The US Connected Car Market by Hardware was valued at USD 8,220 Million in 2025, and is projected to reach USD 22,870 Million by 2035, growing at a CAGR of 9.6% from 2024 to 2035. This market covers physical components enabling connectivity in vehicles, such as telematics control units, embedded modems, sensors, and in-vehicle networking systems. Increasing demand for vehicle safety, regulatory initiatives, and advanced in-car entertainment systems are key drivers shaping the growth of hardware segment in the US connected car ecosystem.
The economic impact of tariffs on "US Connected Car Market by Hardware".
Key Growth Drivers of the US Connected Car Hardware Market
Rising Demand for Advanced Safety Features: The implementation of advanced safety features such as lane departure warning, adaptive cruise control, and automatic emergency braking is driving hardware demand. For instance, Ford Motor Company has heavily invested in integrating sensors, LIDAR, radar systems, and control units in its vehicles to comply with NHTSA’s safety regulations and meet consumer expectations for safer driving experiences.
Expanding 5G Connectivity Infrastructure: With companies like Qualcomm and AT&T accelerating the deployment of 5G networks, connected car hardware—including modems, antennas, and telematics control units—has become essential for enabling high-speed, ultra-reliable vehicle connectivity. Enhanced mobile broadband allows for real-time vehicle-to-everything (V2X) communication, advancing autonomous driving capabilities and providing a platform for innovative infotainment solutions.
Latest Trends in the US Connected Car Hardware Market
OEM Integration of Edge Computing: Automakers such as General Motors are integrating edge computing hardware directly into their vehicles, reducing latency for data-intensive applications. This enables more efficient processing of sensor data for safety and autonomous driving, and supports over-the-air updates, which optimize system performance throughout the vehicle lifecycle.
Growth of In-Vehicle Infotainment Systems: Companies like Tesla and Apple are influencing automotive original equipment manufacturers (OEMs) to expand hardware deployment for sophisticated infotainment systems. This includes high-resolution touch screens, powerful processors, and integrated voice assistants, enhancing the digital driving experience and creating new monetization opportunities through digital services and in-car commerce.
Emerging Opportunities in the US Connected Car Hardware Market
Expansion in Smart City Integration: As cities adopt smart infrastructure, companies like Cisco are providing connected car hardware for seamless vehicle-to-infrastructure (V2I) communications, assisting in traffic management and reducing congestion through real-time data exchanges.
Retrofit Solutions for Aftermarket: Firms such as Verizon Connect are targeting the aftermarket segment with retrofit connected car hardware kits, enabling older vehicles to access modern connectivity features, thus expanding the addressable market.
US Connected Car Hardware Market Revenue (USD Million), 2020–2035
The chart visualizes the growth in market revenue from 2020 to 2035. Revenue climbs from USD 4,000 Million in 2020 and undergoes steady yearly gains, peaking at USD 22,870 Million by 2035. The sharpest increases occur post-2025, driven by regulatory mandates, technological adoption, and 5G rollout, reflecting the sector’s dynamic expansion. This upward trajectory highlights strong demand for connectivity hardware in vehicles as both automakers and aftermarket players prioritize digital transformation, advanced safety, and infotainment features.
US Connected Car Hardware Market Share by Region, 2025
The 2025 pie chart illustrates US regional market shares. The Midwest holds the largest share at 30%, driven by automotive manufacturing hubs in Michigan and Illinois. The West accounts for 25%, propelled by Silicon Valley’s tech ecosystem and EV adoption in California. The South represents 20%, benefitting from OEM investment in Texas and Georgia. The Northeast holds 18%, due to urban demand and smart city initiatives. The remaining 7% comprises other regions, including non-continental states. This regional distribution underscores the role of local industry clusters, tech adoption rates, and investment in shaping market potential.
Recent Developments in the US Connected Car Hardware Market (Last 6 Months)
In April 2024, General Motors announced a partnership with Qualcomm to deploy the Snapdragon Digital Chassis platform across new EV and ICE models. This integration will feature next-gen telematics control units offering advanced 5G and V2X connectivity, providing robust real-time vehicle communication and OTA capabilities for fleet operators and consumers.
In February 2024, Ford launched an updated SYNC 4A system paired with a new edge-computing-powered telematics module. The solution leverages machine learning for predictive maintenance and enables personalized infotainment experiences thanks to its upgraded onboard hardware, strengthening Ford's digital ecosystem strategy.
In March 2024, Tesla rolled out its next-generation vehicle sensor suite to all Model S and Model X vehicles, utilizing high-resolution cameras, new radar technology, and enhanced onboard processors. This hardware upgrade supports improved Autopilot performance and paves the way for future autonomous driving features, illustrating Tesla’s ongoing innovation in connected hardware.
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