Pune, June 28, 2025 (GLOBE NEWSWIRE) -- Autonomous Driving Software Market Size Analysis:

“The SNS Insider report indicates Autonomous Driving Software Market size was valued at USD 1.8 billion in 2023 and is estimated to reach USD 5.58 billion by 2032, growing at a compound annual growth rate (CAGR) of 13.58% during the forecast period 2024–2032.”

In 2023, the U.S. market was valued at approximately USD 0.5 billion and is projected to reach USD 1.55 billion by 2032, growing at a CAGR of around 13.47% from 2024 to 2032. Growth is driven by strong R&D investments, regulatory support for AV testing, and rapid advancements in AI and sensor technologies.

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Major Players Analysis Listed in this Report are:

Autonomous Driving Software Market Report Scope:

Report Attributes	Details
Market Size in 2023	US$ 1.78 Billion
Market Size by 2032	US$ 5.58 Billion
CAGR	CAGR of 13.58% From 2024 to 2032
Base Year	2023
Forecast Period	2024-2032
Historical Data	2020-2022
Key Segments	• By Level of Autonomy (L1, L2, L3, L4 & L5) • By Propulsion (ICE, Electric Vehicles) • By Vehicle Type (Passenger Vehicles, Commercial Vehicles) • By Software Type (Perception & Planning Software, Chauffeur Software, Interior Sensing Software, Supervision/Monitoring Software)
Key Growth Drivers	Rising Consumer Demand for Safer and More Efficient Transportation Drives Autonomous Vehicle Software Growth

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By Level of Autonomy: L2 Leads, L4 & L5 to Surge with Advanced AI Integration

The L2 segment dominated the market in 2023 and accounted for 42% of revenue share, owing to the maturity of L2 automation and its widespread adoption in modern vehicles. L2 is the semi-autonomous driving class and the de facto mainstream spec provided across the OEM landscape, with functionalities like adaptive cruise control and lane-keeping assistance.

The L4 & L5 segment is anticipated to grow at the fastest pace, with companies such as Waymo, Cruise, and Baidu already testing fully autonomous prototypes within just a few years of rapid AI development. These levels allow for complete vehicle autonomy, with L5 having no human intervention at all. When regulations are adapted to changing landscapes and infrastructure is upgraded to meet the needs of full autonomy, L4 and L5 will experience exponential growth.

By Propulsion: ICE Vehicles Dominate While EV Segment Accelerates Fastest Growth

Internal combustion engine (ICE) vehicles dominated the market in 2023 and accounted for 64% of revenue share, due in part to its high US installed base and ongoing improvements in semi-autonomous functionality. As OEMs take their first steps toward electrification, they need to maintain a fingerhold in the old ICE world relative to the competition and must therefore integrate the autonomous functionality into these legacy platforms. Moreover, the ICE vehicle infrastructure is still strong all over the world, but especially in developing economies where people are expected to resist the switch to EVs, which means there's still demand.

Electric vehicles (EVs) are expected to witness the fastest CAGR  during the forecast period, attributed to their compatibility with autonomous driving systems. EV architectures provide for easier integration of SD features and driving algorithms with the help of greater efficiency and energy consumption. EV platforms have also been turned into testbeds for autonomous automakers. With new breakthroughs in battery range technology and a growing smart charging infrastructure, the convergence of EV and Autonomous technology will usher in the next frontier of mobility.

By Vehicle Type: Passenger Vehicles Lead While Commercial Vehicles Set to Grow Rapidly

Passenger vehicles dominated the market in 2023 and accounted for 72% of revenue share due to increasing consumer adoption of driver-assistance systems and safety. With the market for new buyer-acquisition sources getting tighter, automakers are pouring serious dollars into dozens of advanced autonomous software making it into sedans and SUVs with the goal of keeping the customer happy while not splitting their head open on the dashboard, and to differentiate in a split automotive market. The trend regarding software-defined vehicles is primarily driven by consumers

Commercial vehicles, however, are projected to grow at the fastest rate due to increasing demand for automated logistics, last-mile delivery, and long-haul freight efficiency. Commercial vehicles will witness the fastest growth. The advantages of autonomous driving trucks, vans, and delivery robots will be the reduction of labor costs, the optimized fleet utilization, and the benefit of speed throughput. Driven by the need for operational scalability, the commercial vehicle segment will witness strong software consolidation.

By Software Type: Perception & Planning Leads, Interior Sensing Grows Fastest with Cabin Intelligence

Perception & planning software dominated the market in 2023 and accounted for 43% of revenue share, as it serves as the bedrock of autonomous driving systems by providing real-time environmental awareness and trajectory planning capabilities. Such modules fuse input from LiDAR, radar, and cameras they enabling real-time decisions and are therefore critical to anything above the lowest levels of vehicle autonomy.

Interior sensing software is expected to grow at the fastest CAGR because of increasing regulatory requirements for driver monitoring, drowsiness detection, and in-cabin safety features. With the transformation of the vehicle cabin into an intelligent, responsive environment, vehicle personalisation and passenger privacy will drive software add-on demand, claimed the report.

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By Region: North America Leads, Asia-Pacific Emerges as Fastest Growing Market

North America dominated the autonomous driving software market in 2023 and accounted for 39% of revenue share, due to increased output on the part of automotive OEMs, R&D investments, and regulatory frameworks. With many pilot programs, AV tests infrastructure, and of course, AI innovation centers going on, the U.S., in particular, takes the lead.

Asia-Pacific is projected to grow at the highest CAGR during 2024–2032, driven primarily by China, Japan and South Korea. Rising Urbanization, Investments in Smart Mobility, and Government-backed Autonomous Initiatives are Accelerating Regional Adoption.

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