Omdia expects connected vehicles to become a billion-unit market by 2035. Its latest research forecasts 1.05 billion connected vehicles worldwide. That is more than double the 473.7 million units expected in 2025.
The forecast points to an 8.3% compound annual growth rate. For telecom operators, this marks a major IoT expansion path. Cars are becoming rolling digital platforms, not just transport products.
This growth brings clear commercial appeal. Automakers can sell connected services after the vehicle leaves the showroom. These may include navigation, safety alerts, software upgrades, and entertainment features.
At the same time, customers will expect stable and reliable service. That raises the importance of service level agreements, or SLAs. These agreements define service quality, uptime, and response targets.
A major part of this shift involves OTA updates. These are software updates delivered wirelessly to vehicles. They help automakers fix issues, improve features, and add new functions remotely.
However, the industry faces a serious network timing issue. LTE networks will not remain in place forever. Omdia warns that planned LTE shutdowns could disrupt this growth.
The impact may exceed earlier 2G and 3G sunsets. Connected vehicles depend on LTE for many critical functions. These include electric vehicle routing and emergency services.
They also include driver assistance tools and real-time safety features. If connectivity fails, the problem becomes operational, not just commercial. Automakers must protect both user experience and safety.
This creates pressure across the automotive and telecom sectors. Vehicle lifecycles usually last longer than mobile network cycles. A car may stay on roads for 15 years or more.
Mobile operators, meanwhile, upgrade networks much faster. They need spectrum for newer services, including 5G. That tension makes long-term planning essential.
Omdia says automakers must align product plans with operator timelines. They also need clear upgrade paths for vehicle modems. Without this planning, connected features may become unreliable.
The challenge also affects recurring revenue models. Automakers increasingly view software and services as long-term income sources. Network uncertainty could weaken those plans.
Still, the market direction remains strong. Connected vehicles will need dependable mobile links, smarter software, and flexible service platforms. For telecom providers, this opens a valuable role.
Operators can support automakers with managed connectivity and lifecycle planning. They can also help maintain service quality across regions. That will matter as vehicles cross borders and networks evolve.
The connected vehicle market is moving fast. Yet its success depends on careful network coordination. The next decade will test how well automakers and operators work together.
