The global automotive diagnostics market is gearing up for a major leap, projected to grow from $40.77 billion in 2020 to a staggering $109.84 billion by 2030, registering a robust CAGR of 10.5% over the forecast period, according to a new report by Allied Market Research.
North America remains the dominant region in terms of revenue, with the U.S. leading the global share in 2020. Europe, Asia-Pacific, and LAMEA follow closely, with Mexico emerging as a high-growth market, driven by increasing demand for technologically advanced vehicles.
The surge is attributed to rising demand for IoT-enabled systems, rapid development of the global automotive industry, and the increasing preference for vehicle safety and real-time diagnostic tools. On-board diagnostics (OBD) are particularly gaining traction as vehicles become more software-driven and connected.
“Technological advancements in both semi-autonomous and electric vehicles have opened new doors for diagnostic solutions, especially mobile-based tools that integrate seamlessly with consumer smartphones,” the report notes.
Key Growth Drivers:
- Growing need for on-board diagnostic systems due to increased electrification and automation
- Rising vehicle complexity requiring real-time data and predictive maintenance
- Strong OEM investment in in-house and aftermarket diagnostic systems
Among types, the on-board diagnostic segment is expected to see the most significant growth. From a device standpoint, mobile-based tools are forecasted to be the fastest-growing segment due to their accessibility and ease of integration. In terms of application, electric vehicles (EVs) are poised to register the highest growth rate during the forecast period.
Asia-Pacific is predicted to register the highest CAGR, driven by expanding automotive production hubs in China, India, Japan, and South Korea.
Industry Leaders:
Key players shaping the global landscape include:
- BMW AG
- Continental AG
- Delphi Automotive PLC
- Denso Corporation
- Harman International
- Robert Bosch GmbH
- Magna International
- Snap-On Inc.
- Vector Informatik
- Pioneer Corporation
One notable development was Denso Corporation’s launch of the Connected Services Pennsylvania Technical Center in 2019, which boosted the company’s capabilities in advanced diagnostics and aftermarket solutions across North America.
Despite the promising outlook, the report warns of challenges such as high implementation costs, complex configurations, and frequent software maintenance requirements, which could hamper adoption, especially among small- and mid-tier manufacturers.
However, as automakers worldwide accelerate toward fully connected and autonomous fleets, the demand for cutting-edge diagnostic systems is expected to skyrocket — making the sector a key battleground in the next phase of automotive evolution.
