Automotive Data Monetization Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Automotive Data Monetization Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Automotive Data Monetization Market is expected to grow at a CAGR of 39.21% over the forecast period. In the current technological scenario, independent software vendors have turned to self-service business intelligence to increase application revenue and differentiate their offerings.

Key Highlights

• Similarly, self-service BI can contribute to application ROI for enterprises developing applications by increasing adoption and improving operational efficiencies. Data monetization is gaining interest as companies become more interested in discovering the value in their otherwise underutilized data. Monetizing data requires time, energy, and investment by combining business and technical experts with complementary skills.
• Increased and sophisticated analytics and big data in automotive applications to provide extra features and services in cars, lower operating costs and investment, and improve driver and passenger safety drive the global automotive data monetization market revenue growth. Vehicles are becoming more connected, and advances in road infrastructure and the number of sensors employed result in massive data quantities being generated. The information gathered can be used and commercialized, but this is still in its early stages.
• Other significant reasons supporting the automotive data monetization market growth are the growing number of connected vehicles and the permission and activation rate of these vehicles among consumers. Further, to generate a steady source of cash from automobile data, digital innovation is required. To stay ahead in a highly competitive market, automakers are concentrating on creating new monetization mechanisms and improving software deployment capabilities. Connected automobiles and data monetization is increasingly becoming an element of transportation and automobile systems, and this trend is projected to continue.
• To assess the performance of their products, automotive manufacturers examine massive amounts of data. This will aid in developing future vehicle models, making them safer, more efficient, and more reliable. Original Equipment Manufacturers (OEMs) use data provided by connected cars to build more inventive features that fulfill vehicle drivers' functional and emotional needs—knowing which vehicles are likely to fail and when can help OEMs a lot. Real-time data from automobile sensors can help detect problems early on, and predictive analytics can help companies recall products that may cause difficulties. However, a low adoption rate is a key factor hampering the market's growth.
• The COVID-19 crisis negatively influenced the market. Although it was less severe, it reduced car purchases by lowering the sales volume. Potential defaults on vehicle loans due to job losses and business and market contraction also hurt the market's financial performance.

Key Market TrendsInsurance and Predictive Maintenance to Drive the market

• Banking, Financial Services, and Insurance (BFSI) companies are some of the major investors and adopters of data monetization techniques. The industry is highly focused on generating revenue by leveraging data. Almost 40% of drivers agree that insurance firms should allow safe drivers to pay less for their coverage. Automotive insurance firms can use connectivity services to track driver behavior and performance. Finally, insurance companies will be able to reward safe and responsible drivers by cutting their premiums.
• The PAYD and PYHD are two other usage-based insurance concepts that are gaining traction. Pay-as-you-drive (PAYD) automobile insurance is a cost-effective option for drivers who don't drive frequently. On the other hand, pay-how-you-drive (PYHD) insurance policies consider moving ability when determining premiums. If the user is a cautious driver who uses the brakes gently and follows the speed limit, they will be classified as a skilled driver, implying lower premiums. Insurance firms will look for automobile data when the PAYD and PYHD enter the market and acquire user acceptability, boosting the market.
• Predictive maintenance is used by businesses with high-value assets, such as fleet management companies, to assist in controlling the rising costs of maintaining their equipment. Predictive maintenance software collects data and monitors the condition and performance of in-service equipment, such as a fleet of vehicles, to reduce the risk of failure. Fleet managers may readily predict impending breakdowns by analyzing data from various sensors deployed on trucks and other fleet vehicles.
• Car data can reduce breakdown risk/downtime with predictive maintenance, concierge services can make mundane tasks (such as car washing and refueling) a breeze, and networked infotainment can give easy-to-access entertainment. These features can also save consumers a lot of time.
• Finally, clients who agree to receive in-car advertising and exchange information with insurers may be able to save money at the moment of sale and on their insurance rates. Customers who participate in automatic payment schemes may be able to save money on tolls or municipal road-related levies.

Asia Pacific Account for fastest growing Market

• Due to the rising use of complex and smart automobile technologies in Japan and China, the Asia Pacific automotive data monetization market will likely rise rapidly over the forecast period. In China, 4G connected cars accounted for almost 95% of all related car sales in 2020. The market in the region is likely to continue to rise due to strong demand from China.
• The region is witnessing the advanced and dynamic adoption of new technologies. Additionally, the commercialization of AI, big data, and IoT technologies and the need for further advancements to leverage such technologies will likely drive the adoption of data monetization tools and services in the region.
• According to SAS, 60% of Asia Pacific organizations name customer experience as a key reason to invest in big data. 54% of Asia Pacific organizations invest in big data to achieve product/service innovation.
• According to the International Energy Agency, new electric car registrations were lower than the overall car market in the first half of 2020. The pattern shifted in the second half when China managed to contain the pandemic. BEVs accounted for almost 80% of all new electric vehicles registered in China.
• Indian-based Infosys, one of the vendors in the market, has been accredited as a partner with the Google Cloud Platform Partner Program in the data analytics specialization space. In January 2021, Infosys announced that it achieved elite status in the Snowflake Partner Network. Along with Snowflake, Infosys would offer transformational solutions for enterprises built on Snowflake's Data Cloud, which includes the hyperdata economy for enterprises, proven industry and business solutions, and managed cloud consumption solutions from the Infosys Cobalt portfolio.
• Infosys' POV on the hyperdata economy opens new possibilities for businesses to connect unconnected data across industry boundaries while monetizing their data to draw actionable business insights, build new solutions, explore new business models, and create a connected customer experience. Snowflake enables secure data exchange with strong yet flexible processes for operations ranging from data consumption to monetization.

Competitive Landscape

The global automotive data monetization market is highly concentrated, with a limited number of small and medium-sized companies accounting for most market shares and revenues. Established countries are involved in various research and development activities and initiatives in the automotive data monetization market to create and deploy new and more efficient technologies and solutions. IBM, Oracle, Microsoft, and others are some of the leading competitors in this sector.

• September 2021 - Honda Motor has started a new business that sells data produced by smart cars, joining many competitors in a new sector expected to be valued at up to USD 400 billion annually. Honda has started giving business establishments access to its driving information on around 3.7 million vehicles.
• April 2021 - Ford Motor Company introduced its "Power-Up" over-the-air update capability to make slight improvements to its trucks and cars, intending to roll out 33 million vehicles by the end of 2028. The new system would collect data on millions of commercial and consumer customers, allowing automakers to generate cash.
• January 2021 - Infosys announced its elite status in the Snowflake Partner Network. Along with Snowflake, Infosys would offer transformational solutions for enterprises built on Snowflake's Data Cloud, which includes the hyperdata economy for enterprises, proven industry and business solutions, and managed cloud consumption solutions from the Infosys Cobalt portfolio.

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