According to analysts at Fortune Business Insights, the digital logistics market will reach $19.9 billion by 2032. This statistic primarily indicates the demand for automotive IoT technologies, cloud-based centralized fleet management systems, and similar solutions.
And this is not just about chasing trends, but rather a logical step towards comprehensive automation and the autonomy of transportation processes, although not limited to that alone.
Technological progress is becoming increasingly integrated into personal solutions, such as passenger cars, SUVs, EVs, not to mention light commercial vehicles like pickups and vans, or heavy trucks.
Therefore, if you want to keep up with the times and trends, you need to be at the forefront of innovation. And for this, you need not only IoT application development services but also an understanding of why this is important.
What Is Automotive IoT and Why It Matters
IoT in the automotive industry is a vast and still not fully explored market. New solutions appear almost daily; startups are emerging, attracting millions in investments thanks to their innovations. However, money is not the only driving force behind this niche.
IoT (Internet of Things) is a concept aimed at connecting diverse devices and equipment into a single system. Moreover, it simplifies the management of various tools that seemingly were not intended for such use cases.
For the automotive industry, IoT can even be called a critical tool for solving completely different tasks:
Monitoring the operation of units, components, and even individual elements of the chassis (and not only) of the vehicle.
Monitoring and analyzing vehicle behavior, fuel consumption, the efficiency of lubricants, and more.
Planning and forecasting maintenance intervals, predicting and calculating the wear of individual parts or entire assemblies.
Real-time route tracking, calculation of road expenses, and so on.
Creating digital twins for data collection, testing different models, and more.
The safety aspect, which is revealed through IoT and focuses not only on technical matters but also on monitoring driver behavior that could potentially lead to accidents or other incidents.
And this is not even an approximate list of reasons why the Internet of Things in the context of automotive deserves attention. Large car manufacturers have already been equipping their products with such systems for over a decade, but full IoT integration is still far from being achieved.
Key Applications of IoT in the Automotive Industry
IoT for automotive has a significant number of applications. The practical advantages of this type of technology outweigh its nuances and challenges, and the potential for development and improvement is currently considered limitless.
Among the advantages of IoT are the following points:
Connected vehicles and telematics enable data exchange between cars and infrastructure to improve traffic safety and efficiency.
Autonomous driving systems allow vehicles to operate without driver involvement thanks to artificial intelligence and sensor technologies.
Predictive maintenance and diagnostics help detect and eliminate potential malfunctions before they occur.
In-vehicle infotainment systems and personalization features enhance the user experience during trips.
Fleet management and logistics optimization help effectively control transportation resources and routes.
Usage-based insurance (UBI) considers driving style and frequency to determine individual rates.
Over-the-air (OTA) software updates allow enhancing vehicle functionality without visiting a service center.
Smart infrastructure and V2X communication provide information exchange between vehicles and the environment to increase road safety.
And these are just the general concepts that roughly describe the use cases of these technologies to improve the experience of drivers, dispatchers, managers, and even logistics business owners. And ordinary car owners too, as non-commercial serial vehicles are also equipped with smart devices. However, the devil is in the details, which will be discussed further.
Connected Vehicles and Telematics
Connectivity with mobile networks or even satellites is what provides drivers and transport business owners with the widespread adoption of IoT. These solutions are integrated into the automotive ecosystem and perform a whole range of functions.
From simple navigation to synchronization with applications in automotive systems, convenient monitoring of regional news related to routes and safety situations.
This is not exactly what automotive IoT refers to, but it is still part of the larger digital ecosystem that is being deployed in most cities and countries.
Autonomous Driving Systems
Relaxing in the back seat while the car moves along the route? Something similar was shown in Star Wars, but gradually it is appearing in reality. The same advanced driver assistance systems and Tesla autopilots, which not only take you from point A to point B but also park themselves and perform quite complex maneuvers.
As for trucks, due to higher risks, automotive IoT technology and autonomous pilots are being integrated much more cautiously. But while you are reading this material, a number of manufacturers are conducting tests on highways in the USA, Canada, and other countries.
Why is an autopilot needed? It is free from the human factor, especially the tendency to take risks, it reacts faster and generally strictly follows traffic rules, keeps a safe distance, etc. How is this possible? A system of 360 cameras, AI with millions of man-hours of training, other sensors and systems through which the control of a truck, passenger car, or drones is carried out.
Predictive Maintenance and Diagnostics
Imagine that you (or your staff) know in advance that at a certain time the car will require repairs, as well as the details of what exactly will fail. Yes, experienced drivers can predict potential breakdowns even based on vehicle behavior, but the accuracy of such forecasts leaves much to be desired.
With IoT sensors, historical and statistical data, manufacturer information, technical specifications, etc., the system can automatically calculate and schedule vehicle maintenance periods. And this is even without the help of digital twins.
Why is this important? You will repair the vehicle in time, avoiding unplanned downtime and safety risks.
In-Vehicle Infotainment and Personalization
Truck driver or passenger car driver – it does not matter. The comfort of the trip affects the physical and emotional state of everyone in the cabin. Therefore, configuring its parameters is essential for long or difficult journeys.
IoT systems can serve for manual and even automated adjustment of various characteristics. From seat height and backrest angle to radio volume or music that adapts to specific road conditions.
Route hints on the dashboard, display of important information, audio-visual notifications about malfunctions, deviations, and so on.
Fleet Management and Logistics Optimization
For logistics business owners, IoT devices and sensors significantly improve operational capabilities. Thus, the controllability of each element of the supply chain, data collection, and analytics increases.
Accordingly, analyzing the data collected from sensors and vehicle systems allows better route planning, saving fuel, timely vehicle maintenance, reducing transportation risks, and increasing profitability.
Moreover, with advanced technologies, companies’ dependence on physical resources decreases, or rather, the potential for their optimization and logical distribution appears.
Usage-Based Insurance (UBI)
For logistics companies, for ordinary drivers, for insurers, IoT in vehicles can become a lifeline. Data analytics from devices helps calculate individual driving characteristics. And it is precisely these that can be used for personalizing insurance packages.
Conditionally, instead of purchasing full CASCO insurance, alternative options appear that cover those scenarios and cases typical for a specific region, vehicle, and driver. Why pay more for something that will not be needed?
Savings, practicality, personalization – and these are only superficial advantages of implementing the IoT ecosystem through IoT devices in vehicles.
Over-the-Air (OTA) Software Updates
The times when each individual device was flashed only through physical contact are in the past. The new standard of updates is wireless centralized solutions. The less noticeable for the end beneficiary, the better.
Imagine, during the time while the truck is being unloaded/loaded, the software on IoT sensors, IoT systems, and onboard computers is being updated and undergoes self-testing. The driver receives improvements that can be felt from the first minutes of the next trip.
Convenient? Yes, and it also saves time and nerves, reduces the risks of manual device flashing.
Smart Infrastructure and V2X Communication
Imagine a situation where the environment itself tells you how and where it’s better to move, where to stop for lunch or simply for a break, how to avoid traffic jams, and so on. Sounds futuristic? But this is reality!
Well, not yet 100% reality, but the first steps in this direction have already been taken. For example, Dubai, where almost the entire infrastructure is digitalized. Yes, even road signs, traffic lights, and even some parts of the road surface.
Through IoT, an exchange takes place between vehicle systems and external devices, so the computer analyzes the current state of affairs and provides the driver with valuable recommendations regarding routing, etc.
Real-World Examples of Automotive IoT
While you are reading this article, some car manufacturers are not just ahead in this competitive industry but also continue to conquer the market. How is this possible? They are looking into the future of the automotive industry, investing in technology in the automotive industry, testing, drawing conclusions, and improving.
The result – higher sales, safety certifications, entering new markets. Who are we talking about? Tesla, BMW, Ford, and Toyota: pioneers of technology in the world of cars. Mostly passenger ones, but they do not forget about commercial solutions either.
Therefore, examples of various automotive IoT industry, self-driving cars, cloud-connected IoT, etc., are definitely worth focusing on.
Tesla: A Data-Driven Leader in Automotive IoT
You will not find a more connected car among automotive industry players than Tesla models. Implementing IoT technologies allowed this automotive manufacturing enterprise to become an icon of the niche. Literally. Autonomous electric cars are popular far beyond the USA, and even quite high prices do not scare away customers.
Not only passenger models but also conceptual trucks, cars rely heavily on IoT, are gradually being launched into mass production. The brand is unlikely to oust such players as Volvo or MAN, but it will still occupy its niche, in particular, filling the fleets of progressive logistics providers.
BMW: Enhancing Driver Experience Through Connected Services
Driver comfort is the main focus of BMW. And development with the deployment of IoT only creates new opportunities for the brand. Despite all the current challenges of IoT, the company uses advanced equipment and software to study driving patterns, and the impact of various factors on them.
Like other industry stakeholders, the brand analyzes data and uses it to improve various aspects of all model ranges. As a result, the company increases sales year after year, both in the luxury and affordable car segments.
Ford: Practical Connectivity for Everyday Drivers
A somewhat more conservative approach to IoT in the automotive sector, but with the belief that IoT is reshaping the automotive segment, Ford cautiously works with innovations. Perhaps the brand cannot impress with the technological advancement of cars and autopilots, but it still surpasses competitors in terms of practicality.
All car models, and some even in basic configurations, are equipped with navigation systems and special devices that leverage IoT. Thus, the company receives valuable data about the behavior of drivers and cars in different situations. Car owners, in return, receive advanced safety solutions, digital assistants, and an infotainment system.
Toyota: Leading the Way in Smart Mobility Services
A universal approach to the benefits of automotive IoT, which combines innovation with practicality. Autopilots, driver assistance systems, built-in diagnostics, navigation. Nothing too expensive (premium models are an exception), but everything useful for the driver, their safety, and comfort.
The company understands the potential of the automotive IoT platform, so it often invests in technological startups and R&D centers, being among the first to gain access to more modern and advanced solutions.
Key Benefits of IoT in the Automotive Industry
In addition to all of the above, Internet of Things automotive has additional advantages. Mostly, they overlap with each other, but they demonstrate a whole range of reasons to order automotive software development services and not delay the integration of innovations.
These include:
Safer roads. Cars themselves warn about danger, brake, and see what you don’t see.
Fewer breakdowns – more peace of mind. Sensors in the car “listen” to the equipment and notify when something is wrong.
Fleet under control. For business: every car, its route, expenses, and driver behavior are clear as day.
Stress-free routes. The car suggests the best road considering traffic jams, weather conditions, and time.
Fuel and money savings. You drive more efficiently, repair less often, and spend less.
A car that knows you. Favorite playlist, comfortable seat, optimal temperature – everything automatically.
Updates like on a smartphone. Software is updated remotely, without service centers, without queues.
Fair insurance. Insurance is based on how you drive, not on general statistics.
A car that “communicates.” Cars exchange data with each other and with infrastructure – this reduces risks.
Smart data – smart decisions. Manufacturers analyze millions of data points to create even better and safer cars.
Thus, IoT refers to the integration of sensors, but it also has a purely conceptual meaning, influencing the automotive market, shaping audience standards, and more.
Automotive IoT Architecture: Technologies Behind It
Before IoT technology enables us to use modern solutions, the automobile industry has undergone a comprehensive transformation together with the IT market. Therefore, today IoT includes:
Sensors and actuators. The “eyes” and “hands” of the vehicle. Sensors read data (temperature, speed, tire pressure), while actuators respond, for example, by activating the brakes or turning on the lights.
Connectivity and networks. The car connects via Wi-Fi, 5G, LTE, Bluetooth, DSRC, or NB-IoT – everything necessary for real-time data transmission.
On-board computer / ECU. A vehicle has several control units (ECUs) that process data locally, without sending it to the cloud. This is faster and more reliable.
Cloud and servers. The cloud stores and processes large volumes of data: telematics, analytics, updates, interactions with mobile apps, machine learning, etc.
Security and encryption. All data between the car, infrastructure, and cloud must be protected from malicious actors, and this is ensured by certificates, VPNs, and multi-layer encryption.
Analytics and artificial intelligence. AI analyzes driving styles, warns about risks, predicts maintenance – and even teaches autonomous systems to move independently.
OTA – over-the-air updates. The car receives new features or bug fixes, just like a smartphone, without the need to visit a service center.
All these elements together form a unified automotive IoT ecosystem.
Challenges and How to Overcome Them
Modern solutions are not only advantages but also challenges that have to be dealt with at various levels. For example:
Challenge | Solution |
Compatibility of devices from different manufacturers | Using logistics software development services, it is possible to integrate all types of automotive and infrastructure IoT equipment into a single cloud-based system |
Complexity of integrating IoT with purely mechanical units and assemblies | Special devices are gradually emerging that run on utilitarian operating systems and convert purely physical indicators into digital signals, which are then transformed into information via specialized software. These devices also have additional mechanisms for controlling equipment through a command system integrated into the platform |
Cost of developing and integrating IoT in automotive industry | With the advancement of technology and the emergence of new equipment, its cost will gradually decrease. However, you can already start saving if you invest in creating at least a foundation for integrating IoT platform solutions in a timely manner. |
All risks and challenges can be avoided with a well-considered approach to the development and integration of these types of solutions.
How to Adopt Automotive IoT Solutions Effectively
To effectively implement IoT solutions in the automotive sector, companies should start with a clear understanding of their business goals. This could involve improving safety, reducing costs, optimizing logistics, or enhancing the user experience. It is important to select reliable technologies for connectivity, data collection, and processing, integrate them with existing systems, and ensure cybersecurity.
Success also depends on gradual implementation: starting with a pilot project and then scaling up. It is equally important to train the team to use the new tools and to build partnerships with technology providers.
How Lampa.dev Can Help with Automotive IoT Solutions
Lampa.dev can become a reliable technology partner in the implementation of automotive IoT, offering a full development cycle: from architecture design to integration with cloud services and mobile applications.
The team has experience in creating solutions for telematics, fleet management, and OTA updates, enabling the fast launch of scalable and secure products.
For example, in one of our previous projects, we developed a platform that combines AI, machine learning, and IoT. The solution enabled the client to analyze local traffic by collecting data from various devices and sensors, including modern vehicles.
Based on this information, a number of decisions were made that optimized road congestion automatically.
The Future Of IoT in the Automotive Industry: What to Expect
The truly significant discoveries and innovations are still far ahead. However, it can already be predicted that the IoT industry will develop quite rapidly.
Even now, there are interesting developments, such as the Goodyear SightLine technology. It is a specialized platform with sensors integrated into the rubber. It collects and analyzes information about driving style, road surface, and more. It can also automatically change driving modes, for example, switching between the standard “Drive” mode and, for instance, “Snow”.
Therefore, it is now worth focusing on improving existing solutions and creating large-scale management systems for them. This will save your time and costs in the future because you will already have a foundation for modernization rather than starting from scratch.
Conclusion
IoT for automotive is not magic or futurism. It is a reality that will only penetrate the industry more deeply, gradually transforming it. Competition in the markets will also shift the focus, so even those who do not believe in the bright future of IoT may reconsider and bet on progress.
However, for this, you need an experienced IT partner, like Lampa.dev. Ready to make a quick start and capture your share of the niche? Don’t postpone – contact our manager to discuss and launch your project!