The automotive telematics market is projected to grow from USD 9.0 Billion in 2024 to USD 16.1 Billion by 2030, at a CAGR of 10.1%. This growth is attributed to the increased vehicle production with enhanced safety features like eCall in Europe, and other countries like Japan, China, and the US have forced manufacturers to deploy embedded telematics in vehicles. The market adoption rate of embedded telematics is expected to expand, fueling the market for automotive telematics solutions during the forecast period.
Increasing use of telematics in fleet management
According to the World Health Organization (WHO), approximately 50% of the world’s population lives in urban areas, and this is likely to increase to around 60% by 2025. Due to the constantly growing urbanization, the demand for e-hailing and car-sharing services has increased, significantly reducing travel costs, traffic congestion, and emissions; hence, their popularity has increased in recent years. Passenger cars and commercial vehicle fleet operators require efficient fleet management solutions to track the vehicles and improve efficiency. Telematics systems provide real-time tracking, monitoring, and analysis of fleet operations, enabling businesses to optimize vehicle usage, reduce costs, and improve overall efficiency. Major companies like UPS and FedEx utilize telematics to track their delivery vehicles, optimize routes, and monitor driver behavior, resulting in significant fuel savings and increased productivity. By leveraging telematics data, fleet managers can identify inefficiencies, such as idle time, unauthorized vehicle use, or inefficient routing, and take proactive measures to address them, leading to operational improvements and cost reductions. For instance, companies like Verizon Connect and Geotab provide comprehensive telematics platforms with predictive maintenance capabilities, helping fleet operators anticipate and address potential issues before they escalate into costly repairs. Thus, to streamline fleet management processes and enhance operational efficiency, the adoption of telematics solutions will continue to increase.
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5G/6G will create futuristic growth opportunities
The enhanced user experience for all telematics solutions depends on wireless connectivity. Many telecom industry players are developing 5G to increase the safety and efficiency of telematics solutions. 5G speeds up V2V and V2I connectivity with greater capacity and uses a wide range of radio spectrum frequencies, allowing more connections than 4G without interference. This provides very low latency, meaning a negligible delay between a signal sent and received. According to the international 5G automotive associations, 68% of accidents can be avoided with the upcoming 5G technology. In countries like the US, China, Germany, and the UK, the newly built TCUs are 5G-enabled, facilitating real-time data transmission and rapid communication between vehicles and the cloud.
To remain aligned with the latest industry trends in 5G technology, several countries collaborate to develop the 5G infrastructure. For instance, the EU and South Korea have signed a deal to work together on 5G development, while both have promised USD 782 million and USD 1.5 billion, respectively, in funding for local 5G projects. In the UK, USD 78 million of funding has been commissioned for a 5G research facility, the 5G Innovation Centre (5GIC). Thus, the evolution of telematics gateway with 5G-enabled connectivity will accelerate growth for intelligent telematics and drive the development of new automotive telematics in the coming years.
Asia Pacific is the largest region in the Automotive Telematics market.
Asia Pacific is expected to be the most lucrative market for automotive telematics. Asia Pacific nations, such as India and China, have witnessed significant automotive production and sales growth over the past few years, particularly in the medium to premium luxury cars. According to MarketsandMarkets analysis, the passenger car production in Asia Pacific is expected to grow from ~43 million units in 2024 to ~47 million units by 2030, with India witnessing the fastest growth rate. The region has an adequate mix of economy and high-end vehicles, depending upon the country’s economic condition. Countries like China, Japan, and South Korea have witnessed significant automotive production and sales growth over the past few years, mainly in the medium to premium luxury cars. With increasing disposable income and evolving consumer preferences, these countries’ demand for premium vehicles equipped with telematics features is rising.
Key Players
The Automotive Telematics Market is dominated by globally established players, such as Robert Bosch GmbH (Germany), Continental AG (Germany), AT&T Inc (US), LG Electronics. (South Korea), and Verizon (US).
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