AUTOMOTIVE PREMIUM AUDIO SYSTEM MARKET ANALYSIS

The Automotive Premium Audio System Market size was valued at USD 12.7 billion in 2022 and is anticipated to witness a compound annual growth rate (CAGR) of 9.7% from 2023 to 2030. The market for premium audio systems created for and installed in cars is referred to as the Automotive Premium Audio System Market. Leading producers of audio equipment typically create these audio systems, which are then incorporated into cars during the manufacturing process. Recently, a number of factors have contributed to the market for automotive premium audio systems gaining significant traction. Using multiple speakers, woofers, and other parts, automotive premium audio systems provide a high-end audio experience that goes beyond just playing music and the radio. They now include telematics, hands-free calling, e-calling, diagnostic and in-vehicle services, telecommunications, and navigation.

Automotive Premium Audio System Market: Regional Insights

On basis of region, the Automotive Premium Audio System Market is segmented into North America, Europe, Asia Pacific, Latin America, Middle East, and Africa. By 2021, the Asia Pacific region holds a commanding share of the global market for automotive premium audio systems. This can be attributed to a number of things, including the rising acceptance of semi-luxury cars in nations like China and India as well as the region's rising need for electric vehicles.

Semi-luxury vehicles have become more popular in recent years, as consumers place a higher value on comfort and convenience features in their vehicles. This pattern has been especially noticeable in developing nations like India and China, where the growing middle class is fueling demand for more expensive vehicles. Automakers have been making significant investments in premium audio systems as a key differentiator for their vehicles as a result.

Moreover, the region's dominance in the market for automotive premium audio systems has been aided by China's sizeable share of the global market for electric vehicles. The demand for cutting-edge audio systems that can grows as electric vehicles continue to become more and more popular create a compelling and immersive driving experience. The Chinese government has also been promoting the use of electric vehicles by offering incentives for their purchase and the construction of charging infrastructure. As a result, the market for high-end audio systems in the area has experienced significant growth.

Over the course of the forecast, the Asia Pacific region is anticipated to continue to dominate the market for premium automotive audio systems. The region's sizable and quickly expanding automotive market, along with rising consumer demand for high-end features in cars, are likely to propel this trend even further Expansion in this market. Additionally, as manufacturers work to meet the particular needs of owners of electric cars, the ongoing transition to electric vehicles is anticipated to open up new opportunities for them.

In the upcoming years, the demand for high-end vehicles and advanced audio features is expected to propel the growth of the North American market for automotive premium audio systems. The market's largest share is anticipated to belong to the United States, followed by Canada and Mexico.

The demand for high-end automotive audio systems in Europe is also anticipated to increase steadily, especially in nations like Germany, France, and the United Kingdom. The market is fueled by the presence of top automakers in the area and the high demand for luxury cars.

Figure 1. Automotive Premium Audio System Market Share (%), By Region, 2022

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Automotive Premium Audio System Market Drivers:

The increasing number of hours spent in cars due to traffic congestion.

The increased modernization and urbanization in the developed regions affected the traffic routines in such regions. For instance, in 2022, London drivers spend a whopping 325 hours (nearly 13.5 days) a year stuck in rush hour traffic. The city has been ranked as the most congested in the world, in the TomTom Traffic Index Ranking 2022. As a result, consumers are seeking high-quality audio systems to enhance their driving experience and make their time in the car more enjoyable.

Technological advancements in premium audio systems

Although most cars come with Bluetooth connectivity as standard equipment, consumers are now looking for more sophisticated connectivity options like Apple CarPlay and Android Auto. With the help of these features, drivers can seamlessly connect their smartphones to their automobiles, making it simpler for them to make calls, send messages, and access their preferred music and entertainment apps. Consequently, during the forecast period, it is anticipated that the sum of all these factors will create new opportunities for the growth of the global automotive premium audio system market. The market is growing as a result of increasing investments from major players and a surge in innovations for premium audio systems for automobiles.

For instance, in January 2023 HARMAN, an automotive technology company and subsidiary of Samsung Electronics Co., Ltd. focused on designing consumer experiences at automotive grade, unveiled HARMAN Ready on Demand, a software platform for delivering branded audio value, feature enhancement, upgrades, and monetization opportunities in an easy to-use app.

For instance, in September 2021, with the introduction of the JBL Club 605 CSQ car speaker system and JBL Celebrity 100 Bluetooth-enabled car multimedia player in India, Harman increased the scope of its aftermarket automotive solutions. At a special introductory price of INR 5,490, this entertainment system is offered by a number of automobile retailer locations throughout India.

Automotive Premium Audio System Market Opportunities:

Integration of Internet of Things (IoT) and advanced driver assistance systems (ADAS)

The integration of the Internet of Things (IoT) into on-board systems has resulted in smart, connected vehicles that offer a wide range of advanced functions and services to drivers and passengers. IoT-enabled audio systems in cars can offer many benefits to drivers and passengers. The most important advantage is that it can connect to various audio streaming services such as Spotify, Apple Music and Tidal. By connecting the vehicle's audio system to the Internet, users can access an unlimited library of music, podcasts and audiobooks.

Advanced Driver Assistance Systems (ADAS) are also a set of technologies designed to improve driving safety and comfort. ADAS systems use sensors and cameras to monitor the vehicle's surroundings and provide real-time feedback to the driver to perform tasks such as parking, changing lanes and avoiding collisions. One of the main drivers of IoT car audio is the growing demand for connected cars. Combined with IoT, connected cars can communicate with other vehicles, infrastructure and devices. These vehicles also offer a wide range of features such as real-time traffic updates, remote control and automatic emergency assistance. As demand for these features increases, automakers are focusing on integrating IoT technology into vehicles, driving the adoption of intelligent voice assistants, IoT, and ADAS in car audio systems.

Automotive Premium Audio System Market Trends:

Increasing demand for premium audio systems

As music streaming services become more popular and people spend more time in their cars, the demand for high-quality audio systems is increasing. Consumers are willing to pay more for a premium audio experience, leading to increased sales of premium audio systems. Premium audio systems are becoming increasingly sophisticated in terms of sound quality, and manufacturers are using advanced technologies such as digital signal processing, noise reduction and active sound management to deliver a superior listening experience.

Emergence of Electric Vehicles

The rise of electric vehicles presents both challenges and opportunities for high-performance audio systems. Electric vehicles are generally quieter than vehicles with an internal combustion engine. This means less outside noise to mask the sound system's flaws. This further emphasizes sound quality and increases the demand for premium audio systems capable of providing a high-quality listening experience even in low-noise environments.

Automotive Premium Audio System Market Restraints:

Absence of adequate Software Developments

The lack of advanced technology for next-generation cars is a major factor restraining growth of car audio market. The lack of suitable software advancements to support new technologies in automotive audio hardware is impeding dash stereo acceptance in a number of industrial verticals. For example, the introduction of voice recognition technology, a hardware based innovation, is partially appropriate for current software solutions in use. But as consumer lifestyles change, it's expected that the use of in-car infotainment systems in ride-sharing facilities will advance quickly.

High cost of ownership and maintenance:

Major factors including high cost of ownership and maintenance associated with premium car speakers and increasing availability of alternative products will restrain the market growth to some extent during the forecast period. Additionally, these vehicle systems are believed to have the potential to distract drivers, which could lead to road accidents. This is expected to further limit revenue growth.     

Figure 2. Automotive Premium Audio System Market, By Application

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Automotive Premium Audio System Market Segmentation:

Automotive Premium Audio System Market, by Product Type (6 Disc, 8 Disc, 10 Disc, and 12 Disc), by Application (Passenger Cars and Commercial Vehicles), by Sales Channel Type (Original Equipment Manufacturer and After Market).

Automotive Premium Audio System Market: Key Developments

For instance, in January 2023 HARMAN, an automotive technology company and subsidiary of Samsung Electronics Co., Ltd. focused on designing consumer experiences at automotive grade, unveiled HARMAN Ready on Demand, a software platform for delivering branded audio value, feature enhancement, upgrades, and monetization opportunities in an easy to-use app.

For instance, in February 2022, Harman International Inc., an audio electronic firm, launched its range of acoustic innovations, Ready Together and Software-enabled Branded Audio, featuring a software platform that upgrades sound quality. The company aims to provide connected technologies & solutions for consumer, automotive and enterprise markets.

For instance, in September 2021, with the introduction of the JBL Club 605 CSQ car speaker system and JBL Celebrity 100 Bluetooth-enabled car multimedia player in India, Harman increased the scope of its aftermarket automotive solutions. At a special introductory price of INR 5,490, this entertainment system is offered by a number of automobile retailer locations throughout India.

Automotive Premium Audio System Market: Key Companies Insights

Some of the key players in the Automotive Premium Audio System Market are Bose Corporation, Bowers & Wilkins, Harman International Industries, Inc., Klipsch Audio Technologies, Bang & Olufsen, Alpine Electronics, Inc., Sonos, Onkyo Corporation, Panasonic Automotive System, Blaupunkt GmbH, and QSC, LLC.

*Definition: The automotive premium audio system market refers to the segment of the automotive industry that produces high-quality audio systems for vehicles. This market is driven by increasing consumer demand for a superior audio experience while driving and is characterized by advanced sound processing technologies, customization options, and integration with infotainment systems.