The growing importance of connectivity and safety, advancement in smartphone technology, and high-speed internet connectivity have largely transformed the telematics industry. The original equipment manufacturers (OEMs) are increasingly incorporating advanced telematics services in all the commercial vehicle categories owing to the system’s multiple benefits, thereby driving the adoption of automotive telematics.
Read Report Overview: Commercial Vehicle Telematics Market
The global commercial vehicle telematics market accounted for $4.86 billion in 2019 and is expected to reach $5.93 billion by 2025. The market is anticipated to grow at a CAGR of 7.92% during the forecast period 2020 to 2025. The global commercial vehicle telematics market is driven by factors such as increasing safety and security regulations, rising disposable income, lower cost of connectivity, and increased market penetration rate of smartphones. The rising hacking and privacy concerns, and low awareness regarding telematics are some of the factors thatare hampering the overall market growth. However, the growing demand for connected cars, increased adoption of telematics in the insurance industry, and the growth of emerging economies such as India and China are some of the factors thatare expected to fuel the market growth in the forecast period.
Commercial Vehicle Telematics Software Anticipated to Witness Highest Growth
The software segment accounted for the largest market share. Software development cost of the vehicle is usually low, and these services are offered to fleet owners on a monthly subscription fee, along with a subscription lock-in period of usually one/two year. The subscription fee is ranged between $XX to $XX monthly, based on the client requirements. The hardware components have a more affordable price proportion, as these are integrated only once per vehicle at the time of manufacturing unless any hardware part malfunctions.
Fleet Managers Are More Inclined Toward Aftermarket Solution
The aftermarket segment accounted for the largest market share. As aftermarket solution offers a wide range of telematics solutions at a competitive price compared to commercial vehicles OEMs, also it provides a uniform telematics platform to manage CE of different brands. The fleet owners own a large number of commercial vehicles of different brands. In developing countries of Asia and Latin America, numerous fleet owners have commercial vehicles of older and less advanced models or rent them for a shorter duration. In such cases, fleet owners opt for aftermarket telematics on a limited subscription on need-basis.
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Some of the strategies adopted by the companies are new product launches, business expansions, and partnerships and collaborations. Among all the strategies adopted, partnerships and collaborations and product launches have been the leading choices implemented in the competitive landscape. Geotab, CalAmp, Masternaut, Trimble are some of the leading players in the global commercial vehicle telematics market. The industry landscape is quite competitive because of the large number of players in the market. Therefore, innovation and development have been the key factors for large-scale growth in this market. The manufacturers are expanding their businesses and are also entering into strategic partnerships to increase their customer base and overall global footprint.