South Korea connected cars market size was valued at USD 4.1 billion in 2022, expected to reach USD 9.2 billion in 2030, with a CAGR of 10.65% for the forecast period between 2023 and 2030. The South Korean connected cars market is experiencing rapid growth and innovation due to various market drivers. Smart cars with advanced connectivity technologies enable seamless communication with external devices, networks, and infrastructure. South Korea's technological prowess and robust automotive industry have made space in the South Korean connected cars market. Demand for advanced features and connectivity in vehicles is driving the market growth, with tech-savvy consumers seeking smart and connected solutions that enhance driving experiences, demanding safety features and convenient services.
South Korea's government is driving the connected cars market through smart transportation and smart city initiatives, offering incentives and subsidies to reduce traffic congestion and improve road safety. Collaborations between automotive manufacturers and tech companies have led to advanced connected car technologies like artificial intelligence and autonomous driving. The emergence of 5G technology is set to revolutionize the market, enabling real-time data transmission, autonomous driving, predictive maintenance, and personalized services.
For instance, in January 2023, LG Uplus Corp., the third-largest mobile carrier in South Korea, agreed to provide exclusive wireless communication services to Hyundai Motor Group for its connected cars.
EVs to Boost Market's Growth
The South Korean connected cars market is poised for substantial growth, primarily propelled by the increasing adoption of electric vehicles (EVs). As the global automotive industry embraces eco-friendly solutions, EVs have garnered significant popularity due to their reduced emissions and decreased reliance on fossil fuels. EVs rely heavily on connectivity for features like remote monitoring, battery management, and over-the-air updates, so there is a burgeoning demand for connected car solutions. South Korean consumers' growing interest in EVs and enthusiasm for innovative in-car technologies are driving manufacturers to develop more advanced and interconnected vehicles. This trend offers fertile ground for expanding the connected cars market in South Korea, presenting fresh opportunities for innovation and market penetration.
For instance, in 2023, Toyota introduced its PROACE Verso M 50 kWh, a vehicle designed to offer eco-friendly and efficient transportation. It boasts a spacious and adaptable interior to accommodate both passengers and cargo. With its electric powertrain, the PROACE Verso M 50 kWh aims to deliver a sustainable and comfortable driving experience, aligning with the evolving preferences of environmentally conscious consumers.
Growing Demand for Advanced Safety Features
The market is experiencing a surging demand for innovative safety features, which is driving the widespread adoption of smart and interconnected vehicles in the South Korea market. As safety takes center stage in consumers' driving priorities, there's a growing desire for vehicles equipped with state-of-the-art safety technologies capable of accident prevention and occupant protection. Connected cars offer a comprehensive suite of safety features, including collision avoidance systems, lane departure warnings, adaptive cruise control, and automated emergency services, contributing to overall road safety enhancement.
The collaboration between connectivity and advanced safety features enables real-time data exchange, empowering vehicles to communicate with each other and infrastructure, thereby minimizing potential hazards on the road. This heightened awareness of the tangible benefits these safety technologies offer propels market growth as South Korean consumers enthusiastically embrace connected cars for a safer and more secure driving experience. The trend toward advanced safety solutions is set to continue shaping the South Korean automotive landscape, paving the way for a safer and technologically sophisticated driving future.
Growing Popularity of Infotainment and Telematics Services
The South Korean connected cars market is witnessing the growing popularity of infotainment and telematics services, driving the demand for smart and interconnected vehicles. Consumers increasingly seek in-car entertainment options and connectivity solutions to stay connected while on the move. Infotainment systems offer many features, including multimedia streaming, smartphone integration, voice control, and access to various apps and services. Furthermore, telematics services provide real-time information about the vehicle's performance, location, and diagnostics, enabling better vehicle management and maintenance.
Integrating infotainment and telematics services in cars has made them more appealing to South Korean consumers. Automotive manufacturers are now prioritizing these solutions, driving the market growth in the country. Hyundai's IONIQ 6 model, launched in 2023, offers a seamless, connected driving experience with multimedia streaming, smartphone connectivity, and voice control. Telematics services provide real-time vehicle information, diagnostics, and location tracking, aiming to provide a technologically advanced and enjoyable driving journey.
Impact of COVID-19
The pandemic significantly impacted the connected cars market in South Korea. With the outbreak, the automotive industry faced disruptions in supply chains, production slowdowns, and a decline in consumer demand. As people were confined to their homes during lockdowns, the need for personal transportation decreased, affecting the sales of connected cars. Economic uncertainties and job losses also led to decreased purchasing power, further dampening the market. However, the pandemic highlighted the importance of connected technologies in ensuring safer and more efficient transportation. As South Korea gradually recovers and adapts to the new normal, the connected cars market is expected to bounce back, driven by the growing emphasis on smart mobility solutions and the integration of advanced vehicle technologies.
Impact of Russia-Ukraine War
The Russia-Ukraine war has indirectly impacted the connected cars market in South Korea. The conflict has resulted in economic uncertainties and disruptions in global supply chains. South Korea, a major exporter of automotive components and vehicles, has felt the repercussions of these disruptions. The increased volatility in international markets, coupled with rising energy prices has created an atmosphere of caution and instability, affecting consumer confidence and spending patterns. As a result, the demand for connected cars in South Korea have experienced a slowdown due to the uncertain economic environment. Additionally, the war had the potential to disrupt global trade flows and increase geopolitical risks, which could further impact the market's recovery and growth in the long term.
South Korea Connected Cars Market: Report Scope
South Korea Connected Cars Market Assessment, Opportunities and Forecast, 2016-2030F” is a comprehensive report by Markets and Data, providing in-depth analysis and qualitative quantitative assessment of the current state of the South Korea Connected Cars Market, industry dynamics, and challenges. The report includes market size, segmental shares, growth trends, COVID-19 and Russia-Ukraine war impact, opportunities, and forecast between 2023 and 2030. Additionally, the report profiles the leading players in the industry, mentioning their respective market share, business model, competitive intelligence, etc.
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