Traditional automakers balance the need to maintain sales and profits while transitioning their product lineups to electric vehicles (EVs) while affording the leeway to switch away from selling internal combustion engine (ICE)-powered vehicles. We are facing a major challenge.New report from a global technology intelligence company ABI Research predicts that automakers will spend USD 83.3 billion on digital technology in 2023, growing at a CAGR of 8.5% to over USD 188 billion in 2033.
“The transition to EVs is driving demand for software, as manufacturers need to design new vehicles and simulate vehicle performance. New production lines also need to be simulated before they are launched. , teams are beginning to realize the potential of digital twins to collaborate and enable new work,” said Michael Larner, director of industrial and manufacturing market research at ABI Research. Before creating a digital twin, automakers must break down data silos and create digital threads with suppliers such as Amazon Web Services (AWS), Google, NVIDIA, and Siemens.
In terms of regions, “Latin America is projected to be the fastest growing region (9% CAGR) as OEMs expand digital investments across their facilities and invest in locations such as Mexico and Brazil. Meanwhile, investment in North America, Europe, the Middle East, and Africa (EMEA) will be driven by the transition to EVs and competition between OEMs’ various factories to produce new vehicle lineups.” concluded.
These findings come from ABI Research’s Digital Transformation Analysis Report for Automotive Manufacturing Applications. This report is part of the company’s industrial and manufacturing market research offering, which includes research, data, and ABI Insights. Based on extensive primary interviews, the application analysis report presents an in-depth analysis of key market trends and drivers for a given technology.