Software-Defined Vehicle OTA Updates to Surpass 2 Billion Annually by 2035 as Automakers Shift to Monetizable Software Platforms
Rising SDV penetration, zonal architectures, and automotive Ethernet adoption will reshape how OEMs generate post-sale
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NEW YORK, Nov. 02, 2026 (GLOBE NEWSWIRE) — Annual Over-the-Air (OTA) update volumes for software-defined vehicles are forecast to reach 2.03 billion globally by 2035, up from 546.1 million in 2025, as automakers expand software-capable vehicle fleets and pursue recurring revenue opportunities. According to global technology intelligence firm ABI Research, true Software-Defined Vehicles (SDVs)—defined as Level 3 and above—will account for 16.7% of new vehicles sold in 2026, underscoring a major transition in how vehicle value is delivered and monetized.
“Software-defined vehicles are changing the automotive business model from one centered primarily on hardware sales to one increasingly shaped by lifecycle software monetization,” says Jennie Baker, Research Analyst at ABI Research. “The ability to deliver meaningful functional upgrades OTA gives OEMs a path to one-off feature purchases, subscriptions, and stronger long-term customer engagement, making software architecture a strategic differentiator rather than just a technical design choice.”
ABI Research’s forecasts show Level 3+ SDVs rising from roughly 16% of global vehicle shipments in 2025 to about 46% in 2035, driven largely by Level 4 growth from 5.6 million to 46.6 million shipments. At the same time, the installed base of OTA-addressable Level 3+ vehicles is expected to reach 211 million in 2031, representing more than 11% of vehicles in circulation, while all SDVs are projected to generate more than 1 billion individual OTA updates that year alone.
The market remains heavily centered in Asia-Pacific, which accounted for more than 58% of true SDV shipments in 2025 and is expected to grow to 63% by 2031. China continues to exert outsized influence, with 37% of all Level 3+ SDVs shipped in 2025 coming from BYD, Geely, SAIC, Changan, XPENG, NIO, and Xiaomi, while Tesla and BYD Group led the fragmented Level 3+ OEM market at 10.6% and 9.7%, respectively.
“As competition intensifies, OEM leadership in SDVs will depend on how effectively companies align centralized compute, OTA capabilities, and scalable E/E architectures,” Baker said. “Zonal and domain-based designs, combined with Ethernet networking, will be foundational to supporting the bandwidth, flexibility, and service agility needed for the next generation of automotive software platforms.”
These findings are from ABI Research’s Software-Defined Vehicles Market Data report, part of the company’s Automotive research service, which includes research, data, and ABI Insights.
About ABI Research
ABI Research is a global technology intelligence firm uniquely positioned at the intersection of technology solution providers and end-market companies. We serve as the bridge that seamlessly connects these two segments by providing exclusive research and expert guidance to drive successful technology implementations and deliver strategies proven to attract and retain customers.
ABI Research是一家全球性的技术情报公司，拥有得天独厚的优势，充当终端市场公司和技术解决方案提供商之间的桥梁，通过提供独家研究和专业性指导，推动成功的技术实施和提供经证明可吸引和留住客户的战略，无缝连接这两大主体。
For more information about ABI Research’s services, contact us at +1.516.624.2500 in the Americas, +44.203.326.0140 in Europe, +65.6592.0290 in Asia-Pacific, or visit www.abiresearch.com.
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