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Evolution of Extended Reality in Automotive, Global, 2025–2031

Publisher Frost & Sullivan
Published Jan 20, 2026
Length 43 Pages
SKU # MC20790091

Description

This study focuses on the transformative impact of extended reality (XR) and its evolution in the global automotive industry from 2025 to 2031. XR encompasses virtual reality), augmented reality, and mixed reality. It has been driving a paradigm shift across the value chain, enabling immersive design, accelerated prototyping, and enhanced customer experiences. This market is evolving from isolated experiments to enterprise-scale adoption, with manufacturers leveraging XR to optimize workflows and streamline operations. XR connects global teams and integrates into IT-governed ecosystems, bridging the gap between physical engineering and digital innovation to reduce costs and time to market.

The market is growing because of advancements in enabling hardware, software connectivity, and AI-driven integration, supported by a strategic shift among leading manufacturers toward scalable, data-driven ecosystems. Use cases include virtual prototyping for faster development cycles, immersive technical training for improved safety, global collaboration for distributed teams, and new revenue streams through digital customization and virtualization. As XR becomes part of core operations, technology leaders and manufacturers must deepen their collaboration to secure a competitive edge.

Table of Contents

43 Pages
Strategic Imperatives
Scope of Analysis
Segmentation
Why is it Increasingly Difficult to Grow?
The Strategic Imperative 8™
The Impact of the Top 3 Strategic Imperatives on XR in the Automotive Industry
Growth Opportunity Analysis
Growth Drivers
Growth Restraints
Market Fact Sheet
XR Market in Automotive: Overview
Evolution of XR in Automotive
XR Across the Automotive Value Chain
Value Chain Definitions
Value Chain Competitive Landscape
Technology Landscape: Enabling Technologies
Technology Landscape: Hardware Ecosystem
Technology Landscape: Software Ecosystem
Technology Landscape: Connectivity Backbone
Future of XR Technology Enablers in Automotive
Future of XR Applications in Automotive
Growth Opportunity Universe
Growth Opportunity 1: Technical Training and Immersive Workforce Development
Growth Opportunity 2: Virtual Prototyping and Design Review
Growth Opportunity 3: Customization-Driven Upselling
Next Steps
Benefits and Impacts of Growth Opportunities
Next Steps
List of Exhibits
Legal Disclaimer

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