership verification, and lifecycle management. Digital vehicle profiles are secure, centralized records storing a vehicle’s complete history, including manufacturing information, maintenance records, accident history, and ownership transfers. For instance, in May 2025, Hyundai India, an India-based automotive manufacturer, launched a digital vehicle passport for its customers. The digital passport enhances vehicle data accessibility, ensures transparency in pre-owned vehicle transactions, improves aftersales service efficiency, and fosters trust between manufacturers, dealers, and owners, driving innovation and digital adoption in the automotive sector.

In June 2025, NXP Semiconductors, a Netherlands-based semiconductor manufacturer, acquired TTTech Auto for an undisclosed amount. This acquisition aims to accelerate the shift to software-defined vehicles, expand NXP’s automotive product portfolio, strengthen capabilities in advanced vehicle control systems, and drive innovation and growth in the automotive semiconductor market. TTTech Auto, based in Austria, specializes in the development and commercialization of advanced automotive software and hardware solutions.

Major companies operating in the connected cars market report include Volkswagen, Toyota Motor Corporation, General Motors, Daimler AG, BMW Group, Ford Motor Company, Honda Motor Co Ltd, Hyundai Motor Group, Tesla, Renault, Tata Motors Limited, Mahindra and Mahindra Ltd., NIO Inc., XPeng Inc., Geely Automobile Holdings Limited, Nissan Motor Co., Ltd., Mitsubishi Motor Corporation, Audi AG, Fiat Chrysler Automobiles, Mercedes-Benz, SAIC Motor, Dongfeng, FAW, Changan Automobile, Beijing Automotive Group, Brilliance Automotive, Guangzhou Automobile Group, Chery Automobile, Jianghuai Automobile Group (JAC), Stellantis, Jaguar Land Rover, Suzuki Auto South Africa, GAZ Group, Kamaz.

Asia-Pacific was the largest region in the connected cars market share in 2025. Western Europe was the second largest region in the global connected cars market. The regions covered in the connected cars market report include Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the connected cars market report include Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The connected cars market consists of sales of connected cars such as Vehicle to Vehicle (V2V), Vehicle to Infrastructure (V2I), Vehicle to Cloud (V2C), Vehicle to Pedestrians (V2P), and Vehicle to Everything (V2X). Values in this market are factory gate values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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