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Software-Defined Architectures and Over-the-Air Ecosystems Take Precedence over Hardware as the Core Value Driver for Next-Generation Mobility
12-Jun-2026
Global
Market Research
PL6G-01-00-00-00
AU_2026_34655
This Frost & Sullivan Global Connected Vehicle Market Growth Outlook examines the key strategies, growth drivers, and challenges shaping the future of mobility. The move toward software-defined systems and over-the-air (OTA) updates is becoming more important than hardware. There is also growing demand for seamless connectivity in autonomous vehicles and more use of AI-driven personalization. Key challenges include cybersecurity risks, varying regulations across regions, and the difficulty of integrating legacy hardware. The report identifies growth opportunities for OEMs, Tier I suppliers, and software providers, particularly through subscription-based OTA updates, data analytics, and ecosystem partnerships.
The analysis reviews how various OEM groups collaborate and develop their connectivity systems. It highlights partnerships with cloud providers, telecom companies, and AI platform developers to create more dynamic, user-focused mobility solutions. The report also tracks the progress of software-defined vehicles (SDVs) and how they enable trends such as advanced autonomy, immersive in-cabin experiences, and vehicle-to-everything (V2X) communication.
The report emphasizes how OTA ecosystems and new software designs are changing what makes vehicles valuable. These changes help generate ongoing revenue and speed up the shift from hardware-focused to service-based business models. The analysis uses 2025 as the base year and includes connectivity forecasts from 2026 to 2032.
Growth Environment
Connected Car Market Outlook 2025: Forecast Versus Actual
CES 2026 Highlights: Vehicles Moving from Hardware to Software
Notable Regulations and Mandates: A Snapshot
Regional Connected Vehicles Market
OTA-Enabled Vehicles: Regional Analysis
Key OEM Partnerships
Connected Vehicle Ecosystem and Related Markets
Transformation in the Connected Vehicles Industry
Why is it Increasingly Difficult to Grow?
The Strategic Imperative 8™
The Impact of the Top 3 Strategic Imperatives on the Global Connected Vehicle Industry
Growth Opportunities Fuel the Growth Pipeline EngineTM
Ecosystem
Research Scope
Definitions: Market Segmentation
Global Connected Services Maturity Matrix
The Impact of the Top 3 Strategic Imperatives on the Global Economy
Global Economic Transformations for 2026
Global GDP Growth Annual Snapshot
Global GDP Growth Quarterly Snapshot
Global GDP Growth
Visioning Scenarios: 2026 Global Macro Conditions
North America Growth: Visioning Scenarios
Western Europe Growth: Visioning Scenarios
Middle East Growth: Visioning Scenarios
Asia Growth
Asia Growth: Visioning Scenarios
India: Growth and Visioning Scenarios
List of Countries by Region, 20261
Snapshot of Connectivity Regulations
Top Trends Driving the Global Connected Vehicles Market
Trend 1 — SDVs
Case Study—Volkswagen Group (CARIAD and VW.OS)
Case Study—Qualcomm Snapdragon Digital Chassis
Trend 2 — V2X Communication and Connected Road Safety
Case Study—Mercedes-Benz (Car-to-X Communication)
Case Study—Bosch V2X Communication Ecosystem
Trend 3—Digital Cockpits and Immersive In-Car Experiences
Case Study—Mercedes-Benz MBUX and Hyperscreen
Case Study—CINEMO AI Cockpit Platform and CARS™ Connect Suite
Trend 4—AI and Predictive Vehicle Operations
Case Study—Tesla AI-Driven Predictive Vehicle Operations
Case Study—Continental Automotive Edge (CAEdge)
Trend 5—In-Car Commerce and Digital Services
Case Study—BMW ConnectedDrive Store
Case Study—Harman Ignite Store and Ignite Store Payments Platform
Trend 6—Rise of Automotive Insurtech
Case Study—Tesla Insurance (Embedded Insurance)
Case Study—Octo Telematics Connected Insurance Platform
Impact of Trends by Region, 2026
Connected Vehicle Penetration by Region
Product Type Forecast
Product Type Snapshot by Region
Pricing and Service Models
OTA-Enabled Vehicle Sales by Region
OTA-Enabled Vehicle Penetration by Region
OTA Phases and OEM Strategies
Regional Analysis: APAC
Regional Analysis: China
Regional Analysis: Europe
Regional Analysis: India
Regional Analysis: Japan
Regional Analysis: North America
Regional Analysis: South America
Regional Analysis: South Korea
Key Findings: Top 10 Predictions for 2026
Growth Opportunity 1: 5G Connectivity and Real-Time Data Platforms
Growth Opportunity 2: Vehicle-to-Everything (V2X) Infrastructure and Smart Mobility Ecosystems
Growth Opportunity 3: In-Vehicle AI Assistants and Personalized Connected Services
Benefits and Impacts of Growth Opportunities
Next Steps
List of Exhibits
Legal Disclaimer
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The analysis reviews how various OEM groups collaborate and develop their connectivity systems. It highlights partnerships with cloud providers, telecom companies, and AI platform developers to create more dynamic, user-focused mobility solutions. The report also tracks the progress of software-defined vehicles (SDVs) and how they enable trends such as advanced autonomy, immersive in-cabin experiences, and vehicle-to-everything (V2X) communication.
The report emphasizes how OTA ecosystems and new software designs are changing what makes vehicles valuable. These changes help generate ongoing revenue and speed up the shift from hardware-focused to service-based business models. The analysis uses 2025 as the base year and includes connectivity forecasts from 2026 to 2032.
| Deliverable Type | Market Research |
|---|---|
| Industries | Automotive |
| No Index | No |
| Is Prebook | No |
| Keyword 1 | Connected Vehicle Market |
| Keyword 2 | Automotive Connectivity Solutions |
| Keyword 3 | Smart Mobility Analysis |
| Podcast | No |
| Predecessor | PFTZ-01-00-00-00 |
| WIP Number | PL6G-01-00-00-00 |