Smart Highway Market – Global Industry Size, Share, Trends, Opportunity, and Forecast. Segmented By Technology (Smart Transport Management System, Smart Traffic Management System and Others) By Component (Hardware and Software), By Region 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 56.83 Billion
CAGR (2026-2031)	16.89%
Fastest Growing Segment	Smart Traffic Management System
Largest Market	North America
Market Size (2031)	USD 144.96 Billion

Market Overview

The Global Smart Highway Market will grow from USD 56.83 Billion in 2025 to USD 144.96 Billion by 2031 at a 16.89% CAGR. Smart highways utilize advanced technologies such as sensors, big data analytics, and the Internet of Things to monitor traffic flow, enhance safety, and optimize energy efficiency. The primary drivers propelling this market include the escalating demand for safer transportation networks to combat rising accident rates and the global push towards smart city integration. Additionally, government initiatives aiming to reduce carbon footprints and alleviate traffic congestion through intelligent traffic management systems further sustain market progress.

One significant challenge impeding market expansion is the substantial capital investment required for deploying and upgrading intelligent infrastructure. According to the American Society of Civil Engineers, in 2025, the United States faces a $684 billion funding gap over the next ten years to effectively maintain and improve its roadway network. This financial deficit highlights the difficulties governments face in funding infrastructure projects, which restricts the immediate scalability of smart highway technologies across broader regions.

Key Market Drivers

Substantial government investments in infrastructure modernization are a primary catalyst for the Global Smart Highway Market. Authorities are funding the upgrade of roadway networks with digital technologies to enhance connectivity and operational efficiency. This financial commitment facilitates the deployment of Vehicle-to-Infrastructure (V2I) systems and smart sensors essential for next-generation mobility. For instance, according to the U.S. Department of Transportation, December 2024, in the 'USDOT Issues $130M Worth of SMART Program Grants' announcement, the agency awarded over $130 million to 42 technology demonstration projects. This targeted funding is underpinned by broader infrastructure activity; according to the American Road & Transportation Builders Association, in 2025, state and local governments awarded $22.2 billion in highway and bridge contracts through February alone, signaling a robust environment for integrating intelligent technologies into expanding road networks.

Escalating global traffic congestion further necessitates the implementation of intelligent management solutions. Rapid urbanization has led to gridlocks that incur severe economic costs, compelling cities to adopt AI-enabled monitoring and adaptive signal control. These smart systems optimize traffic flow in real-time, significantly reducing travel delays and fuel consumption. According to INRIX, January 2025, in the '2024 Global Traffic Scorecard', traffic congestion cost the United States approximately $74 billion in lost time and productivity during 2024. This economic burden accelerates the demand for smart highway technologies capable of automated incident detection and dynamic routing to mitigate the financial and operational impacts of saturated transportation corridors.

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Key Market Challenges

The substantial capital investment required for deploying and upgrading intelligent infrastructure stands as a significant barrier to the expansion of the Global Smart Highway Market. Integrating advanced technologies such as sensors, connectivity layers, and data analytics into existing roadway networks involves exorbitant upfront costs that often exceed available public and private budgets. These financial demands force decision-makers to prioritize basic maintenance over technological modernization, leading to the deferral or cancellation of critical smart highway initiatives. Consequently, the difficulty in securing consistent financing restricts the scalability of these projects, preventing the market from achieving widespread adoption and momentum.

This economic strain is further exacerbated by volatile construction costs and supply chain instabilities which directly impede progress. According to the Associated General Contractors of America, in 2024, over 70% of construction firms reported experiencing project delays due to material shortages or price spikes. Such disruptions inflate the already high capital requirements, making it increasingly difficult for stakeholders to commit to long-term infrastructure investments. These delays and budget overruns directly hamper market growth by consuming resources that would otherwise be allocated to new technology deployment, thereby slowing the overall transformation of global transportation networks.

Key Market Trends

The widespread adoption of Cellular Vehicle-to-Everything (C-V2X) communication standards is fundamentally reshaping highway interconnectivity by enabling direct, low-latency data exchange between vehicles and roadside infrastructure. This trend marks a critical departure from legacy short-range communications, as stakeholders prioritize cellular-based protocols that facilitate real-time safety alerts and cooperative traffic maneuvers without relying on continuous network coverage. The momentum for this technology is accelerating as industry roadmaps align with regulatory frameworks to ensure interoperability across borders and manufacturers. According to the 5G Automotive Association, December 2024, in the 'Roadmap for Advanced Driving Use Cases, Connectivity, and Technologies' report, the organization projects that mass deployment of 5G-V2X Direct-enabled vehicles will commence between 2026 and 2029, establishing a foundation for autonomous driving support systems.

Simultaneously, the market is witnessing the emergence of dynamic wireless electric vehicle charging lanes, a transformative technology that allows EVs to recharge their batteries while in motion. This innovation addresses critical barriers to electrification, such as range anxiety and charging downtime, by embedding inductive coils directly into road surfaces to transfer energy to passing vehicles. These systems are moving from experimental phases to functional public deployments, demonstrating the viability of electrified roadways for commercial and transit fleets. According to the Michigan Department of Transportation, September 2024, in the 'Electreon Wireless Charging Performance Results' report, the pilot shuttle operating on the nation’s first public wireless charging road in Detroit successfully received 101.5 kWh of energy wirelessly while driving, eliminating the need for plug-in charging during the detailed operation period.

Segmental Insights

The Smart Traffic Management System segment represents the fastest growing category in the Global Smart Highway Market due to an urgent global emphasis on road safety and congestion reduction. Governments are increasingly adopting intelligent monitoring technologies to optimize traffic flow and reduce accidents. For instance, initiatives supported by the U.S. Department of Transportation encourage the integration of real-time data analytics and automated control systems to manage high vehicle volumes efficiently. This shift allows authorities to address urbanization challenges and environmental concerns by improving existing infrastructure capacity rather than constructing new roads.

Regional Insights

North America leads the global smart highway market due to substantial investments in modernizing transportation infrastructure and enhancing road safety. The United States Department of Transportation actively promotes the integration of intelligent transportation systems to manage traffic congestion and reduce vehicular accidents. Furthermore, the region benefits from a dense concentration of technology developers that facilitate the rapid deployment of monitoring sensors and communication networks. This alignment of government funding with industrial capability secures the position of North America as the primary region in this sector.

Recent Developments

• In March 2025, Valerann was awarded a contract valued at €3.6 million by the European Space Agency to develop a traffic monitoring platform utilizing artificial intelligence and satellite data. The project focused on creating a system to detect incidents and monitor traffic conditions across extensive national road networks, including rural areas that typically lack surveillance infrastructure. By integrating satellite technology with existing data sources, the company aimed to provide road operators with real-time situational awareness and risk profiling. This initiative aligned with broader goals to improve road safety and operational efficiency through advanced data fusion techniques.
• In October 2024, Kapsch TrafficCom completed the deployment of the Bizkaia Connected Corridor on the A8 highway near Bilbao, Spain. This project, spanning approximately 57 kilometers, established the country's first fully connected corridor enabling direct communication between road infrastructure and vehicles. The company installed roadside units and configured a central connected mobility control center to process real-time data. The system was designed to transmit critical alerts regarding weather conditions, roadworks, and congestion to drivers, thereby enhancing traffic flow and safety. This implementation served as a testing ground for cooperative intelligent transport systems and future automated driving technologies.
• In July 2024, Cavnue announced the completion of the initial three-mile pilot segment of the Connected and Automated Vehicle Corridor on Interstate 94 in Michigan. This project, executed in partnership with the state's department of transportation, involved the installation of sensor pods, edge computing nodes, and advanced wireless communication equipment along the highway. The technology created a real-time digital twin of the road to detect potential hazards such as stalling vehicles or debris. This deployment marked a significant step toward a planned longer corridor designed to support the operation of autonomous and connected vehicles while improving safety for traditional traffic.
• In April 2024, Yunex Traffic launched several new intelligent transportation solutions during an industry exhibition in Phoenix. The company introduced a cloud-based advanced traffic management system designed to manage incidents and model emissions without relying on physical roadside detectors. Alongside this platform, the company released a new edge-computing traffic controller and an adaptive signal control solution that leverages artificial intelligence to optimize signal timing. These technologies aimed to enable cities to manage complex road networks more efficiently, improve traffic flow, and enhance safety for vulnerable road users by utilizing data from diverse sources.

Key Market Players

• ALE International
• Cisco Systems Inc.
• IBM Corporation
• Indra Sistemas SA
• Infineon Technologies AG
• Huawei Technologies Co. Ltd.
• Kapsch AG
• LG Electronics Inc.
• Schneider Electric SE
• Siemens AG

By Technology	By Component	By Region
Smart Transport Management System Smart Traffic Management System and Others	Hardware and Software	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Smart Highway Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Smart Highway Market, By Technology:

• Smart Transport Management System
• Smart Traffic Management System and Others

• Smart Highway Market, By Component:

• Hardware and Software

• Smart Highway Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE