ID: PMRREP3318
Format: PPT*, PDF, EXCEL
Last Updated: 24 Jul 2018
Industry: Automotive & Transportation
Number of Pages: 179
The automotive telematics market is estimated to reach a valuation of US$69.8 Bn by the year 2031, at a CAGR of 16%, during the forecast period 2024 to 2031.
Key Highlights of the Market
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Market Attributes |
Key Insights |
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Automotive Telematics Market Size (2024) |
US$24.7 bn |
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Automotive Telematics Market Size (2031) |
US$69.8 bn |
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Forecast Growth Rate (CAGR 2024 to 2031) |
16% |
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Historical Growth Rate (CAGR 2018 to 2023) |
14.7% |
Automotive telematics combines telecommunication and informatics to provide various services, such as navigation, safety and security to vehicles. The key functions of telematics are vehicle tracking, trailer tracking, container tracking, car sharing, emergency warning systems for vehicles and others.
One of the main reasons for the growing popularity of vehicle telematics systems in different countries is the increased emphasis placed by auto manufacturers on integrating these systems into both passenger vehicles and commercial vehicles.
Moreover, increased customer knowledge about the advantages and enhanced understanding of the vehicle's performance and driver behavior patterns are also impacting fleet owners and vehicle fleet managers, compelling them to use telematics systems in their vehicles.
The growth of the vehicle telematics market is being further fuelled by increasing customer awareness and the growing adoption of these systems by OEMs, and aftermarkets.
The global automotive telematics market witnessed significant growth and transformation from 2019 to 2023, driven by technological advancements, increasing consumer demand for connected vehicles, regulatory mandates, and the integration of advanced analytics and AI-driven insights into automotive systems.
In 2019, the market laid the foundation for its subsequent growth, characterized by increasing awareness and adoption of telematics solutions among automakers and consumers alike.
Telematics, encompassing GPS tracking, vehicle diagnostics, and real-time communication technologies, began gaining traction as automakers sought to enhance vehicle safety, optimize fleet management operations, and improve the overall driver experience.
In 2023, the market continued its upward trajectory with diversified applications across passenger vehicles, commercial fleets, and emerging electric and autonomous vehicle segments.
The integration of 5G technology further enhanced the speed and reliability of telematics data transmission, supporting real-time updates and seamless connectivity between vehicles, infrastructure, and external platforms.
Increased Consumer Demand for Connected Vehicles
Increasing consumer demand for connected vehicles and personalized in-car experiences is a significant driver shaping the automotive telematics market.
Modern consumers seek vehicles equipped with advanced telematics features that offer enhanced connectivity, entertainment options, navigation assistance, and real-time vehicle monitoring capabilities.
Telematics systems provide seamless integration with smartphones, enabling drivers to access vehicle data remotely, receive maintenance alerts, and benefit from enhanced convenience and safety features.
The popularity of connected car services such as remote vehicle diagnostics, over-the-air (OTA) software updates, and integrated infotainment systems drives automakers to embed sophisticated telematics solutions into their vehicle offerings, catering to tech-savvy consumers' expectations for enhanced connectivity and digital experiences.
Operational Efficiency and Cost Savings
Telematics solutions offer significant operational efficiencies and cost savings for fleet operators, logistics companies, and commercial vehicle owners.
Fleet telematics enables real-time monitoring of vehicle performance, fuel consumption, driver behavior, and route optimization, leading to improved fleet management, reduced fuel costs, enhanced driver safety, and minimized vehicle downtime.
These operational benefits drive the adoption of telematics systems across commercial and industrial sectors, promoting efficiency gains and profitability.
Technological Advancements
Technological innovation stands as a primary driver fuelling the expansion of the market. Advancements in IoT (Internet of Things), AI (Artificial Intelligence), cloud computing, and connectivity solutions have revolutionized telematics capabilities.
These technologies enable seamless integration of telematics systems with vehicles, smartphones, and external platforms, facilitating real-time data exchange, remote diagnostics, predictive maintenance, and fleet management optimization.
The deployment of 5G technology enhances data transmission speeds and reliability, supporting high-bandwidth applications like video streaming, autonomous driving systems, and V2X (Vehicle-to-Everything) communication, thereby enhancing the functionality and efficiency of telematics solutions.
Data Privacy and Security Concerns
Data privacy and security are paramount concerns in the automotive telematics market. Telematics systems collect and transmit sensitive data, including vehicle location, driving behavior, and personal information.
As vehicles become more connected and data-driven, ensuring robust cybersecurity measures to protect against unauthorized access, data breaches, and misuse becomes critical.
Stringent data protection regulations, such as the General Data Protection Regulation (GDPR) in the European Union and similar laws in other regions, impose strict requirements on the collection, storage, and sharing of personal and vehicle data. Automakers and telematics service providers must comply with these regulations to mitigate legal risks and maintain consumer trust.
Concerns over data privacy and security can undermine consumer trust in telematics systems. Potential customers may hesitate to adopt telematics-enabled vehicles or services if they perceive risks to their personal privacy or data security.
Building transparency, implementing strong encryption protocols, and adopting privacy-enhancing technologies are essential to addressing these concerns and fostering consumer confidence.
Infrastructure Limitations, and Connectivity Challenges
The effectiveness of automotive telematics systems heavily depends on reliable and robust communication infrastructure. Challenges related to network coverage, bandwidth limitations, and connectivity issues in remote or underserved areas can hinder the seamless operation of telematics services.
In regions with inadequate cellular network coverage or limited broadband connectivity, telematics systems may experience disruptions in data transmission and real-time communication.
This can impact the reliability of features such as GPS navigation, emergency assistance, and remote diagnostics, affecting the overall user experience and utility of telematics solutions.
The cost associated with maintaining reliable connectivity for telematics-enabled vehicles can be significant, especially for fleet operators managing large numbers of vehicles across diverse geographic regions.
High data usage charges and subscription fees for cellular services can add operational expenses, influencing cost-effectiveness considerations for adopting telematics solutions.
Expansion of Connected and Autonomous Vehicles
The proliferation of connected and autonomous vehicles (CAVs) represents a significant growth opportunity for automotive telematics. Connected vehicles rely on telematics systems to enable features such as real-time navigation, remote diagnostics, vehicle-to-infrastructure (V2I) communication, and over-the-air (OTA) software updates.
As autonomous driving technologies advance, telematics will play a crucial role in supporting vehicle-to-vehicle (V2V) communication and enhancing the safety and efficiency of autonomous fleets.
Industry participants can capitalize on developing telematics solutions tailored for CAVs, including enhanced sensor integration, AI-driven analytics, and cybersecurity measures to support the safe and efficient operation of autonomous vehicles.
Telematics systems will enable autonomous vehicles to collect and analyse vast amounts of data, optimize route planning, and communicate with surrounding vehicles and infrastructure seamlessly.
Embedded Technology Captures over 48% Market Share
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Market Segment by Technology |
Market Value Share 2023 |
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Embedded |
48% |
Based on technology, the automotive telematics market is further classified into embedded, tethered and integrated, where the embedded segment dominates the market. It is anticipated that the embedded category would have a commanding presence in the market, with a substantial market share.
Embedded telematics provides a built-in system that monitors vehicle performance and ensures uninterrupted connectivity. Like smartphones, a cellular modem is installed inside the vehicle. This modem enables the car to establish connections with other devices via a cellular network, such as mobile phones.
The majority of vehicle manufacturers offer built-in telematics in the majority of their vehicle models. Approximately 80% of new vehicles in the United States are equipped with integrated telematics systems.
Passenger Cars Remain the Dominant Adopter
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Market Segment by Vehicle Type |
Market Value Share 2023 |
|
Passenger Cars |
60% |
Based on vehicle type, the automotive telematics market is further divided into passenger cars and commercial vehicles, where the passenger cars segment dominates the market share.
The growth of the passenger cars segment is expected to be driven by consumers' increasing preference for advanced vehicles and their inclination towards telematics systems that offer innovative applications.
The factors include roadside assistance, emergency applications, real-time vehicle tracking, vehicle maintenance alerts, engine health monitoring, and other comprehensive vehicle insights.
Furthermore, the increasing preference of consumers for electric automobiles equipped with innovative features is anticipated to further propel the expansion of market segment.
Europe Dominates with 28% Market Share
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Region |
Market Value Share 2023 |
|
Europe |
28% |
Europe held most of the global automotive telematics market share in-vehicle telematics. The increasing emphasis of governments and car manufacturers on accident prevention and the safety and security of passengers and drivers is driving the expansion of the market in the area.
Furthermore, the automotive telematics market expansion in this region is expected to be further propelled by strategic collaborations among industry competitors aimed at enhancing their standing.
Further, North America ranked second in terms of market share. The surge in electric car sales in the US is a significant catalyst for the market's expansion in the region. Furthermore, the increasing government assistance in adopting vehicle fleet management technologies is driving the growth of the regional market.
Asia Pacific and other regions are projected to experience substantial growth in the forecast future due to increasing consumer awareness and strong demand for telematics systems across various applications.
Moreover, the market in Asian regions is anticipated to experience growth during the forecast period due to the rising use of telematics systems in newly announced vehicle models.
The global automotive telematics market is highly competitive, driven by technological advancements, regulatory requirements, and evolving consumer preferences for connected vehicle solutions. Key players in the market are strategically focused on innovation, partnerships, and geographic expansion to gain a competitive edge and enhance automotive telematics market share.
As the market continues to evolve with advancements in connectivity, autonomous driving, and regulatory compliance, industry participants that innovate, collaborate strategically, and deliver superior customer experiences will be well-positioned to capitalize on growth opportunities and shape the future of connected mobility solutions.
Recent Industry Developments
In Jan 2024, Continental AG and Google Cloud formed a partnership, unveiling a new era of customized travel at CES 2024 during the IAA Mobility event.
In Nov 2023, at the 6th China International Import Expo (CIIE 2023), Robert Bosch GmbH introduced its cutting-edge intelligent driving solutions for China.
In Mar 2023, Continental AG, and HERE Technologies formed a cooperation to equip IVECO's commercial vehicles in Europe with "Intelligent Speed Assistance" (ISA) and fuel-saving features. The delivery of these services is facilitated by Continental's eHorizon platform, which consolidates and distributes HERE map content.
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Attributes |
Details |
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Forecast Period |
2024 – 2031 |
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Historical Data Available for |
2018 – 2023 |
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Market Analysis |
US$ Billion for Value |
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Key Regions Covered |
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Key Companies Profiled |
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Pricing |
Available upon request |
By Technology
By Sales Channel
By Vehicle Type
By Region
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