Market Trends of Automotive Voice Recognition System Industry
Passenger Cars Segment to Gain Traction During the Forecast Period
Customers increasingly prefer to purchase a car with advanced connectivity features rather than the mechanical specifications of the vehicle because they demand driving comfort and convenience more than the outright power or torque figures. This trend is increasingly observed in major automotive markets worldwide, which has led to an increase in the demand for features like in-vehicle voice recognition systems.
- According to the International Organization of Motor Vehicle Manufacturers (OICA), new passenger vehicle sales worldwide touched 57.4 million units in 2022 compared to 56.4 million units in 2021, representing a Y-o-Y growth of 1.9%.
Further, the demand for voice recognition systems is being accelerated by the rising sales of connected cars and autonomous vehicles. Both connected as well as autonomous vehicles have voice recognition technology as a standard feature. Voice recognition systems have been seen to reduce the number of vehicle accidents since they free drivers from basic, routine tasks so they can fully concentrate on driving. Luxury and premium passenger cars offered by various automakers, such as Mercedes, BMW, and Audi, are rapidly integrating advanced voice recognition systems in their vehicles to gain a competitive edge in the industry, which, in turn, is positively impacting the surging demand for this segment of the market.
- In 2022, BMW, Mercedes-Benz, and Audi were the leading automakers with the highest luxury vehicle sales worldwide. BMW registered sales of 2.4 million units of luxury vehicles, followed by 2.07 million units by Mercedes-Benz and a sales volume of 1.61 million units by Audi in 2022.
Thus, increasing sales of connected and autonomous vehicles, the trend toward greater vehicle safety, and the availability of voice recognition systems in mid-priced vehicles like family sedans and compact SUVs are some of the factors anticipated to drive the market in the forecast period.
Asia-Pacific Expected to be the Fastest-growing Regional Market During the Forecast Period
The Asia-Pacific is expected to be the fastest-growing regional market, followed by North America and Europe. Asia-Pacific is a huge market for passenger vehicles. India and China are some of the largest markets for passenger vehicles in the world, contributing to almost 30% of the global passenger vehicle sales, thus making Asia-Pacific the most lucrative regional market for automotive voice recognition systems.
- According to the Society of Manufacturers of Electric Vehicles, electric four-wheeler sales touched 48,105 units in FY 2023 compared to 19,782 units in FY 2022, representing a Y-o-Y growth of 143.1%.
- According to the Japan Automobile Dealers Association, in October 2023, the new vehicle market in Japan made a strong recovery, with sales rising by 10.7% to 397,672 units from 359,159 units in October 2022.
Major auto manufacturers in Asia-Pacific countries are increasingly preferring to integrate advanced solutions in their vehicles to enhance customers' convenience. The incorporation of artificial intelligence and virtual assistant-enabled voice recognition systems in their vehicle fleets is among the innovative technological features that these players are relying on. Major automakers are forming long-term partnerships with voice recognition system suppliers and are investing hefty sums in the development of advanced voice recognition systems that can cater to the increasing demand. For instance,
- In November 2023, Renault Korea Motors announced that it had signed a memorandum of understanding (MOU) with Tmap Mobility Co. for future infotainment collaboration. As part of the new car development project "Aurora Project," Renault Korea plans to equip the mid-size hybrid sports utility vehicle (SUV) with "Tmap Infotainment," which is capable of providing in-car voice recognition "NUGU Auto," Tmap Store, in-car easy payment, and electric vehicle-specialized services.
- In April 2023, Cerence Inc. announced that Chinese smart car supplier Banma had tapped Cerence to bring advanced in-car conversational AI and voice recognition technology to Banma’s automaker customers, including Shanghai Volkswagen Automotive Co. (SVW) and FAW-Volkswagen (FAW-VW). Cerence’s flagship conversational AI enables in-car assistants to function as proactive, trusted co-pilots, leading drivers through their daily journeys while staying safe, informed, and comfortable.
Thus, with rapid advancements and innovations in this segment, the market for automotive voice recognition systems is expected to grow over the forecast period for both the commercial and passenger vehicles segment across Asia-Pacific countries.
