Growing Consumer Demand for 3D Car Sound Systems and Music-inspired Luxury Cars to Aid Market Growth
The automotive sector has witnessed noteworthy developments over the past couple of decades. While the regulatory landscape continues to drive innovations in terms of engine design, performance, and other technical parameters, the other facets of the automotive sector, including in-car entertainment have also experienced major improvements, particularly in the last decade. Vehicle entertainment has garnered considerable popularity worldwide, as more number of customers are inclined toward installing customized, interactive, and cutting-edge entertainment systems in their vehicles. The dwindling prices of automotive entertainment components is a major factor expected to propel the demand for automotive speakers during the assessment period.
Sensing the growing interest in in-car entertainment, automotive companies are increasingly swaying toward launching vehicles integrated with advanced automotive speakers to cut through the stiff market competition. Consumer trends continue to evolve at a rapid pace due to which, market players are compelled to innovate and introduce products in line with the evolving market and consumer trends. The growing demand for music-inspired luxury cars and 3D car sound systems is another influential factor that is projected to shape the growth of the global automotive speaker market in the upcoming decade.
At the back of these factors, along with the growing emphasis on the development of next-generation automotive speakers, which, in turn, has increased brand partnerships, the global automotive speaker market is set to surpass the value of US$ 9.6 Bn mark by the end of 2030.
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Rapid Innovations in Automotive Speakers Market Set to Increase Demand
Fast-paced advancements across the global automotive speaker market are expected to play an imperative role in driving the market growth. As the in-built automotive technology continues to emerge as one of the most essential unique selling points for automotive companies, more number of auto brands are focusing on integrating advanced technologies into their in-car entertainment systems. Several leading audio companies, including Blaupunkt, HARMAN, Bose, Alpine, and Panasonic, among others, are closely operating with various automotive companies to cater to the growing demand for high-quality car sound systems. In addition, as per analysts at the Transparency Market Research, market players are likely to focus on innovations pertaining to noise cancellation systems, speaker less car audio technology, portable audio technology, and voice-controlled artificial intelligence (AI) entertainment systems to gain a competitive edge in the automotive speaker market landscape.
Moreover, as automotive companies are highly inclined toward improving acoustics inside the modern-day automotive vehicles in comparison with traditional vehicles, the demand for automotive speakers is expected to move in the upward trajectory during the assessment period. Several brands are investing in research & development and product innovation to improve their position in the market. Moreover, as automotive technology evolves, players operating in the global automotive speaker market are also expected to develop products in line with these changes. For instance, with the growing popularity of electric vehicles worldwide, in-car acoustics within electric vehicles varies from that in traditional vehicles due to low engine sound levels, thus driving the demand for noise cancellation in-car audio systems.
HARMAN, one of the leading brands in the global automotive speaker market rolled out the HALOsonic Road Noise Cancellation system to cater to the growing demand for noise cancellation automotive speakers in electric cars. While product innovation is expected to garner momentum, several brands are projected to forge strategic alliances to improve their market presence. For instance, in December 2019, Faurecia announced the partnership with Devialet– a move that is expected to fast track the development of high-quality automotive speakers and audio solutions for various automotive companies.
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COVID-19 Pandemic to Impact Demand for Automotive Speakers in 2020
The COVID-19 pandemic is expected to have a catastrophic impact on the global automotive sector. While the initial lockdown measures in China and several major automotive hubs primarily hindered the growth of the global auto sector, the demand for automotive vehicles has witnessed a drastic decline in 2020 due to the COVID-19 pandemic. As the demand for automotive vehicles continues to drop, along with it, the demand for automotive speakers continues to move in the downward trajectory, especially in the developing regions, thus impacting the expansion of the automotive speaker market.
However, the demand is expected to gain pace toward the last quarter of 2020 or toward the first quarter of 2021.
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Automotive Speaker Market: Overview
- The global automotive speaker market is anticipated to expand at a CAGR of ~4% during the forecast period, owing to an increase in sale and production of luxury vehicles across the globe, which has led to a rise in use of good audio systems in vehicles. This, in turn, is estimated to boost the production of automotive speakers. Rise in consumer trend toward autonomous vehicles is expected to provide significant opportunities for the automotive speaker market across the globe.
- Rise in consumer trend toward onboard infotainment system in public transportation facilities to obtain information about transport details is expected to also offer considerable opportunities for the automotive speaker market across the globe. Increase in use of FM radio systems, Bluetooth speakers while traveling, and increased multiple application of speakers in vehicles is anticipated to boost the automotive speaker market across the globe. Incorporation of technology in passenger vehicles, including advanced safety features with audio systems, is expected to propel the global automotive speaker market.
Drivers of Automotive Speaker Market
- Rise in adoption of onboard infotainment system in passenger and commercial vehicles for improved entertainment while driving and to improve passenger safety is anticipated to propel the automotive speaker market across the globe. Collaboration between original equipment manufacturers and audio system manufacturers to incorporate advanced audio systems in vehicles is likely to boost the automotive speaker market across the globe. Growing consumer trend toward luxury and premium vehicles, owing to an increase in purchasing capacity of buyers across the globe is likely to fuel the automotive speaker market across the globe.
- Increase in awareness among consumers and rise in per capita income have driven consumer preference toward comfort features and vehicle safety. Growing incorporation of artificial intelligence in vehicles is likely to fuel the demand for automotive speakers. Increased integration of smartphones with sound systems through Bluetooth connectivity is anticipated to propel the automotive speaker market. Such sound systems help make phone calls and also change music while driving. Rise in use of voice assistance, including Alexa, Google assistant, and Siri to control through voice commands, is expected to boost the automotive speaker market across the globe. The introduction to autonomous vehicles and growing adoption of ADAS features in vehicles are further driving the automotive speaker market across the globe.
Challenges for Automotive Speaker Market
- Major vehicle manufacturers shutdown their plants due to the COVID-19 pandemic, which led to a decline in vehicle production and sale. Prominent automakers, including GM, Ford, and FCA, under pressure from unions to protect employees and to follow government advisories, decided to idle their plants across the globe. Toyota, Honda, Tesla, and Nissan also announced a temporary suspension of production across the globe, which is a major challenge for the automotive speaker market across the globe.
- Major challenge for automotive speaker is high initial cost of speakers. Vehicles fitted with advanced sound systems increase the overall vehicle cost, which is likely to restrain the global automotive speaker market.
Segmentation of Automotive Speaker Market
- Based on vehicle type, the passenger vehicle segment dominated the global automotive speaker market due to rise in production of passenger vehicles across the globe. Technological development in passenger vehicles to enhance safety features with audio systems is likely to propel the automotive speaker market. Rise in demand for passenger vehicles from ride hailing services, which offer entertainment services, is likely to fuel the automotive speaker market.
- Based on position, the dashboard segment held a major share of the global automotive speaker market. Major vehicle manufacturers prefer the dashboard installed speakers due to an increase in use of voice assistance in vehicles. Speakers in dashboard are easy to install and provide compact space. This is likely to boost the global automotive speaker market.
Automotive Speaker Market: Regional Analysis
- Based on region, the global automotive speaker market has been segregated into North America, Asia Pacific, Europe, Latin America, and Middle East & Africa
- Asia Pacific and Europe are projected to be highly lucrative markets during the forecast period. This is primarily due to the presence of prominent automotive industry in China, Germany, Japan, and India. Growing awareness about safety and comfort features with sound system provides opportunity for the automotive speaker market. Europe has presence of major OEMs and tier-1 suppliers who have advanced facilities that carry out research and development on speakers, which is anticipated to boost the automotive speaker market across Europe.
Automotive Speaker Market: Competition Landscape
- Key players operating in the global automotive speaker market include –
- Alpine Electronics Inc.
- Bose Corporation
- Harman International
- Pioneer Corporation
- Altec Lansing
- SK Telecom
- Lear Corporation
- Metra Electronics
- Boston Audio
- Key players are expanding their footprint by engaging in mergers and acquisitions with several players in the industry. On January 2020, Harman International introduced its EV Plus+ Solutions, a new audio and communications solutions bundle designed specifically for the rapidly expanding electric vehicle (EV) segment and their eco-conscious owners. The solutions overcome challenges unique to EVs and offer consumers a no-compromise level of entertainment, communication, and comfort that is flexibly and sustainably.
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