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In Automotive Connectivity, Rolling Wireless Tops Module Market, Qualcomm Dominates Chipset Market in H1 2022

Qualcomm dominates automotive connectivity chipset market with more than 80% share
Rolling Wireless leads the automotive connectivity module market, followed by LG and Quectel
One in two connected cars will have 5G connectivity by 2027

San Diego, Buenos Aires, London, New Delhi, Hong Kong, Beijing, Seoul – September 22, 2022

Global automotive connectivity module and chipset shipments grew by just 3% YoY in H1 2022, according to the latest research from Counterpoint’s Global Automotive NAD Module and Chipset Tracker.

China is the largest region as electric vehicle players, including new start-ups such as NIO, Xpeng Motor and Seres, are offering infotainment systems with large displays and smart cockpit solutions that have a wide array of features, and ADAS that requires embedded connectivity. But during H1 2022, automotive connectivity module shipments in China declined by almost 7% YoY due to slow car production caused by supply chain disruption and COVID-19 restrictions.

Automakers across Europe are trying to generate significant revenues from in-car software services via subscriptions. For this, they are now offering embedded connectivity, even in lower vehicle trims. The Ukraine crisis derailed the European automotive market’s post-COVID recovery. Automotive connectivity module shipments in Europe declined by more than 10% YoY as car production in Germany, France, UK, and other European nations suffered due to the lack of components caused by the Ukraine crisis.

While the two biggest markets could not avoid the effects of the geopolitical crisis and fresh COVID restrictions, North America remained more resilient with automotive connectivity module shipments increasing by 27% YoY during H1 2022.

Commenting on the market dynamics, Senior Research Analyst Soumen Mandal said, “With the increasing adoption of digital features and ADAS, the requirement for embedded connectivity in passenger vehicles will increase. The sales penetration of connected cars surpassed those of non-connected cars for the first time H1 2022. Previously, embedded connectivity was prevalent in luxury models, but now mainstream players like Volkswagen, Toyota and Stellantis are offering connectivity for their mass-market cars.

Qualcomm has a dominant position in the chipset market with more than 80% market share. The strong product portfolio and partnerships with major tier-1 suppliers and automakers are all helping Qualcomm. And now, Qualcomm is offering complete solutions for automotive digital transformation starting with hardware and extending to cloud services with the Snapdragon Digital Chassis. This one-stop solution is helping ecosystem players reduce time to market and be more competitive.

MediaTek and Samsung launched 5G solutions last year. As the automotive sector is gradually adopting 5G connectivity, we expect MediaTek and Samsung to increase their market share in 5G automotive connectivity. However, they will likely require a more concerted effort to substantially grow their share and benefit from greater economies of scale.”

Source: Counterpoint Global Automotive NAD Module and Chipset Tracker, Q2 2022

Automotive specialists lead, but IoT giants aiming for slice of module market

Commenting on the automotive connectivity module player dynamics, Research Vice President Neil Shah said, “Automotive connectivity modules must pass various quality and compliance tests and certifications, hence special expertise is an advantage. Consequently specialist automotive connectivity module players such as Rolling Wireless and LG are leading the market. Quectel, the largest IoT module player, has broken into the top three rankings due to strong performance in its domestic China market. We have seen Quectel gain certification for automotive-grade modules with North American and European telecom operators. This will give strong competition to traditional specialist players like Rolling Wireless, LG, Continental and Harman.

The entry barriers are relatively high for IoT module players but the revenue opportunity afforded by the automotive transformation is attractive. Nevertheless, geopolitical trade tensions and data security concerns will likely be a barrier to Chinese IoT module players penetrating international markets.

Automakers will aim to multisource modules to offset supply-chain risks while supporting the growing demand for connectivity. In addition, we expect some emerging countries like India, Indonesia, Thailand and Brazil will try to build their own manufacturing ecosystem to have better control over the supply chain.”

Source: Counterpoint Global Automotive NAD Module and Chipset Tracker, Q2 2022

Discussing the market outlook, Research Vice President Peter Richardson commented, “Automotive connectivity module shipments are expected to grow annually by around 11% on average to reach 97 million units by 2030. The demand for 5G modules is increasing and we expect around a half of connected cars sold in 2027 will have 5G connectivity. The evolution of centralised architecture with digital cockpit, autonomous capability (ADAS L3+) and electrification will drive growth for 5G technology.

In terms of revenue, the automotive connectivity module market is projected to reach $5 billion by 2030. The multi-billion segment opportunity will ensure the segment remains vibrant and highly competitive.”

For detailed research, refer to the following reports available for subscribing clients and individual subscription:

Counterpoint tracks and forecasts on a quarterly basis 25+ NAD module vendors’ shipments, revenues and ASP performance across 10+ chipset players, and major geographies.

Background

Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

Analyst Contacts:

Soumen Mandal

Neil Shah

Peter Richardson

Counterpoint Research

press@counterpointresearch.com

Related Reports:

Global Telematics Control Unit Shipments Grew 13% YoY in 2021

LG led the global TCU market in 2021, followed by Continental and Harman.
US, China and Germany were the top three geographies in the global TCU market.
5G is still a niche segment, capturing less than 1% of global TCU volumes.

San Diego, Buenos Aires, London, New Delhi, Hong Kong, Beijing, Seoul – April 7, 2022

Global telematics control unit (TCU) shipments grew 13% YoY in 2021, according to the latest research from Counterpoint’s Global Telematics Control Unit Tracker. This growth came despite the COVID-19 outbreak and supply chain shortages, and was driven by the rising penetration of connected cars and the consumer preference for digital features. Moreover, favourable government policies such as eCall mandates are also helping this market to grow. The global ASP (average selling price) of TCUs increased slightly in 2021 due to the rising cost of 4G chipsets. We expect the supply situation to remain constrained through much of 2022.

Commenting on the market dynamics, Senior Research Analyst Soumen Mandal said, “LG leads the global TCU market, followed by Continental and Harman. These top three players account for nearly three-quarters of the market.

LG’s TCU shipments grew 19% YoY in 2021. Its close relationships with GM and Volkswagen in the Chinese and US markets are helping LG maintain its leadership position. LG is leading across all major regions except Europe.

Continental, the second-largest TCU player, has a good hold on the European market, especially Germany, France and UK. However, it lost around 2% market share in 2021 compared to 2020. Continental launched 5G TCUs in early 2022 to target 5G opportunities in the automotive sector. We expect this to help Continental regain share in the coming quarters.

Harman, the third-largest player, is mainly focused on the luxury car market. It is already offering 5G TCUs with leading premium brands. Harman’s expertise in the automotive industry and its strong distribution channels via Samsung will likely help it to win more deals and improve its position.

Among other brands, Denso and Visteon made big improvements in the TCU brand ranking list for 2021. The partnerships between Denso and Toyota, and Visteon and Ford are proving beneficial for these brands.”

Source: Counterpoint Global Telematics Control Unit Tracker, Q4 2021

With technology transitions, 2G and 3G are unable to meet the data demands of cars. And with especially 3G being phased out, 4G and 5G are becoming the only viable options. Currently, more than 90% of connected cars are using 4G TCUs. However, 4G is reaching maturity. We have already seen a few 5G chipsets, NAD modules and TCU launches in 2021. We expect more cars will be equipped with 5G connectivity this year. Moreover, increasing penetration of autonomous vehicles and C-V2X deployment will help in 5G adoption as well.

Looking at connectivity trends, Research Analyst Mohit Sharma said, “As we move to higher levels of autonomy, the amount of data generated by ADAS sensors will surpass 400MB/s. To process all this data, high processing power will be required. In addition, more sophisticated AI algorithms will be required along with large volumes of data storage. The industry has to shift to 5G for cloud computing. 5G will provide more than 30 times faster data speeds and promises to reduce latency by 10 times.”

Autonomous vehicles, connected cars and electrification are the main trends shaping the future of mobility. Connectivity will be the backbone of these systems. OEMs are enhancing existing connectivity services like infotainment and OTA software updates while adding newer services like custom entertainment packages and insurance. Automakers are pushing connected services to diversify their revenue streams and more closely understand the overall customer behaviour to improve their car’s performance and services.

Source: Counterpoint Global Telematics Control Unit Tracker, Q4 2021

On future perspective, Associate Director Brady Wang said, “Global TCU shipments are expected to grow at a CAGR of 15% during 2020-2025. In terms of value, the TCU market will grow more than twofold to reach $7 billion by 2025. The rising penetration of higher-priced 5G TCUs is one of the major reasons for this huge growth. In terms of shipments, 5G will be the fastest (206%) growing technology during the forecast period.”

For detailed research, refer to the following reports available for subscribing clients and also for individual subscription:

Counterpoint tracks and forecasts on a quarterly basis 10+ TCU brands’ shipments, revenues and ASP performance across 4 cellular technologies and 10 major geographies.

Background

Analyst Contacts:

Soumen Mandal

Brady Wang

Mohit Sharma

Counterpoint Research

press(at)counterpointresearch.com

Related Reports:

COVID Dents TCU Shipments but Recovery Looks Promising

Continental, LG, and Harman together account for a majority of global TCU shipments.
One in four TCUs shipped in 2025 will be 5G-enabled. Automakers will focus on future-proofing their cars, accelerating the adoption of 5G TCUs.

San Diego, Buenos Aires, London, New Delhi, Hong Kong, Beijing, Seoul – January 28, 2021

The Telematics Control Unit (TCU) market is expected to grow at a compound annual growth rate (CAGR) of 14.4% during 2020-2025, with the market value surpassing $6.3 billion by 2025, according to the latest research from Counterpoint’s Smart Automotive service. The TCU data here refers to both passenger and commercial vehicles. Higher penetration of connected cars employing 4G-enabled TCUs will be visible till 2025. But with countries deploying 5G infrastructure rapidly, automakers will gradually shift to 5G-enabled TCUs having fallback compatibility to cover a wide range of connected car services with seamless network coverage.

In 2020, COVID-19 drastically impacted the already declining automotive sales in several ways:

Automotive factories operated irregularly for many weeks and also saw employee layoffs in H1 2020. This affected the final vehicle assembly.
Subdued consumer sentiments toward expenditure on non-essential items resulted in a decrease in new vehicle registrations. However, with vehicle purchase incentives in place, short-term recovery can be expected.

The implementation of E-call regulation in the EU initially led to a boom in TCU shipments while similar initiatives have been taken in other regions too, such as EVAK/ERA GLONASS (January 2017) in Kazakhstan and Russia, and K-ecall (2021 onwards). Other important factors driving TCU adoption include changing consumer preferences towards safety/entertainment features and the recent increase in interest in electrical vehicles (EVs), which employ upgraded TCUs for battery management and vehicle performance. For instance, GM has increased its budget for electric and automated vehicles from $20 billion to $27 billion and plans to launch 30 new EVs globally in the next five years (over 20 of them are planned for North America alone). The telematics industry is poised for growth in the coming years as automakers promote connected services to attract buyers and earn additional revenue through subscriptions.

Commenting on the TCU market, Senior Analyst Aman Madhok said, “Continental, LG, and Harman accounted for more than 50% shipments in 2020. Continental has been supplying to a variety of automakers, both luxury and non-luxury, besides having a presence in major markets worldwide. During the last few years, Continental has overtaken LG in terms of market share due to new contracts and the increasing penetration of TCUs in mass-produced vehicles. Harman bagged a contract from BMW to supply its latest 5G-enabled TCUs in 2021. Furthermore, it managed to associate with the likes of VW and Maruti Suzuki in recent years.”

Madhok added, “On the other hand, LG’s market share is declining due to its heavy dependence on GM, which has reached a saturation point in terms of TCU penetration.”

The Smart Automotive report also differentiates the embedded TCUs based on cellular connectivity. Looking from the connectivity perspective, Research Vice-President Peter Richardson said, “5G penetration is on the rise and TCU suppliers have already started to sign contracts with their respective customers (automakers) to supply 5G-enabled TCUs. Continental will lead here too. It has already won contracts to supply 5G TCUs to two European car manufactures. Continental will be followed by LG and Harman. GM’s recent bullish sentiment towards complete electrification of its vehicles and aggressive plans for employing 5G technology will benefit LG to expand its 5G portfolio. Falling prices of 5G TCUs will enable their adoption in mid-price cars, with automakers like GM, Ford, and VW leading 5G connectivity by 2025.”

The comprehensive and in-depth ‘Global Telematics Control Unit Market Tracker, 2021’ from our Smart Automotive service is available for purchase at report.counterpointresearch.com. Feel free to contact us at press(at)counterpointresearch.com for questions regarding our latest research and insights.

Background

Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media, and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects, and detailed analyses of the mobile and technology markets. Its key analysts are experts in the high-tech industry with an average tenure of 13 years.

Analyst Contacts:

Peter Richardson

Aman Madhok

Fahad Siddiqui

Counterpoint Research

Top 10 Automotive Announcements in CES 2020

The Consumer Electronics Show (CES), one of the largest global platforms to showcase consumer electronics technologies and innovation, was held in Las Vegas, USA, this year from 6th to 10th January.

Over the past few years, CES has been incorporating more and more automotive players and technologies. With the growing emergence of connected vehicles with cellular communication and the emergence of 5G playing an increasing role for vehicles to share information to support and safeguard automotive applications, the overlap of consumer electronics and automotive industries is inevitable.

Counterpoint analysts’ top 10 automotive-related announcements from this year’s CES:

1. Sony unveiled its concept Vision-S electric car

In association with NVIDIA, HERE, Continental, BlackBerry, Gentex, Magna, Electrobit, ZF and Benteler, Sony showcased its first-ever concept car, the Vision-S. The 268 bhp car has 33 embedded safety sensors. BlackBerry QNX is providing dashboard software for this concept electric car. While there were no immediate plans to mass-produce the Vision-S, it was used to demonstrate Sony’s capabilities and vision in sensors, AI, infotainment and user interfaces for automotive applications. With the increased digitalization of the automotive industry, electronics players like Sony are going beyond infotainment to focus on growth opportunities in multiple lucrative sectors, such as ADAS components.

2. Uber and Hyundai team up to offer flying car services from 2023

Uber and Hyundai have partnered to provide electric flying car services, from 2023. The flying car will be able to travel at 180 mph with a range of up to 60 miles. Counterpoint believes that commercial flying car services are at least a decade away from reality. While exciting considerable interest, any prospect of commercial reality will be hampered by massive regulatory hurdles.

3. LG in partnership with Microsoft to develop autonomous driving and infotainment systems

LG has formed a strategic partnership with Microsoft to combine its in-vehicle infotainment platform – webOS Auto, with the cloud-based Microsoft Connected Vehicle Platform (MCVP) to offer improved connected services, including audio and streaming. Both companies have also partnered in developing autonomous driving software. LG is looking to leverage the AI expertise of Microsoft to improve its ADAS, Driver-Status Monitoring Camera (DSM) and Multi-Purpose Front Camera products.

4. Verizon collaborating with HERE to provide better-connected vehicle services

Verizon and HERE have signed a multi-year partnership to develop new connected services. Verizon will provide its 5G Ultra Wideband network and multi-access edge compute (MEC) platform and HERE will allow Verizon access to its location data, Software Development Kits (SDKs), and Application Programming Interface. This collaboration of Verizon and HERE will help Verizon improve its 3D positioning algorithms with 5G Ultra-Wideband and 5G Edge. HERE will also be able to upgrade its location ecosystem in real-time wherever the higher bandwidth from Verizon is available. This partnership is an attempt to establish enhanced integrated connected vehicle platforms, offering lower latency and more precise location systems.

5. Qualcomm launches a new autonomous driving platform

Qualcomm has announced it’s entering the Autonomous Vehicle (AV) arena with the unveiling of its AV platform, Snapdragon Ride, focused on advance Cellular Vehicle-to-Everything (C-V2X) communication. Though a late entrant in the AV space, Qualcomm with its vast experience in smartphone technology, will prove to be a significant partner to automakers. General Motor (GM) has already announced installing Snapdragon Ride in its cars. Production versions of Snapdragon Ride fitted cars will start from 2023. This platform from Qualcomm is expected to give strong competition to current autonomous driving players NVIDIA, Intel, and Microsoft.

6. Toyota plans to build a smart city from 2021

Toyota has announced plans to build ‘Woven City’, a 71 hectares smart city at Mount Fuji, 60 miles from Tokyo, by 2021. Toyota is among the first large global automakers to enter into the smart city business race. Toyota will use this city to test emerging automotive technologies such as fuel cells and autonomous driving. Toyota will, possibly, also explore its proposed electric flying car service, fulfilling its aspiration to be the pioneer in the category.

7. Intel demonstrates autonomous vehicles equipped only with cameras, no other sensors

Intel’s subsidiary, Mobileye, showed an AV equipped with 12 cameras but no other sensors. The EyeQ5 chip creates a 3D model, by processing 2D images, to sense the environment. Using full-stack camera systems to improve computer vision, Intel is aiming to reduce the Mean Time Between Failure (MTBF) of its sensing system leading to violation of its safety standards to 10-4 and ultimately to 10-7 – equivalent to driving for 10 million hours without a safety-critical error. By using camera-based sensors, while foregoing LiDAR and radar, Mobileye believes it can reduce the cost of autonomous vehicle development as well as potentially speed up development. However, it will take considerable testing to prove such alternate surround vision systems can comply with regulatory and public safety authorities/standards – this, therefore, is another focus area.

8. Quectel announced 5G automotive module

Quectel announced developing 5G automotive modules AG550Q – a 5G, Sub-6GHz module, AG215S – an automotive Extensible Authentication Protocol (EAP) module dedicated to C-V2X, and AF50T- a Wi-Fi module. An early entry in 5G module production can give Quectel an advantage over other module players. Quectel’s partnership with Qualcomm will also help it offer advanced connectivity modules to OEMs and tier 1 suppliers.

9. Amazon integrating new services in Alexa Auto

Looking to further its partnership with automakers, Amazon announced adding new features like Amazon Pay, and Fire TV in Alexa Auto. BMW and Fiat Chrysler Automobiles will be among the first automakers to offer Fire TV integrated with Alexa Auto in their vehicles. The automotive voice assistant feature is currently dominated by embedded iOS CarPlay and Android Auto platforms. Amazon is working with system integrators and software providers like Bosch, HERE, MELCO, Telenav and TomTom for a seamless embedded voice-assistant based in-vehicle navigation experience. Lamborghini and Rivian have also announced integrating Alexa Auto in their forthcoming vehicles.

10. Google showcased improved Android Auto with integrated Google Assistant

Google announced the integration of Google Assistant to its existing Android Auto product portfolio. Google is partnering with Volvo and BMW to market these new features. Information from Android Auto can be projected to a head-up display (HUD) with this new version of Android Auto. Google’s Android Auto will face strong competition from Apple CarPlay and Amazon Alexa as each looks to exert influence on the automotive cockpit.

Global HUD Shipments to Reach 15.6 Million Units by 2025

With increasing road accidents in the world, the demand for embedded Head-up display (HUD) is rising. HUD ensures easy and safe reading of critical information like car speed, warning signals, indicator arrows for navigation, and fuel level. We estimate that the total global embedded HUD shipment will reach 15.6 million by 2025, with a CAGR of 17% during the 2019-2025 period. The following is our analysis and our forecast of how the global HUD market will behave till 2025.

EVs to Account for 16% of HUD Sales by 2025, Regulations Key to Adoption

Electric vehicles (EVs) are more tech-savvy than internal combustion engine (ICE) vehicles, and EV car-buyers are more willing to pay extra for advanced features like HUD. Therefore, we expect EVs to drive the HUD market because the adoption rate of other smart features like Advanced Driver Assistance System (ADAS), connected car technology, and more, being higher than conventional cars. EVs including battery electric vehicles (BEV), plug-in hybrid electric vehicles (PHEV) and hybrid electric vehicles (HEV) will cover 30% of total vehicle sales by 2025. We expect EVs to account for 16% of total HUD sales by 2025. SUVs and autonomous vehicles are other potential segments for HUDs. In fact, once more L4 autonomous vehicles are introduced in 2023, we expect a rise in the market penetration of HUDs.

China to continue to dominate global HUD market till 2025

China is expected to dominate the global HUD market during the forecast period, owing to rising sales of premium and mid-segment cars, which are more likely to have embedded HUDs. Moreover, China will account for a significant share of EV shipments in the world, benefiting HUD sales in the country. The US and Europe are also expected to see good growth during 2019-2025. Brazil, Canada, Mexico, and UAE will contribute more to the rest of the world section (RoW). The geography-wise global HUD market share by 2018 is shown below:

Integrated and AR-based HUDs to become popular

In the future, HUDs will get integrated with the vehicle’s systems and display additional information, including outside weather, On-Board Diagnostic (OBD) information, location search, and smartphone-based app services. The augmented reality (AR) based HUDs will identify blind spots and show timely warnings to prevent accidents. Moreover, holographic pictures will ensure better visibility, sharpness, picture quality.

Combiner HUD to Continue Dominate

Cheaper combiner HUDs will continue to dominate the global market. However, windshield HUDs will see a much faster growth during the 2019-2025 period.

Windshield HUD – projecting images on the vehicle’s windshield – will increase its penetration in the global HUD market because it will be able to display more information with greater visual comfort. The higher cost of windshield HUD is hindering its growth for now, and it will have more penetration on premium segment cars.

The combiner HUD – with information displayed on a separate combiner display – will have significant market share in medium and lower segment cars. The robustness design with an affordable price of these HUDs will help to get more sales in medium and lower segment cars.

OLED Restricted to Luxury, TFT-LCD to Dominate Mass Market

The automotive industry is going through digitalization, driven by connected technology. The rising demand to display more data to the driver will help grow the demand. While demand for expensive OLED displays is increasing among luxury automakers, LCDs will continue to account for a vast majority of sales by 2025.

BMW, Jaguar Land Rover, Mercedes-Benz are considering for OLED display in premium segment cars. The shortage of OLED supply has also restricted the penetration of OLED screen in the global HUD market. It will create a huge opportunity for OLED suppliers like Samsung Display, LG Display, BOE, and JDI. Still, LCDs will dominate the HUD market during the forecast period due to lower pricing and easy availability in the market.

Continental Expected to Dominate the Market, With Focus on R&D and Product Innovation

The major players in the global embedded HUD market are Continental, Denso, Nippon Seiki, Bosch, and Panasonic. Harman, Garmin, and Hudway are the major aftermarket suppliers in the HUD market. Continental is investing more in product development and creating several product lines. Panasonic has recently entered the market and got a contract for supplying HUDs to Jaguar Land Rover.

Focus on AR & Driver Safety to Push HUD Adoption Among all Vehicle Categories

The HUD makers are trying to produce compact size HUD to target medium and lower segment cars. However, the display size of HUDs installed in premium vehicles continues to increase. In the future, a considerable portion of the windscreen will be used for displaying all the critical information in L4 and L5 level autonomous vehicles. This presents a great opportunity for Gentex, Magna, Samvardhana, and other players for supplying HUDs.

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Insights Tag： Continental

In Automotive Connectivity, Rolling Wireless Tops Module Market, Qualcomm Dominates Chipset Market in H1 2022