In the recent decades, the automobile telematics industry has witnessed several notable paradigmatic shifts. These have been primarily focused on developing technologies and delivering services that can transform in-car experience, improve safety and security, and support vehicular connectivity. Auto makers world over are increasingly implementing advanced driver assistance systems to offer high levels of comfort and autonomy for drivers. The inclusion of advanced automotive telematics platforms is instrumental in supporting a variety of next-generation infotainment systems and superior connected car experiences. Unarguably, a variety of functionalities enabled by automotive telematics, such as satellite navigation and emergency warnings, continue to allure users in the market.
The use of big data analytics, recent advances made in internet-of-things (IoT) platforms in telematics-enabled devices, have made the analysis of staggering volumes of vehicle metrics possible. This is expected to boost the market in the coming years. The growth in the automotive telematics market is further invigorated by the rising number of use cases for numerous insurers, original equipment manufacturers, and third-party service providers, especially fleet management companies. They are actively finding ways to capitalize on untapped opportunities by developing customized solutions. The market for automotive telematics is headed toward exciting times over the forecast period. According to Transparency Market Research (TMR), the global automotive telematics market is projected to rise at a handsome CAGR of 22.1% from 2017 and 2025, and is forecast to reach US$75.79 bn by the end of 2025.
Which applications of automotive telematics are anticipated to provide ample lucrative avenues in the coming years?
The major applications of the automotive telematics market comprise fleet management, vehicle tracking, vehicle safety communication, and satellite navigation. Among these, the vehicle tracking segment held the major share of the market, accounting to over 30%, in 2016. The segment is projected to rise at the leading CAGR over the forecast period. The growing adoption trailer and container tracking technologies and services in transportation and delivery businesses is fueling the segment. These businesses are increasingly inclined to spend significant amounts in tracking their fleet of products and vehicles. The growth of the segment is fuelled by advancement in network connectivity, including cloud connectivity enabled by Wi-Fi technologies, and high-performing in-car electronics.
Ituran Location and Control Ltd., an Israeli-based company providing vehicle tracking services and wireless communication technologies, has entered joint venture agreement on August, 2017 with Lumax Auto Technologies Ltd. for the sale of its range of products and services to the players of the automotive industry in India. According to the new agreement, the new company so formed will be called Lumax Ituran Telematics Pvt Ltd., in which Lumax Auto Technologies is likely to own 50% while Ituran will own the other half. According to Ituran, with the substantial number of registered cars in India and low penetration telematics in the automotive market, the region offers ample untapped opportunities for the vehicle tracking company. This is attributed to the intensifying need to control vehicle thefts and manage the rapidly growing number of organized cab service providers. In addition, the rising number of fleets and the growing demand for telematics functionalities in commercial vehicles are further expected to provide promising avenues benefitting both the players in the coming years, opines Lumax Auto Technologies.
Meanwhile, the application of automotive telematics for satellite navigation and fleet management is also predicted to rise steadily in the coming years, thereby offering exciting opportunities for market players.
The major regional markets for automotive telematics are North America, Asia Pacific, Europe, the Middle East and Africa, and Latin America. Of these, the Asia Pacific held the leading share in 2016, amounting to over 33.0%. The regional market is projected to retain its dominance throughout the forecast period, primarily fueled by the growing adoption of telematics in automobiles, especially in emerging markets such as India and China. In addition, a major chunk of demand for automotive telematics is anticipated to come from Russia.
The Asia Pacific market is predicted to be trailed by the North America market, with the U.S. expected to provide lucrative avenues to suppliers and developers of automotive telematics.