Automotive Radar Market
Global Industry Analysis (2017 – 2020) – Growth Trends and Market Forecast (2021 – 2027)
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Demand for Vehicle Safety Gains Ground, Spurring Automotive Radar Market Growth
According to the World Health Organization, approximately 1.35 million people die every year due to road crashes, and by 2030, road traffic crashes will be the seventh leading cause of death. The African region has the highest road traffic fatality rate at 26.6, followed by the European region at 9.3. Thus, automakers must leverage the huge potential of automotive radar market to grow in these regions.
Due to reports of increasing road traffic injuries, consumers have become much more aware about the dire need for vehicle safety. With growing significance of passengers’ safety and the safety of pedestrians, demand for safety features in automobiles has been rising rapidly. Moreover, improved spending capacity and shifting lifestyle preferences of consumers are accelerating the growth of automotive radar market.
Demand for Premium Vehicles due to Easy Availability of Financial Schemes to Drive Automotive Radar Market
As per the Organization of Motor Vehicle (OICA), the demand for premium vehicles is expected to surge to 566 billion in 2026 due to better financial schemes available for premium segment cars. Most banks and financial institutions are offering about 100% funding of the new car loan for premium vehicles. Upsurge in premium car sales will clearly benefit the market by fueling automotive radar installations.
Safer Vehicles Gain Spotlight with Rise in Rural-to-Urban Commutation and Vice Versa due to Hub and Spoke Architecture
Due to rise in urban sprawls and development of hub and spoke architecture, commutation from rural to urban areas and vice versa has dramatically increased. According to statistics by OICA, 5,934,467 new vehicles have been already registered in 2021 even before Q1 ends. A sizeable number of vehicles in modern automotive market has at least one advanced safety feature like adaptive cruise control, and autonomous emergency braking, which is also responsible for the growth of automatic radar market.
Technological Innovations Favour the Progress of Automotive Radar Market
The rise in technological advancements and integration of Artificial Intelligence (AI) in electronic components like lidar, automotive radar with cloud storage and increasing preference for wireless communication are expected to provide a better safety environment to the consumer. Due to increased usage of park assistance, safety alarms, collision avoidance, the importance of ultrasonic sensors and proximity sensors has risen. Moreover, applications such as adaptive cruise control (ACC), blind spot detection, lane change assist are getting popularized, non-imaging radar will see sustained growth. Such advancements would directly impact the automotive radar market, thereby increasing its sales and giving thrust to the key players
High Price Point and Complexity Pose Challenges to Automotive Radar Market Growth
There is an increased cost involved in installing premium applications like automotive radar in vehicles, which increases the overall price of the cars, thereby hampering the growth of the automotive radar market. Moreover, the requirement of skilled workers due to the service requirements of the sensors lead to a huge complexity, thereby deterring consumers from purchasing pre-installed automotive radar vehicles. The Covid-19 pandemic and lockdowns that followed held a major impact on the entire automotive industry, eventually pulling down demand for automotive radar and other similar auto technology features. As consumers still struggle with jobs, income and normalizing routine lifestyle, advanced vehicle sales are more likely to experience a temporary setback.
Favourable Government Regulations Account for Europe’s Dominance in Automotive Radar Market
The stringent regulatory framework imposed by the European Commission for vehicle safety is expected to drive the growth of the automotive radar market in the region Expansion of premium vehicles segment across Europe is also providing a string thrust to automotive radar market. Apart from this, Asia Pacific is expected to see noticeable developments in the field of automotive radar, banking on the rise in vehicle sales and growing awareness among consumers in developing countries.
Long Range Radar with Autonomous Emergency Braking Application Will Capitalize on Passenger Vehicle Sales
The automotive radar market can be categorized according to the range of RADAR sensors viz medium range and long-range radars, frequency based mainly 24GHz, 79 GHz and 79 GHz vehicle type and application type.
The medium-range radars are expected to witness growth in demand, as a majority of safety systems in vehicles that provide park assists, and traffic alert are equipped with these radars. As the long-range radars are mainly used for adaptive cruise control (ACC), the increase in ACC adoption in mid- and entry-level cars would boost their sales. Moreover, radar with 79 GHz is expected to dominate the market than the earlier versions due to its capabilities such as blind spot monitoring and effectively mapping the entire vehicle surroundings
According to OICA, the passenger car segment witnessed growth of 4.5% from 2015 to 2016, which was accounted by growing awareness about road safety among owners of mid-level cars. As more passenger cars are being equipped with radar system, automotive radar market is expected to rise further. E-commerce expansion and logistical developments will also propel the growth for commercial vehicles. Vehicle autonomy in commercial vehicles will augment the demand in this industry.
Amidst various applications like adaptive cruise control, blind spot detection and more used in an automotive radar system, autonomous emergency braking is expected to be the most in-demand application area. Various government initiatives and increase in investment by automobile companies in development of radar-based safety systems at an affordable cost will favour market growth.
Key Industry Players Invest in Compact and High-performance Radars
The key players in automotive radar landscape such as NXP Semiconductors, Robert Bosch GmbH, Autoliv Inc and Continental AG are focusing on developing compact and high-performance radars, following drastically increasing vehicle electrification. Moreover, the market is witnessing inter-country partnerships, for instance, the recenttie-up between NXP Semiconductors (Netherlands) and Hawkeye Technology (China) can be a potential booster to the growth of global automotive radar market. Similarly, Audi and Aptiv have developed a domain controller for front sensors. The key industry players in the automotive radar market are also focusing on teaming up with premium automakers, which is likely to see the use of automatic gears more rapidly in the future.