Global Artificial Intelligence in Tranportation Market size is forecast to reach $3,870 million by 2025, estimated to grow at a CAGR of 15.8% during 2020-2025. The rapid use of machine learning technology for product innovation such as self-driving cars, parking and lane-change assists, and smart energy systems are highly fueling the AI in transportation market. Furthermore, the growing need for advanced transportation planning, driver behavior, data management, traffic signaling and so on are surging the growth of the market. These significant factors are therefore, fueling the growth of AI in transportation market during the forecast period 2020-2025.
Application – Segment Analysis
Autonomous Trucks held the largest market share in the AI in Transportation market in 2019. The growing development in the trucking industry are further enhancing the demand for autonomous trucks. In addition, the growth of logistics industry in the US for the transportation of goods are driving the need for autonomous trucks. It is also estimated that more than 65% of the goods are transported through trucks globally which is thus surging the growth of this application.. The deployment of autonomous trucks will also result in lowering the maintenance and administration expenses to about 45%. These key factors will thus drive the demand for artificial intelligence in transportation industry thus, providing flawless self-driving and safety to the passenger.
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Geography – Segment Analysis
In 2019, North America dominated the AI in Transportation market with a share of more than 45%, followed by Europe and APAC. The use of automated cars and the growing integration of self-driving vehicles onto the US roadways are highly accelerating the growth of the market in this region. Furthermore, the US transportation and logistics industry is highly driving the spread of AI-based self-driving trucks for reduced operational costs which is fostering the growth of the market in North America.
Drivers – AI in Transportation Market
Growth of Traffic Management
Most of the cities are using advanced technologies for robust traffic management that include the sensors and cameras integrated everywhere on the road. These devices carry huge amount of data about the traffic details that requires enhanced analysis. Thus, the data collected is sent to the cloud where data is analyzed and revealed with the help of AI-powered system. Thus, the growing need to analyze and predict the data collected through enhanced traffic management will further propel the AI in transportation market.
Deployment of Self-driving Vehicles
The rising demand for self-driving vehicles or autonomous vehicles has enhanced the transportation sector which is further driving the AI in transportation market. Moreover, the increasing deployment of autonomous vehicles for public transportation with low cost services will further boost the integration of AI technology. Therefore, the rising need to provide public safety and low cost transportation will lead to enhance the AI technology in transportation market.
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Challenges – AI in Transportation Market
Operating and Integrating Cost
The AI-based systems are majorly cloud-based which requires expensive bandwidth in order to provide power to the system. Also, as this is a new technology solution which requires enhanced training and skills which incurs high cost. These significant challenges leads to high operating cost of AI while using in transportation. Furthermore, the AI-operated machines include network of individual processers, relays, and other components which require time-to-time maintenance and replacement, and huge amount of energy to operate which leads to high cost of operation. These challenges highly impacts the growth of the artificial intelligence in transportation market.
Technology launches, acquisitions and R&D activities are key strategies adopted by players in the AI in Transportation market. In 2019, the market of AI in Transportation has been consolidated by the major players – Alphabet Inc, Robert Bosch Gmbh, Continental AG, Daimler AG, Intel Corporation, Magna International, Microsoft Corporation, Nauto, Nvidia and Volvo Group
In July 2020, Microsoft China announced strategic partnership with Human Horizons, an innovative mobility company for jointly developing an on-board AI assistant, HiPhiGo, for Human Horizons’ premium smart all-electric vehicles, HiPhi. HiPhi1. The production of the first product of the HiPhi brand will end by 2020, and deliveries will start by 2021.
In December 2019, Nvidia and DiDi Chuxing (DiDi), amongst the world’s leading mobile transportation platform provider announced that DiDi leveraged Nvidia GPUs and AI technology for developing autonomous driving and cloud computing solutions.
In 2019, the AI in transportation market was dominated by North America owing to the development in the US logistics and transportation industry which has raised the demand for autonomous trucks.
The increasing use of technology for traffic management has led to the need for AI in order to analyze and predict large amount of voluminous traffic details which will thus surge the AI in transportation market.
The rising demand for self-driving vehicles such as autonomous trucks for enhancing the logistics industry are significantly fueling the need for AI in transportation market.
The high operational cost for the integration of artificial intelligence components and parts in the vehicles are highly hindering the growth of the market.
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