automotive system simulation software Market

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.

The Asia Pacific (APAC) region is leading the way in the manufacture and sale of automobiles, thanks to the presence of major players in the automotive industry, including Geely Auto Group, Honda, Tata, and Toyota. The region is experiencing high demand for new vehicles from fast-growing economies such as China and India, as well as developed countries such as Australia, Japan, and Singapore. The focus of Asian countries on building a strong manufacturing sector has also contributed to the growth of the automotive manufacturing industry in the region. For instance, the Indian government launched The Automotive Mission Plan in August 2021, with the aim of increasing the automotive sector's contribution to the national GDP to 12% and creating around 50 million new jobs. In addition, strict regulations on ICE vehicles have been introduced due to the urgent need to limit air pollution caused by emissions, particularly from passenger vehicles. The adoption of electric vehicles is also being encouraged in the region, particularly in China and Japan. According to ZoZo Go, electric vehicle sales in China reached 3.3 million units in 2021, up from 1.3 million in 2020 and 1.2 million in 2019. These factors are expected to drive the demand for automotive system simulation software in the region, as these solutions can speed up the production of vehicles and their components while maintaining reliability.

Automotive system simulation software market is characterized by key players, including Ansys, Inc., Hexagon AB, Siemens AG, and dSPACE GmbH, who maintain their dominance through various strategies such as launching new products, expanding their businesses, and acquiring other companies. For instance, in December 2021, dSPACE GmbH collaborated with KPIT Technologies and Microsoft Corporation to provide a distinct solution for original equipment manufacturers and Tier-1 companies to obtain homologation for advanced driver assistance systems.

IMPACT OF COVID-19 PANDEMIC ON AUTOMOTIVE SYSTEM SIMULATION SOFTWARE MARKET

The global automotive industry suffered a significant blow due to the COVID-19 pandemic, which originated in China, leading to a 71% decline in sales in February 2020. By April of the same year, sales in the US and Europe also plummeted by 47% and 80%. As a result, major automotive manufacturers experienced a decline in automotive system simulation software market demand. However, from the third quarter of 2020 through the second quarter of 2021, the supply chain began to recover, resulting in a gradual increase in production levels for automakers. The crisis has also accelerated the digitization process in the mobility value chain and brought about rapid transformation. Although pandemic-related restrictions led to temporary shutdowns of production lines, non-manufacturing processes were still able to be attended to by employees working from home or remotely. The use of automotive system simulation software has been critical in aiding automakers during the crisis since product development processes could be continued even with limited or no access to laboratories.