---

Market Overview

---

The automotive cybersecurity market experienced a valuation of $2.76 billion in 2022 and is projected to grow at a CAGR of 22.97%, reaching $17.73 billion by 2031. This growth can be attributed to various factors, including the increased utilization of electronics per vehicle, the rising number of connected vehicles, the growing cyber threats resulting from increased data and connectivity in vehicles, and the surge in electric vehicle sales.

The expansion of the connected vehicle ecosystem is rapidly progressing, with emerging connectivity technologies propelling vehicles into the era of IoT-based software-defined vehicles. While these connectivity technologies offer numerous benefits, they also introduce new threats. The heightened connectivity of a vehicle’s central control module has rendered vehicles more susceptible to cyber attacks, jeopardizing safety and security. Manufacturers must prioritize safeguarding confidential information and critical safety systems. They need to anticipate and prevent hackers from gaining access to embedded systems and vehicle data. Furthermore, automotive industry associations and regulatory bodies should develop standards, specifications, and guidelines for vehicle cybersecurity that foster interoperability.

Connectivity brings forth an array of connected services, innovative features, and revenue streams for both automobile manufacturers and cybersecurity solution providers. However, the increasing number of electronic control units (ECUs) per vehicle, advancements in technology, and internet connectivity expose vehicles to exponential levels of complexity and vulnerability. Features such as automated driving, remote diagnostics and software updates over the air, emergency calling in case of accidents, satellite connectivity, internet services, in-car payment options, remote control via mobile apps, and connected infotainment integrating traffic information have expanded the attack surface for potential cyber threats.

The automotive cybersecurity market is driven by various factors, including the rising number of ECUs in electric vehicles to enhance performance and sophistication, the escalating frequency of cyber attacks within the automotive industry, and the growing adoption of connected and autonomous vehicles.

Automotive cybersecurity solution providers are collaborating with key stakeholders and making significant investments in the development of advanced cybersecurity solutions to mitigate the increasing number of cyber attack vectors. As automotive OEMs prioritize vehicle security, the automotive cybersecurity market is expected to experience significant growth in the coming years.
The automotive cybersecurity market is influenced by several demand drivers. There is an increase in the use of electronics per vehicle, coupled with a growing number of connected vehicles. As automobiles become more technologically advanced, incorporating a higher number of electronic components and connectivity features, the need for robust cybersecurity measures becomes paramount. The rise in cyber threats is another significant driver. With the increasing amount of data generated and transmitted by vehicles, as well as the expanding connectivity options, the vulnerability to cyber attacks escalates. This necessitates the implementation of effective cybersecurity solutions to safeguard against unauthorized access and malicious activities. The sales of electric vehicles contribute to the demand for automotive cybersecurity. As the adoption of electric vehicles continues to grow, so does the importance of securing their intricate electronic systems. The unique characteristics and complexities of electric vehicles require specialized cybersecurity measures to ensure their safe operation and protect sensitive data.

However, the automotive cybersecurity market also faces several challenges. The first challenge is the growing complexity and the escalating number of electronic components integrated into vehicles. The proliferation of advanced features and technologies amplifies the attack surface for potential cyber threats, making it increasingly challenging to implement comprehensive security measures. The financial impacts resulting from vulnerabilities and the motivation of cyber hackers present another challenge. Cyber attacks can lead to significant financial losses for automotive manufacturers, as well as damage to their reputation and customer trust. The increasing motivation of hackers further exacerbates this issue, as they continually seek new ways to exploit vulnerabilities and gain unauthorized access to vehicle systems. Furthermore, the automotive cybersecurity market operates within a highly complex ecosystem, involving multiple stakeholders. This complexity arises from the collaboration between automotive manufacturers, cybersecurity solution providers, government entities, regulatory bodies, and industry associations. Coordinating efforts and aligning interests among these various stakeholders can pose challenges in establishing standardized cybersecurity practices and achieving effective collaboration. Addressing these challenges requires concerted efforts from all stakeholders involved, including the development of robust cybersecurity solutions, investment in research and development, adherence to regulatory standards, and fostering collaboration within the industry.

---

Market Segmentation

---

The market is segmented based on various factors, including application, vehicle type, level of autonomy, security type, form, and region.

Segmentation by Application
Communication
Advanced Driver Assistance System (ADAS) and Safety System
On-Board Diagnostic (OBD)
Infotainment
Telematics
EV Charging Station
Others

Segmentation by Vehicle Type
Passenger Vehicle
Commercial Vehicle

Segmentation by Level of Autonomy
Level 1
Level 2
Level 3
Level 4
Level 5

Segmentation by Security Type
Network Security
Software Security
Cloud Security
Hardware Security

Segmentation by Form
In-Vehicle
External Cloud Services

Segmentation by Region
North America
Europe
U.K.
China
Asia-Pacific and Japan
Rest-of-the-World

The global automotive cybersecurity market in 2021 was dominated by the ADAS and safety system segment, driven by the increasing use of ADAS in mid and high-end vehicles. ADAS and safety systems play a crucial role in partially and fully autonomous vehicles, making them a priority for automotive original equipment manufacturers (OEMs) to enhance user safety. However, these systems are vulnerable to cyber-attacks, necessitating the demand for cybersecurity solutions.

In terms of vehicle type, passenger vehicles held the majority share in the automotive cybersecurity market in 2021. This can be attributed to the rapid adoption of cybersecurity solutions in passenger cars to ensure vehicle security. The increasing integration of connected technologies in passenger vehicles has also contributed to their dominance in the market. Automotive OEMs are actively working on developing and offering cybersecurity solutions independently or in collaboration with other industry stakeholders to meet the needs of the passenger vehicle category.

Regarding the level of autonomy, the Level 2 segment held the largest market share in 2021. The rising demand for vehicles with Level 2 autonomy has fueled the need for automotive cybersecurity solutions. As automotive OEMs continue to focus on offering vehicles with partial automation, particularly ADAS, cybersecurity solution providers are concentrating on developing solutions for vehicles at Level 2 autonomy.

The software security segment emerged as the dominant sector in the global automotive cybersecurity market in 2021. This is due to the growing emphasis on software-defined vehicle approaches by automotive OEMs and the increasing vulnerability of software solutions used in vehicles to cyber-attacks. Software security solutions primarily address challenges related to vehicle diagnostics, software updates, and data collection and storage. With the significant increase in the number of ECUs in today’s software-driven vehicles, the revenue generated by cybersecurity solutions in the software security segment is expected to witness substantial growth.

In 2021, the in-vehicle automotive cybersecurity solution segment held the largest market share and is projected to maintain its dominance in the forecast period. Currently, the adoption of external cloud services-based automotive cybersecurity solutions is hindered by inadequate infrastructure and consumer preference for in-vehicle solutions. Nevertheless, the demand for external cloud services-based solutions is expected to grow rapidly in the coming years.

Europe held the largest market share in the automotive cybersecurity market in 2021, primarily due to its prominent position in the connected and autonomous vehicle market. The region is home to major players in the automotive cybersecurity market and has implemented automotive cybersecurity regulations, particularly by EU member nations, fostering market growth. These regulations aim to facilitate the development of connected and autonomous vehicles while addressing the associated cybersecurity threats. Europe’s dominance is further reinforced by the increasing adoption of connected vehicles driven by the proliferation of ECUs in vehicles, advancements in vehicle software, and governmental regulations. It is expected that Europe will continue to dominate the automotive cybersecurity market due to its strict regulations for connected vehicle OEMs and its large consumer base for connected vehicles.

---

Competitive Landscape

---

Prominent providers of automotive cybersecurity solutions are engaging in various strategic initiatives, with a primary focus on partnerships and collaborations, with the aim of enhancing their market presence.

The selection of these profiled companies is based on inputs obtained from industry experts, as well as an analysis of their company coverage, product portfolio, and market penetration.

Publicly traded companies in the global automotive cybersecurity market held approximately 60% of the market share in 2021, whereas privately held companies accounted for approximately 40% of the market share.

Key companies profiled in this report include Argus Cyber Security Ltd., ESCRYPT GmbH, Karamba Security, ARILOU Automotive Cybersecurity, Vector Informatik GmbH, Mocana Corporation, Green Hills Software, Irdeto, Lear Corporation, DENSO Corporation, HARMAN International, Broadcom Inc., Garrett Motion Inc., Aptiv PLC, NXP Semiconductors, Synopsys, Inc., Upstream Security Ltd., Guardknox Cyber-Technologies Ltd., C2A-SEC LTD, SafeRide Technologies Ltd., VicOne Inc.

---

Recent Industry Developments

---

In October 2022, Denso Corporation and NTT Communications Corporation announced the joint development of the vehicle security operation center (VSOC) in response to the escalating cyber threats targeting vehicles.

In September 2022, Argus Cyber Security Ltd. and Elektrobit introduced the EB zoneo SwithCore Shield pre-integrated solution, which incorporates intrusion detection and prevention system (IDPS) functionality alongside advanced network management systems, catering to the next generation of vehicles.

In March 2020, ESCRYPT GmbH partnered with the security division of NTT Ltd. to offer collaborative solutions that enhance the cyber resilience of vehicle fleets.

In March 2020, Argus Cyber Security Ltd. collaborated with NXP Semiconductors to launch an integrated solution aimed at safeguarding Ethernet network communications in vehicles. The solution leverages Argus’s Ethernet intrusion detection system (IDS) and NXP’s S32G processor, which provides protection for ADAS, modern service-oriented gateways, and other mobility innovations.

In February 2020, Karamba Security unveiled XGuard 2.0, a self-protection solution embedded within automotive ECUs, intended to safeguard the PikeOS hypervisor.

In January 2018, HARMAN introduced new detection capabilities for the HARMAN SHIELD solution, designed to protect semi-autonomous and autonomous vehicles from cyberattacks targeted at vehicle sensors.

---

Key Questions Answered

---

How is the global automotive cybersecurity market evolving in response to new technologies and products?

What are the significant patents filed by companies actively involved in the automotive cybersecurity market?

What are the perspectives of key industry participants from automotive cybersecurity manufacturing companies operating in this space?

What are the primary development strategies implemented by key players to sustain their presence in the competitive automotive cybersecurity market?

Which region and country serve as the major consumers of automotive cybersecurity?