The automotive system simulation software market is projected to reach US$ 2,616.37 million by 2028 from US$ 1,142.52 million in 2021; it is expected to grow at a CAGR of 12.6% from 2021 to 2028.
System simulation or modeling enables users to solve real-world problems safely and efficiently. Simulation is used across multiple industries and disciplines to provide clear insights into complex systems. With the rapid increase in the production of new vehicles, OEMs are shifting their conventional prototyping methods toward automotive system simulation to develop new models and improve existing ones, which is driving the automotive system simulation software market. Furthermore, advancements in simulation technologies have enabled automobile manufacturers to use a digital twin approach to accelerate the prototyping processes and make them cost-efficient. Automotive system simulation software plays a crucial role in the research and development process of all types of automobiles, including trucks, cars, buses, and two-wheelers. The software remarkably helps in cutting vehicle emissions and improving fuel efficiency. For instance, Daimler AG, a German automaker, announced the allocation of ~US$ 78.75 billion for its 2021–25 business plan focused on electrification and digitization. The investment will help it accelerate its goal of transitioning toward zero-emission products. Similar trends are expected in the automotive system simulation software market in the near future, as developers focus on R&D and product innovation. As a result, simulation technologies for the automotive sector, which have grown tremendously over time, will become even more advanced and powerful.
The current rate of re-engineering of vehicles and their components to tweak their weight, electrification, and energy efficiencies and to incorporate improved, smart control systems has compelled engineers to adopt virtual prototyping and testing, hence resulting in the adoption of automotive system simulation software. Since simulation replicates any systems and creates its valid digital representation it avoids the creation of scale copy. It is modeled digitally on a computer through algorithms and equations. ESI Group offers salient multi-physics simulation software to design and evaluate conventional, electric, and hybrid drive systems—including thermal management, battery management, transmission management, and others—thereby defining their operating strategies. Improvements in vehicle functionality and system components have led to a rise in the complexity of system architectures, such as electrical/electronic (E/E) architecture. Thus, the growing complexities of vehicle architectures with the rising number of functionalities are driving the growth of the automotive system simulation software market. Bosch has developed a modular control unit kit that enables the efficient scaling of an E/E platform across different vehicle models that need to undergo sufficient simulation before testing and prototyping.
As governments across the world are imposing stringent regulations and policies to limit the environmental impact of automobile emissions and boost the adoption of electric vehicles, there is a sudden spike in the sales of electric and hybrid vehicles. Consequently, automotive giants are rigorously engaging in the research and development, and production of electric vehicles. Testing vehicle performances through automotive system simulation software forms a major part of these activities.
Based on type, the automotive system simulation software market has been segmented into transmission, engine, electric propulsion, fuel cell, driveline, chassis, and others. Based on vehicle type, the automotive system simulation software market has been segmented into commercial vehicles and passenger cars. Based on propulsion type, the automotive system simulation software market has been segmented into ICE and electric.
IMPACT OF COVID-19 PANDEMIC ON AUTOMOTIVE SYSTEM SIMULATION SOFTWARE MARKET
The COVID-19 crisis had a cascading impact on the global automotive industry since its inception in China, where sales dropped down by 71% in February 2020; and subsequently, by April, sales declined by 47% in the US and crashed by a staggering 80% in Europe. This lowered the market demand as requirement from major automotive manufacturers has declined. However, as the supply chain started regaining some strength from the third quarter of 2020 through the second quarter of 2021, automakers have witnessed a steady rise in the production levels. Furthermore, the crisis has brought rapid transformation across the mobility value chain and accelerated the digitization process occurring prior to it. Although the pandemic-related restrictions had led to prolonged or periodic shutdowns of production lines, non-manufacturing processes have continued to be attended by employees with secure connections through work-from-home or remote work model. The use of automotive system simulation solutions has greatly assisted the production and research of automakers during the crisis since product development process could be continued with limited or no access to laboratories and other physical validation equipment.
Lucrative Regions for Automotive System Simulation Software Market
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Market Insights – Automotive System Simulation Software Market
Upgrading of Vehicle Functions and Increase in Number of E/E Components Drives Market Growth
The automotive sector is continuously working on offering enhanced functionalities in vehicles, with a major focus on automated driving, advanced infotainment, safety technologies, etc. Incorporating electronic components related to these functionalities is catalyzing the evolution of the topology of systems, hardware, and software, thereby creating a dynamic electrical/electronic vehicle system architecture (E/E architecture). For example, Continental introduced the body high-performance computer (HPC), a central hub between a vehicle and the digital world, to create an effective service-oriented vehicle system architecture. Furthermore, a shift from primary vehicle domain architectures toward E/E architectures high-performance servers and zone system simulation software is creating a high demand for automobile system simulation software to ensure the efficiency of the architecture during the design and development stage. These software products enable new, cost-effective vehicle testing compared to conventional testing methods.
Automotive System Simulation Software Market
– by Type
Based on type, the automotive system simulation software market has been segmented into transmission, engine, electric propulsion, fuel cell, driveline, chassis, and others. The engine segment dominates the automotive system simulation software market as there is major demand for the engine system simulation software to develop fuel-efficient engines. Increasing government norms foe controlling emission levels and surge in focus on enhancing fuel efficiencies drive the market growth for this segment.
Automotive System Simulation Software Market
– by Vehicle Type
Based on vehicle type, the automotive system simulation software market has been segmented into commercial vehicles and passenger cars. The passengers cars segment dominates the market due to continuous developments in vehicle dynamics, engines, and power systems. Commercial vehicles is also growing at significant pace across the globe owing growing industrialization.
Automotive System Simulation Software Market
– by Propulsion Type
Based on propulsion type, the automotive system simulation software market has been segmented into ICE and electric. The ICE propulsion type segment dominates the automotive system simulation software market. The demand for these software systems is growing for developing advanced ICEs meeting new emission norms with enhanced efficiencies. However, the rising demand for electric propulsion is creating lucrative opportunities for the electric segment, and thus, this segment is expected to register with a higher CAGR in automotive system simulation software market during the forecast period.
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Automotive System Simulation Software Market: Strategic Insights
Market Size Value in US$ 1,142.52 million in 2021 Market Size Value by US$ 2,616.37 million by 2028 Growth rate CAGR of 12.6% from 2021 to 2028 Forecast Period 2021-2028 Base Year 2021
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Automotive System Simulation Software Market: Strategic Insights
| Market Size Value in | US$ 1,142.52 million in 2021 |
| Market Size Value by | US$ 2,616.37 million by 2028 |
| Growth rate | CAGR of 12.6% from 2021 to 2028 |
| Forecast Period | 2021-2028 |
| Base Year | 2021 |
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Players operating in the automotive system simulation software market are mainly focused on the development of advanced and efficient products.
- In January 2022, EasyMile, an all-electric autonomous technology supplier headquartered in Toulouse, France, procured Ansys software for a single-source, turnkey solution to demonstrate the safety of their driverless vehicles.
- In April 2021, Simul8 won a Silver Award for Most Valuable Corporate Response at the Stevie Awards for Women in Business.
Report Coverage
Revenue forecast, Company Analysis, Industry landscape, Growth factors, and Trends
Segment Covered
Type, Vehicle Type, and Propulsion Type
Regional Scope
North America, Europe, Asia Pacific, Middle East & Africa, South & Central America
Country Scope
Argentina, Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, Mexico, Russian Federation, Saudi Arabia, South Africa, South Korea, United Arab Emirates, United Kingdom, United States
Frequently Asked Questions
A significant impact of the transportation sector on the environment has created an unprecedented need for the decarbonization of automobiles worldwide to limit global warming by 2030, leading to a massive surge in the adoption of low-carbon-emitting technologies in this sector. The consequent shift in consumer perception toward near-zero-emission vehicles has significantly propelled the production and sales of light-duty electric vehicles (EVs) across the world, especially in stable economies, such as the US, China, and European Union countries. Therefore, the booming electric vehicle market, coupled with the essentiality of simulation platforms in EV development and production, is bolstering the growth of The automotive system simulation software market.
The automotive sector in Asia Pacific is flourishing continuously. Vehicle manufacturing is one of the most prominent contributors to the GDP of many countries in the region. China, the largest producer as well as consumer of cars, saw a 135% rise in the demand for new-energy vehicles (NEV) as the shipment reached 383,000 units in October 2021. Moreover, leading companies in this sector invest strategically in research and development activities, and expansions. Therefore, the booming automotive sector in several strong economies of Asia Pacific is creating solid opportunities for The automotive system simulation software market growth.
The engine segment led the automotive system simulation software market with a share of more than 25% in 2020 and its anticipated to dominate over the forecast period. The simulation software for engine testing is applied for the prediction of engine performance parameters, including power, torque, airflow, turbocharger performance and matching, volumetric efficiency, fuel consumption, and pumping losses.
Europe dominated the automotive system simulation software market in 2020 with a share of more than 30% and is expected to hold second leading position by 2028.
The major companies in automotive system simulation software includes ESI Group; ANSYS, Inc; Hexagon AB; dSPACE GmbH; and Siemens.
The passenger cars segment led the automotive system simulation software market with a share of more than 70% in 2020.
The List of Companies - Automotive System Simulation Software Market
- ESI Group
- ANSYS, Inc
- Hexagon AB
- dSPACE GmbH
- Siemens
- Modelon
- IPG Automotive GmbH
- Realtime Technologies
- Gamma Technologies, LLC
- SimScale GmbH
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- Data Collection and Secondary Research:
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The primarily interview analysis comprise of data obtained from industry participants interview and answers to survey questions gathered by in-house primary team.
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Below is the breakup of our primary respondents by company, designation, and region:
Once we receive the confirmation from primary research sources or primary respondents, we finalize the base year market estimation and forecast the data as per the macroeconomic and microeconomic factors assessed during data collection.
- Data Analysis:
Once data is validated through both secondary as well as primary respondents, we finalize the market estimations by hypothesis formulation and factor analysis at regional and country level.
- 3.1 Macro-Economic Factor Analysis:
We analyse macroeconomic indicators such the gross domestic product (GDP), increase in the demand for goods and services across industries, technological advancement, regional economic growth, governmental policies, the influence of COVID-19, PEST analysis, and other aspects. This analysis aids in setting benchmarks for various nations/regions and approximating market splits. Additionally, the general trend of the aforementioned components aid in determining the market's development possibilities.
- 3.2 Country Level Data:
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- 3.3 Company Profile:
The “Table of Contents” is formulated by listing and analyzing more than 25 - 30 companies operating in the market ecosystem across geographies. However, we profile only 10 companies as a standard practice in our syndicate reports. These 10 companies comprise leading, emerging, and regional players. Nonetheless, our analysis is not restricted to the 10 listed companies, we also analyze other companies present in the market to develop a holistic view and understand the prevailing trends. The “Company Profiles” section in the report covers key facts, business description, products & services, financial information, SWOT analysis, and key developments. The financial information presented is extracted from the annual reports and official documents of the publicly listed companies. Upon collecting the information for the sections of respective companies, we verify them via various primary sources and then compile the data in respective company profiles. The company level information helps us in deriving the base number as well as in forecasting the market size.
- 3.4 Developing Base Number:
Aggregation of sales statistics (2020-2022) and macro-economic factor, and other secondary and primary research insights are utilized to arrive at base number and related market shares for 2022. The data gaps are identified in this step and relevant market data is analyzed, collected from paid primary interviews or databases. On finalizing the base year market size, forecasts are developed on the basis of macro-economic, industry and market growth factors and company level analysis.
- Data Triangulation and Final Review:
The market findings and base year market size calculations are validated from supply as well as demand side. Demand side validations are based on macro-economic factor analysis and benchmarks for respective regions and countries. In case of supply side validations, revenues of major companies are estimated (in case not available) based on industry benchmark, approximate number of employees, product portfolio, and primary interviews revenues are gathered. Further revenue from target product/service segment is assessed to avoid overshooting of market statistics. In case of heavy deviations between supply and demand side values, all thes steps are repeated to achieve synchronization.
We follow an iterative model, wherein we share our research findings with Subject Matter Experts (SME’s) and Key Opinion Leaders (KOLs) until consensus view of the market is not formulated – this model negates any drastic deviation in the opinions of experts. Only validated and universally acceptable research findings are quoted in our reports.
We have important check points that we use to validate our research findings – which we call – data triangulation, where we validate the information, we generate from secondary sources with primary interviews and then we re-validate with our internal data bases and Subject matter experts. This comprehensive model enables us to deliver high quality, reliable data in shortest possible time.
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