PUBLISHER: AnalystView Market Insights | PRODUCT CODE: 1901504
PUBLISHER: AnalystView Market Insights | PRODUCT CODE: 1901504
The Vehicle Services Market size was valued at US$ 978.67 Million in 2024, expanding at a CAGR of 4.2% from 2025 to 2032.
The Vehicle Services Market includes a diverse range of digital, maintenance, repair, connectivity, and value-added services that aim to improve vehicle performance, safety, convenience, and overall lifecycle management. The growing adoption of connected vehicles drives demand for telematics, remote diagnostics, and OTA (over-the-air) updates. The market is being shaped by a shift toward software-defined vehicles (SDVs), which allow for continuous feature upgrades and personalized in-car services. However, the market faces constraints such as data security and privacy concerns, as increased connectivity exposes vehicles to cyber threats. Despite this, a significant opportunity exists in the growing ecosystem of AI- and IoT-enabled predictive maintenance, subscription-based mobility services, and digital aftermarket solutions, which enable automakers and service providers to build recurring revenue models while increasing customer engagement.
Vehicle Services Market- Market Dynamics
Surge in Connected Vehicles Driving Growth in the Vehicle Services Market
The increase in connected vehicles is a significant driver of growth in the Vehicle Services Market. As consumers demand advanced safety, convenience, navigation, entertainment, and remote connectivity features, automakers are incorporating sophisticated communication technologies into their vehicles. These connected capabilities increase the demand for digital services like remote diagnostics, predictive maintenance, telematics-based assistance, over-the-air updates, and personalized in-vehicle experiences. According to the Australian Computer Society (August 2021), Australia currently has approximately one million connected cars, with a projected increase to ten million by 2030. This rapid adoption of connected vehicles is significantly increasing the demand for comprehensive vehicle services, thereby facilitating ongoing engagement between automakers and drivers.
The worldwide market is segmented on the basis of Vehicle, Service Model, Type, Service Provider, Engine, and Region.
Based on the Engine. By 2034, the EV segment is expected to grow significantly, indicating that electric mobility will expand effectively. EV-as-a-service is rapidly evolving, with over 17 million global EV sales projected for 2024 and fleet electrification growing at a 25% annual rate. VaaS providers absorb the high initial costs of EV ownership and spread them out through subscription and pay-per-drive models, making EV flexibility more accessible to consumers and lowering the financial barriers to entering the EV ecosystem.
Based on the Service Model, the subscription-based vehicle service segment controls the market due to its flexibility, bundling options, and commitment-free access to vehicles. Subscription-based Vehicle-as-a-Service (VaaS) models appeal to consumers looking for convenience, whereas pay-per-use services cater to occasional users through dynamic, demand-driven pricing. Mobility-as-a-Service (MaaS) platforms fortify this segment by combining VaaS with public transit and micromobility to enable unified payments and seamless multimodal travel. For instance, in November 2024, Zoomcar will launch long-term subscription services in major Indian cities, providing seven-day minimum access as well as insurance, maintenance, and 24/7 roadside assistance, reflecting rising consumer demand for flexible, ownership-free mobility solutions.
Vehicle Services Market- Geographical Insights
The North American Vehicle Services Market is significant, driven by a variety of factors including the region's robust aftermarket industry and technological advancements in automotive service solutions. The presence of major automotive manufacturers, service providers, and aftermarket suppliers in North America helps to maintain the region's market dominance. Furthermore, favorable economic conditions, high disposable incomes, and a strong automotive culture drive demand for automotive services in the region. North America's dominant position in automotive innovation and technology adoption makes it an important market for advanced automotive service offerings such as digitalization, connected vehicle solutions, and electric vehicle services.
United States Vehicle Services Market- Country Insights
The US Vehicle Services Market is steadily expanding, fueled by strong digital adoption, rising connected vehicle penetration, and rising consumer demand for flexible, tech-enabled mobility solutions. The country's mature automotive ecosystem, combined with rising acceptance of subscription-based mobility, online vehicle transactions, remote diagnostics, and predictive maintenance services, is driving market growth. Automakers and digital platforms are improving service delivery by utilizing advanced telematics, cloud analytics, and personalized vehicle solutions. For instance, in November 2024, Volkswagen's launch of "VW Flex" in Atlanta, which will provide month-to-month vehicle access with insurance, maintenance, and roadside assistance, positioning the United States as a test bed for Vehicle-as-a-Service. Furthermore, TrueCar's acquisition of Digital Motors in June 2022 expanded the company's digital retailing capabilities, highlighting the U.S. market's shift toward integrated, seamless vehicle service and purchasing experiences.
The global automotive services market study will provide valuable insights, focusing on the industry's fragmentation. Major players are focusing on a few strategies, such as partnerships, mergers and acquisitions, product innovations, and joint ventures, to broaden their product portfolio and increase market share in various regions. Companies in this sector have adopted major strategic initiatives such as expansion and investment. Industry players are making significant investments in research and development, new manufacturing facilities, and supply chain optimization. In January 2024, Safelite Group acquired Thompson Auto Glass to expand its geographical presence and customer base by offering customers vehicle glass repair services.
In May 2024, DigniFi announced collaborations with Encina Lender Finance (which provided a USD 150 million credit facility) and Brigade Capital Management. This combined USD 175 million investment will allow DigniFi to expand its automotive services and reach a larger customer base in the auto repair financing market.
In December 2023, MEKO implemented strategic operational enhancements in Norway to increase efficiency and improve service standards. This initiative aimed to streamline processes, increase productivity, and provide excellent customer service in all operational areas.