Artificial Intelligence (AI) is set to revolutionize the automotive industry in several ways over the next two decades. According to market research, the global autonomous car market is projected to grow from $56 billion in 2019 to $159 billion by 2027, while the automotive AI market is expected to grow at a compound annual growth rate (CAGR) of 39.8% from 2019 to 2027. AI will enable autonomous vehicles to become mainstream, transforming most aspects of the automotive manufacturing process from research and design to project management and business support functions.
The integration of AI in the automotive industry will lead to significant efficiencies and cost savings across the entire value chain. It will also create additional revenues from vehicle sales and aftermarket sales. AI will optimize core processes along the value chain, with most of the value generated in four core processes. Furthermore, 5G technology will be increasingly integrated into cars, expanding access to the internet and bridging the digital divide. AI will enable cars to drive themselves, thanks to increasingly sophisticated and precise sensors such as radar, cameras, and lidar, whose data will be processed in real-time by AI capable of making decisions in different scenarios. Overall, AI is set to become the new engine of value for auto companies, with the automotive AI market projected to witness a staggering CAGR of 55% from 2023 to 2033.