Summary of our market study

The global market for embedded systems is experiencing significant growth, with a valuation of $145.2 billion in 2021 and an expected CAGR of 7.2% from 2021 to 2030, according to Market Research Future. This growth is driven by advancements in technology, including the development of the Internet of Things (IoT) and increased demand for advanced driver assistance systems (ADAS) and electromobility solutions. Europe is a key player in this market, particularly France, which boasts leading companies in sectors such as automotive, aerospace, and defense.

The automotive sector is a significant consumer of embedded systems with up to 40% of a vehicle's manufacturing cost being attributed to electronics in 2020. The aerospace and defense sectors tend to internalize the production of embedded systems due to the strategic nature of their use. France, which has an electronics industry projected to reach €15.2 billion in 2020, is focusing on developing its AI capabilities in embedded systems, aspiring to capture a substantial share of the global market by 2025. Innovations are expected to continue, notably with the integration of AI in embedded systems, which could see shipments increase dramatically.

The Pulsating Demand of Embedded Systems in the Modern Market

Embedded systems have seeped into diverse sectors, driving the era of connectivity and innovation. The intertwined relationship between the development of the Internet of Things (IoT) and embedded systems has transformed everyday objects, making the potential market fascinatingly vast. An estimated annual growth rate of 7.2% between 2021 and 2030 attests to the embedded systems market's flourishing trajectory.

Automobiles, once machines solely reliant on mechanics, have evolved into sophisticated entities where electronics can account for up to 40% of manufacturing costs. The market's heartbeat accelerates in Europe where nearly one-third of vehicle embedded systems production takes place. This sector, alongside industries such as telecommunications, healthcare, aerospace, consumer electronics, and defense, feeds the growing appetite for embedded systems with automotive and industry commanding the lion's share of the market.

The French market, although its precise size remains elusive, finds itself nestled within the electronics sector projected to reach between 15 and 20 billion euros. A string of prominent French companies are pivotal in this advancement, with embedded systems market leaders like Valeo and Safran Group pushing France forward in the international market space. In aerospace and aeronautics, the embedded systems pulse is synchronized with the reliability of guidance systems in satellites and aircraft. The DEEL project, with a budget of around 15 million euros over five years, marks the commitment to embed artificial intelligence technologies in new planes and spacecraft, indicative of the sector's forward stride.

Consumer electronics, where IoT becomes palpably close to the end-user, reveal a promising horizon for embedded systems in France. For instance, connected homes, although reflecting a modest 3% of the total market in 2019, are poised for a sharp increase. The pinpoint focus on convenience and energy saving is reflected in the soaring sales of connected home appliances, which in turn, drives the embedded systems market further. It's not just homes; the medical field exhibits a surging demand for these systems, particularly with the incorporation of IoT and AI.

The quest for real-time, reliable monitoring devices like glucose meters and pacemakers is more animated than ever, tailoring patient care to adapt to the digital age. To round up the embedded systems' market enthusiasm, the presence of IoT, cybersecurity, and the palpable trend towards ecological and energy transition reveal the market's rich tapestry of opportunities.

Key Players Shaping the Embedded Systems Market Landscape

The embedded systems market is a dynamic and innovative field where numerous companies from diverse sectors contribute to pushing the boundaries of technology and improve the functionality and safety of products ranging from everyday items to highly specialized equipment. The market is replete with prominent companies that not only lead in their respective fields but also have a significant impact on the industry's trajectory by delivering cutting-edge solutions. Here's a look at some of the major players mentioned in the text that are at the forefront of the embedded systems domain:

  • Valeo: As one of the world's leading automotive equipment suppliers, Valeo is at the heart of the propulsion in automotive embedded system advancements. With their extensive R&D efforts and patent filings, they demonstrate a commitment to innovation. Valeo's product portfolio spans a wide spectrum, encompassing various embedded systems that enhance the automation and performance of vehicles. Their technological prowess is redefining the future of mobility, making driving more intuitive, safer, and more environmentally friendly.

 

  • Actia Group: Specializing in electronic equipment and systems, Actia Group's presence in the market symbolizes the interconnectivity between robust hardware and sophisticated software solutions. The company's wide-ranging expertise serves not only the automotive sector but also extends to industries like telecommunications and transportation, where the demand for reliable embedded systems continues to grow.

 

  • Latécoère: In the aeronautics sector, Latécoère is synonymous with innovation and high-quality manufacturing of structures and onboard systems. With about half of its sales coming from the embedded systems, the company is a testament to the growing significance of these technologies in aerospace—a sector where precision and reliability are paramount.

 

  • Thales: As an organization that embodies cutting-edge technology and innovation, Thales is a global technology leader for the aerospace, transportation, and defense and security markets. Their internal production of embedded systems is indicative of the strategic importance these systems hold, especially when integrating complex functionality while ensuring operational safety.

 

  • Safran Group: Safran stands as a significant player in the aerospace, defense, and security markets. Their expertise in producing embedded systems for internal use reflects the group's dedication to delivering high-technology solutions that are critical in applications ranging from engines and aircraft components to electronics and security systems.

 

  • Alstom: Globally recognized for its contributions to the transport sector, Alstom's portfolio includes high-speed trains, metros, and integrated systems. Their embedded systems play a pivotal role in ensuring efficient operation and safety of modern transportation solutions.
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  • Last update : 26/08/2022
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Summary and extracts

1 Market overview

1.1 Definition and scope of the study

The term embedded system refers to the integration of software and computer and electronic components into a product (electronic tools, vehicles, etc.) or an infrastructure in order to perform a precise and relatively simple task in order to increase its functionality, performance or automation.

The market for embedded systems therefore covers both the hardware and electronic components, the associated software and the integrators required to assemble these systems.

Among the many sectors of use of embedded systems, seven segments have been identified as major: automotive, telecommunications, healthcare, industrial, consumer electronics, aerospace and defense. The automotive sector and industry are the primary markets for embedded systems, particularly in Europe where nearly one third of the production of vehicle embedded systems is carried out.

This market is particularly promising and now affects all categories of connected objects in our daily lives. Globally, the annual growth rate is estimated at 7.2% between 2021 and 2030, thanks in particular to the development of the IoT (Internet of Things), which refers to the fact of connecting everyday physical objects to an Internet network in order to make them intelligent. [Market Research Future] Europe is particularly well positioned in this segment despite the arrival of the United States and China on the market.

France is a major player in the market for electronic components, and more particularly for embedded systems, given the presence of major French companies such as Safran, Thales and Airbus, particularly in the Toulouse region.

1.2 The growing world market

The global embedded systems market is in good shape, valued at $***.* billion in **** by Market Research Future. This market is expected to grow at a CAGR (***) of *.*% over the period ****-****. embedded Systems Market Size Evolution World, ****-***** (***) estimated at *.*% CAGR Source: Market Research Future The main factors driving the growth ...

1.3 The French market

At the time of writing, there is insufficient data to estimate the size of the French embedded systems market. Indeed, it is a cross-cutting market that can be found in several sectors, such as aeronautics and aerospace, defense, automotive, household appliances, medical, as well as in several other industries.

However, the ...

2 Analysis of the demand

2.1 Embedded systems in aeronautics and aerospace

In the aeronautics sector, the needs in embedded systems mainly concern the following products :

On-board computers Telecommunications Transmissions Servers and access points [***]

The needs of the sector are software and hardware. In aeronautics and aerospace, embedded technologies are used for the reliable guidance of satellite launchers, as well as for missiles ...

2.2 Embedded systems in the automobile

Depending on the field of application, embedded systems are subject to particular constraints and requirements. In the automobile, one of the most important constraints is real time, both for the performance of the vehicle and for the safety of the driver and passengers on board.

If a computer or an electronic ...

2.3 The use in household appliances, image of an evolving technology

In addition to being used in the aerospace and automotive sectors, embedded systems technology is also present in everyday objects. These uses present huge commercial opportunities, the limits of which are still far from being reached, since consumer electronics are constantly integrating more and more technologies. For example, the sale of ...

2.4 Embedded systems in the medical field

In the medical field, devices must be reliable and safe so as not to endanger the lives of patients . For example, a badly calibrated machine could irreversibly damage a patient's cells. The machines and their operation must also be protected from cyber attacks or simply from power failures. The risks involved ...

2.5 Embedded systems in defense

The increased use of military hardware and electronics puts pressure on specialized standards for embedded systems for military and aerospace applications. For example, embedded systems for the military and aerospace industry must be able to survive in extreme environments (***). With the military embedded systems market estimated to be worth $***.** billion in ...

2.6 Embedded systems in other industries

The embedded systems, by their very broad fields of application, are a technology used in the majority of the industrial sectors in the majority of industrial sectors, not all of which could be developed in the previous parts of the application. This part aims at detailing the industrial potential in France, ...

3 Market structure

3.1 The market value chain

Various players in the digital technology, engineering and consulting sectors are involved in the various design and construction phases of embedded systems. As software suppliers, they develop the software part of embedded systems. These include software publishers, application publishers, system publishers, network publishers, and development and language tool publishers (***). They also ...

3.2 Production of embedded systems

Production of embedded systems

Strong dichotomy by use

In the case of consumer goods, consumer electronics, automotive, health and industry, industrialists, manufacturers and producers of finished products will generally tend to outsource the production of embedded systems in order to reduce costs and because they lack the required skills and technologies. ...

3.3 The opportunities of a growing market

Embedded systems are present in a wide variety of products, from cars to household appliances, toys and measuring instruments. They represent an interesting market because they are present in many sectors and are a driver of innovation in sectors such as automotive, aerospace, but also in the medical.[***]

By applications, the ...

3.4 A shortage of specialists in the face of rapidly growing demand

The embedded systems market is growing and has good prospects. Thus, the demand for new qualified profiles is strong. The graph below highlights the professions for which the demand for workers is growing the fastest. At the top of the list is Software Engineer/Developer, for which **% of the companies surveyed ...

4 Analysis of the offer

4.1 Prices and parameters

It is difficult to get an idea of the price of embedded systems as a whole, since there are no standard products, but a wide variety of products designed to meet specific needs, all of which fit together in the finished product.

In any case, the actors of the integrated systems ...

4.2 Innovations and supply trends

The digitalization of everyday life through the democratization of connected objects represents a considerable opportunity for embedded systems professionals. The challenge for manufacturers is to create more secure and more open embedded systems to adapt to new needs in different environments. The big challenge is to create learning embedded systems, thus ...

5 Regulation

5.1 Legal framework for the electronic components market

The making available on the market of a product corresponds to "any supply of a product intended to be distributed consumed or used on the Union market in the course of a commercial activity, whether in return for payment or free of charge".

The placing on the market of a product ...

6 Positioning of the actors

6.1 Segmentation of market players

6.2 Recent developments concerning French players

Electronics groups are trying to conquer markets with a high level of innovation, and this is particularly true in the case of artificial intelligence. STMicroelectronics is doing just that, having acquired Toulon-based Cartesiam (***) software, in May **** to strengthen its position in more advanced technologies than it currently offers. Cartesiam's proprietary NanoEdge™ ...

  • Thales
  • Alstom
  • Latecoere
  • Arkeva
  • Actia Groupe
  • Safran Groupe
  • Zodiac Aerospace (Groupe Safran)
  • Schneider Electric
  • Sopra Steria

List of charts presented in this market study

  • Share of electronics in the manufacturing cost of a vehicle
  • Breakdown of Valeo automotive supplier sales
  • Evolution of the size of the embedded systems market
  • Evolution of aeronautical and space construction revenues
  • Breakdown of LATECOERE's sales, aeronautical equipment manufacturer
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Latest news

Thales plans to invest in Atos for defense and intelligence - 30/04/2024
  • - Thales is considering the acquisition of the Mission Critical Systems (MCS) division of Defense and Security within BDS.
  • - Thales's recent €3.6 billion acquisition of Imperva positions Thales in the world's Top 5 in cyber.
  • - The MCS division generates annual revenues of €200-300 million. This amount represents part of the BDS portfolio estimated at 1.5 billion euros.
Thanks to Hitachi's takeover of Thales' rail business, Italy's Mer Mec arrives in France - 15/04/2024
  • - Sale of Hitachi's German, British and French signaling activities to Italian company Mer Mec.
  • - Founded in 1970, Mer Mec is mainly involved in signalling, electrical traction and telecommunications for the rail industry. It is present in 73 countries and belongs to the Angel Group.
  • - The Italian rail specialist already works with RATP and SNCF in France
  • Purchase price of Thales GTS by Hitachi Rail: 1.7 billion euros.
  • - The European Commission and the British competition authority had given the green light to Hitachi Rail's €1.7 billion takeover of Thales GTS (the French group's rail activities). The only condition was that the Japanese manufacturer make a number of divestments.
  • - Number of employees at Hitachi Rail STS France (ex-Ansaldo STS): over 600.
All the lights are green for Thales, except in the space sector - 06/03/2024
  • - Order intake for 2023: 23.1 billion euros
  • - Last year's sales: 18.4 billion euros
  • - Acquisition of US company Imperva
  • - Planned acquisition of Cobham Aerospace Communications
  • - Number of new hires planned in France for 2024: 7,000
  • - Number of employees redeployed within the Thales Alenia Space group: 1,300.
Schneider Electric has had the best year in its history - 16/02/2024
  • Net profit: 4 billion euros.
  • Sales: 36 billion euros.
  • Revenue growth: 13%.
  • Order book for 2024: over 19 billion euros.
  • Market share in electrical infrastructure for data centers: 21% in 2023.
  • Hiring planned as part of this R&D investment: 6,000 people.
  • Sales in the United States: over €10 billion.
  • Schneider market capitalization: over 100 billion euros.
Schneider Electric returns to the exclusive club of companies worth over 100 billion euros - 12/12/2023
  • Schneider Electric has a market capitalization of over 100 billion euros.
  • Schneider Electric forecasts annual sales growth of 7% to 10% between 2023 and 2027.
Alstom: contract worth nearly 820 million euros in Portugal and plans to open a plant there - 09/12/2023
  • Portuguese rail operator Chemins de fer portugais has selected France's Alstom to supply 117 self-propelled trainsets.
  • The contract is valued at 819 million euros.
  • The order includes 62 trains for urban service and 55 for regional service.
  • Alstom estimates that by 2022, two out of every three trains running in Portugal will be manufactured by the company.
  • Alstom opened a new engineering and innovation center in the Porto region in September 2022.
  • The plant and workshop are expected to create 300 direct jobs.

Companies quoted in this study

This study contains a complete overview of the companies in the market, with the latest figures and news for each company. :

Thales
Alstom
Latecoere
Arkeva
Actia Groupe
Safran Groupe
Zodiac Aerospace (Groupe Safran)
Schneider Electric
Sopra Steria

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