Vehicle Telematics Market Size, Share & Growth
[2022-2029]
Wednesday, February 8, 2023
5:27 PM
The global vehicle telematics market size was valued at USD 64.93
billion in 2021. The market is projected to grow from USD 72.78 billion
in 2022 to USD 213.67 billion by 2029, exhibiting a CAGR of 16.6%
during the forecast period. The global COVID-19 pandemic has been
unprecedented and staggering, with vehicle telematics experiencing
lower-than-anticipated demand across all regions compared to prepandemic levels. Based on our analysis, the global vehicle telematics
market exhibited a growth of 4.3% in 2020 as compared to 2019.
Vehicle telematics offers several benefits for drivers worldwide. This
technology enables routing, improved logistics, and increased fuel
efficiency. It aids in retrieving stolen vehicles, identifying underutilized
assets, and reducing accident frequency and severity. The rise in
popularity of connectivity solutions in cars and the implementation of
necessary high-cost infrastructure are increasing consumer awareness
and demand for automotive telematics solutions. These factors, in
turn, are fueling the vehicle telematics market growth.
COVID-19 IMPACT
Accelerated Focus on Domestic Semiconductor Manufacturing
Triggered Market Growth
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Accelerated Focus on Domestic Semiconductor Manufacturing
Triggered Market Growth
The pandemic-induced lockdown in 2020 led to a severe downturn in
vehicle production as factories were compelled to close down or
operate at reduced capacity after production resumed at the end of Q2
2020.
Lockdown measures caused production and demand disruptions to
automobile manufacturers and their sub-contractors. Furthermore,
restrictions were lifted across different sectors and countries at a
different pace, resulting in input shortages in the automobile industry’
complex value chains. For instance, production decreased by 19% in
the U.S. and more than 30% in South America, with a decline of nearl
32% in Brazil.
The vehicle telematics industry recovered far quicker than anticipated
in 2020, and consumers' demand for new vehicles was resilient.
However, as facilities closed due to pandemic-induced shutdowns,
semiconductor chip and wafer suppliers redeployed capacity to other
sectors such as consumer electronics. Due to their complexity, these
chips have extremely long lead times (around 26 weeks). Hence, chip
makers have been unable to fulfill the sudden ramp-up in demand.
This shortage has led automakers to cut production in 2021.
Several governments have introduced long-term plans to reduce the
dependency on a small number of semiconductor chip manufacturers
in Asia Pacific. Major manufacturers, such as United Microelectronics
and Taiwan Semiconductor Manufacturing, have announced plans to
increase production capacities. These factors will aid the recovery of
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Several governments have introduced long-term plans to reduce the
dependency on a small number of semiconductor chip manufacturers
in Asia Pacific. Major manufacturers, such as United Microelectronics
and Taiwan Semiconductor Manufacturing, have announced plans to
increase production capacities. These factors will aid the recovery of
the market.
The pandemic also had a positive impact in terms of the increasing
comfort level of consumers with the installation of telematics devices
in their vehicles for various purposes. For instance, in May 2019, Arity
(a key player in the telematics industry) surveyed 875 drivers over 18
The survey was conducted to understand how many would be
comfortable using typical telematics variables such as speeding,
distracted driving, number of miles driven, and where and when they
drive to adjust their insurance premiums.
However, in May 2020, the company re-ran this survey with more tha
1,000 licensed drivers. Nearly 50% of drivers (a 12% year-on-year
increase) were comfortable with having their insurance adjusted based
on where they drive, what time of day they drive, and the number of
miles they drive along with speeding and distracted driving.
Hence, these factors will positively influence the growth of the market
in the long term.
LATEST TRENDS
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LATEST TRENDS
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Increasing Adoption of Telematics-based Insurance to Augmen
Market Growth
There has been a growing demand for vehicle telematics-based
insurance policies, and they are expected to increase in variety with
the rapid adoption of telematics systems during the forecast period.
Automakers recognize that being the hub that collects vehicle and
driver information from in-vehicle embedded telematics devices gives
them an excellent position to sell data to insurers or distribute
insurance themselves. Additionally, automakers can broaden their
financial services portfolio by offering data-driven insurance at the
point of sale and support brand differentiation by providing valueadded services.
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point of sale and support brand differentiation by providing valueadded services.
Hence, implementing telematics systems in automobiles represent a
significant opportunity for automakers to reduce costs and create new
profitable avenues by repositioning themselves along the insurance
value chain. These factors will positively influence the growth of the
market.
DRIVING FACTORS
Improved Operational Efficiency for Fleet Management
Companies to Augment Telematics Demand
Fleet managers can use some telematics devices to create more
efficient routes. Tracking how and where vehicles operate can improve
driver productivity, dispatching, customer delivery times, and service
levels. Managers can identify opportunities to improve vehicle
availability and reduce unintended expenses associated with
unauthorized use by tracking the vehicles.
Fuel consumption can be reduced with the help of telematics devices
by tracking idle time and maximizing efficiency on customer stops.
This factor supports the company's emission-reduction initiatives and
sustainability goals. These factors will fuel the growth of the market.
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This factor supports the company's emission-reduction initiatives and
sustainability goals. These factors will fuel the growth of the market.
Benefits of Vehicle Telematics such as Improved Safety &
Vehicle Maintenance to Boost Market Growth
Navigation and logistics tools are also only a small part of telematics
systems. These systems offer fleet operators valuable risk assessment
data and clear insight into the regular safety performance of drivers.
Fleets using the aforementioned data and systems to detect hazardou
driving habits also generally experience low losses and accidents. Flee
managers can mitigate potential risks by offering constructive driver
feedback using the telematics data. When a risky driving maneuver
occurs, real-time audible alerts will be sent to drivers so they can
quickly alter their driving patterns.
Inefficient or costly driving performance that leads to unnecessary
wear & tear can also be identified using telematics devices. Vehicle
downtime can be reduced by alerting fleet managers to overdue
routine maintenance and other potential vehicle problems. Fleet
managers can have expensive assets with a lengthier useful life as
they can be more proactive with maintenance repairs. Hence, these
factors will drive the growth of the market.
RESTRAINING FACTORS
Differing Rate between Advancement of Telematics Technology
will Restrain Market Growth
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Differing Rate between Advancement of Telematics Technology
will Restrain Market Growth
According to the study, Analysis of Automotive Telematics Industry in
Japan, clock speed analysis is a method of understanding supply chain
design, modular architecture, and product lifecycle acceleration to
maintain or create a competitive advantage. The product tech clock
speed, process tech clock speed, and organizational clock speed for
automobiles are 4-6 years, 4-6 years, and 10-15 years, respectively.
For semiconductors, it is 4-6 years, 2-3 years, and 3-10 years,
respectively. For personal computers, it is less than six months, 2-4
years, and 2-4 years, respectively.
A boundary is created when two industries that evolve at different
clock speeds come together. Regarding telematics, the pace of
evolution differs significantly as the hardware and software that
makeup telematics evolve rapidly. Hence, OEMs are under unwanted
stress to provide vehicles and speed up upgrades for telematics
products & services to avoid repeated obsolescence. Therefore, these
factors can negatively influence the growth of the market.
SEGMENTATION
By Service Analysis
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By Service Analysis
Fleet/Asset Management to Dominate Market Owing to Benefit
such as Improved Operational Efficiency
By service, the global market is segmented into information &
navigation, safety & security, fleet/asset management, insurance
telematics, infotainment system, and others.
The fleet/asset management segment held the largest share of the
market and is also expected to grow faster during the forecast period.
Fleet management services permit operators to collect and store
engine error data, locate vehicles on-demand, and identify dangerous
driver habits, including harsh braking, idling, and speeding. For fleet
operators, this driver data is invaluable. Hence, helping fleet operators
cut costs through their operation will propel the growth of this
segment.
The insurance telematics segment is expected to exhibit a high CAGR
during the forecast period. Greater consumer comfort with sharing
driving data and benefits such as premium reductions with
personalized insurance offerings based on a user’s driving parameters
will lead to the segment's growth.
By Technology Type Analysis
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idling, and speeding. For fleet operators, this driver data is
invaluable. Hence, helping fleet operators cut costs through
their operation will propel the growth of this segment.
The insurance telematics segment is expected to exhibit a high
CAGR during the forecast period. Greater consumer comfort
with sharing driving data and benefits such as premium
reductions with personalized insurance offerings based on a
user’s driving parameters will lead to the segment's growth.
By Technology Type Analysis
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Embedded Systems Held Largest Market Share Due to
Better User Experience
Embedded Systems Held Largest Market Share Due to
Better User Experience
Based on technology type, the market is segmented into
embedded, tethered, and integrated.
The embedded segment held the largest market share in 2021.
In embedded systems, connectivity is offered through a built-in
telematics control unit that ensures constant connection and a
better user experience. The assurance of continuous
connectivity along with rich user experience leads to increased
adoption of embedded vehicle telematics.
The integrated segment is anticipated to exhibit a higher CAGR
during the forecast period. Consolidation of hardware
components into a single device, which reduces cost and faster
response time for fleet managers will surge the demand for
integrated solutions.
By Sales Channel Analysis
OEM Segment Dominated the Market Owing to Low
Operational Difficulty and Constant Upgradation
OEM Segment Dominated the Market Owing to Low
Operational Difficulty and Constant Upgradation
Based on sales channel, the market is segmented into OEM and
aftermarket.
The OEM segment held the largest market share in 2021.
Factory-fitted telematics units offer low hassle and low-cost
advantages. Additionally, the software is a significant point of
focus for OEMs. In 2022, Mercedes-Benz opened a new
software center to enhance in-house software capabilities.
Stellantis is looking to hire more software developers to create
additional revenue from software-driven features.
Consequently, the variety of available useful data will also grow
rapidly. Hence, these factors will lead to a dominant share of
OEM solutions in the market.
The aftermarket segment is also expected to witness promising
growth during the forecast period. Aftermarket solutions
require installation, troubleshooting, and periodic replacement
of obsolete units, and they need to be reinstalled properly after
every servicing, creating a substantial logistics burden.
Additionally, low-cost external hardware is also more
susceptible to cybersecurity risks. Hence, these factors will
negatively influence the growth of the segment.
By Vehicle Type Analysis
By Vehicle Type Analysis
Passenger Cars Held Largest Market Share Supported by
Consumer Demand for Connected Mobility Solutions
Based on vehicle type, the market is segmented into passenger
cars and commercial vehicles.
The passenger cars segment held the largest market share in
2021. Consumer purchasing preferences have witnessed a
rapid shift, and telematics is a highly desired system by
consumers. The rising demand for safety and conveniencerelated services, such as fuel & routing optimization, vehicle
maintenance alerts, real-time tracking, and stolen-vehicle
recovery, will drive the segment's growth during the forecast
period.
The commercial vehicles segment is anticipated to exhibit a
higher growth rate during the forecast period. Fleet operators
can maximize uptime, enhance safety, and optimize
operations. With the aid of telematics solutions, cost-saving
opportunities can be identified and operators can deploy
programs to implement corrective measures. These factors are
attributed to the positive growth for the segment.
REGIONAL INSIGHTS
REGIONAL INSIGHTS
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North America dominated the vehicle telematics market share
(with the U.S. accounting for most of the share), and it stood
at USD 23.94 billion in 2021. The rising security and safety
concerns of drivers and passengers and the focus on
preventing accidents are the foremost factors contributing to
the adoption of telematics in this region. Moreover,
government norms that favor automotive telematics are
boosting the market growth.
For instance, in January 2022, the U.S. government recently
signed a contract with Geotab to equip 217,000 vehicles with
fleet management telematics technology. Several insurance
companies in North America use telematics solutions to
minimize the risk by tracking various aspects such as usage,
security, and maintenance. Hence, these factors are attributed
to the region's larger market share.
Europe is expected to show significant growth in the market
due to steadily declining hardware costs. Aftermarket suppliers
offer systems at no upfront cost while the services and
hardware cost are distributed over fixed contract periods. The
entry of established OEMs that provide warranties and offer
Europe is expected to show significant growth in the market
due to steadily declining hardware costs. Aftermarket suppliers
offer systems at no upfront cost while the services and
hardware cost are distributed over fixed contract periods. The
entry of established OEMs that provide warranties and offer
solutions supported via dealerships will further aid market
development.
The Asia Pacific vehicle telematics market is expected to exhibit
a higher CAGR during the forecast period. In recent years, the
number of Telematics Service Providers (TSPs) in China and
India has increased substantially. In 2021, Tech Mahindra (an
Indian IT company) conducted a survey (of Indian consumers)
to understand the awareness level and buying behavior for
automotive telematics technologies.
The survey shows around 90% of respondents prefer buying a
four-wheeler with telematics technology. The demand for
vehicle navigation in entry-level cars, escalating fuel prices,
and fear of theft will further propel the demand for this
technology.
KEY INDUSTRY PLAYERS
Webfleet Solutions Holds a Larger Market Share Owing
to Productive Partnerships and Industry Leading
Products
to Productive Partnerships and Industry Leading
Products
Webfleet Solutions (previously known as TomTom telematics)
is one of the leading telematics solution providers dedicated to
fleet management, connected car, and vehicle telematics
services. The company’s main Software-as-a-Service solution,
WEBFLEET is utilized by businesses of various sizes to enhance
vehicle performance, save fuel, support drivers, and improve
overall fleet efficiency.
Additionally, Webfleet Solutions provides services for rental,
insurance, and leasing industries, car importers, and firms that
address the requirements of businesses and customers. The
company has over 50,000 customers worldwide and service
centers in over 100 countries globally. These factors have
enabled the company to capture a larger market share.
LIST OF KEY COMPANIES PROFILED:
• Robert Bosch GmbH (Germany)
• Webfleet Solutions B.V. (Netherlands)
• MiX Telematics (South Africa)
• Trimble (U.S.)
• MiX Telematics (South Africa)
• Trimble (U.S.)
• Verizon (U.S.)
• Zonar Systems (U.S.)
• Octo Group S.p.A (Italy)
• Microlise Telematics Pvt. Ltd. (U.K.)
• Harman International (U.S.)
KEY INDUSTRY DEVELOPMENTS:
• December 2021 – Trimble announced that it acquired
AgileAssets, an asset management software provider to
government and private organizations (including statelevel transportation agencies and national road authorities
in the U.S.). AgileAssets’ asset management solutions will
offer organizations advanced analytics for real-time
decision-making and insights for maintenance operations
and efficiency management.
in the U.S.). AgileAssets’ asset management solutions will
offer organizations advanced analytics for real-time
decision-making and insights for maintenance operations
and efficiency management.
• December 2021 – In partnership with the parent
company Continental AG, Zonar launched the Light Duty
Telematics Control Unit (TCU). The Zonar LD TCU is
specially designed to meet the evolving requirements of
light-duty vehicles within fleets, including access to
telematics data and diagnostics to improve security,
efficiency, and performance.
• November 2021 – Bosch introduced Ridecare solutions
for fleet managers. Ridecare solutions are specially
designed for a fleet of vehicles or ride-sharing services to
reduce the skyrocketing maintenance cost due to damage
or misuse of the vehicle. Bosch’s Ridecare solutions utilize
a single sensor box. This box is highly sensitive and can
detect minor scrapes such as fender scuffs or underbody
dings. It can even tell if the occupant has been smoking
inside the vehicle during the rental period.
• September 2021 – Trimble announced that its eDriver
Logs Electronic Logging Device (ELD) software had been
certified to comply with the technical needs of the
Canadian ELD mandate. The certification applies to using
eDriver Logs ELD when paired with Trimble’s PeopleNet
Mobile Gateway hardware.
• January 2021 – Mercedes-Benz Connectivity Services
joined Webfleet’s OEM.connect partner program. This
factor allows Mercedes-Benz vans and passenger cars with
factory-fitted connectivity to connect with WEBFLEET,
Webfleet Solutions’ service platform.
factor allows Mercedes-Benz vans and passenger cars with
factory-fitted connectivity to connect with WEBFLEET,
Webfleet Solutions’ service platform.
REPORT COVERAGE
An Infographic Representation of Vehicle Telematics Market
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The market report covers a detailed market analysis. It focuses
on key aspects such as leading companies, product types, and
leading vehicle telematics applications. Besides this, the report
offers insights into the market trends and highlights key
The market report covers a detailed market analysis. It focuses
on key aspects such as leading companies, product types, and
leading vehicle telematics applications. Besides this, the report
offers insights into the market trends and highlights key
industry developments. In addition to the abovementioned
factors, the report delivers an in-depth electric bike market
analysis of several key factors that have contributed to its
growth in recent years.
Report Scope & Segmentation
ATTRIBUTE
DETAILS
Study Period
2018-2029
Base Year
2021
Base Year
2021
Estimated Year
2022
Forecast Period
2022-2029
Historical Period
2018-2020
Unit
Value (USD
billion)
Segmentation
By Service
• Information
& Navigation
• Safety &
Security
• Safety &
Security
• Fleet/Asset
Management
• Insurance
Telematics
• Infotainment
System
• Others
By Technology Type
• Embedded
• Tethered
• Integrated
By Sales Channel
• OEM
• Aftermarket
By Vehicle Type
• Passenger Cars
• Commercial Vehicles
By Geography
• North America (By Service, By
By Geography
• North America (By Service, By
Technology Type, By Sales Channel, By
Vehicle Type)
• U.S. (By Vehicle Type)
• Canada (By Vehicle Type)
• Mexico (By Vehicle Type)
• Europe (By Service, By Technology
Type, By Sales Channel, By Vehicle
Type)
• U.K. (By Vehicle Type)
• Germany (By Vehicle Type)
• France (By Vehicle Type)
• Rest of Europe (By Vehicle Type)
• France (By Vehicle Type)
• Rest of Europe (By Vehicle Type)
• Asia Pacific (By Service, By Technology
Type, By Sales Channel, By Vehicle
Type)
• China (By Vehicle Type)
• Japan (By Vehicle Type)
• India (By Vehicle Type)
• South Korea (By Vehicle Type)
• Rest of Asia Pacific (By Vehicle
Type)
• Rest of the World (By Service, By
Technology Type, By Sales Channel, By
Vehicle Type)