Market Trends of Global Commercial Vehicle Telematics Industry
The OEM Segment Holds the Largest Share in the Market
- The OEM segment holds a major share in the commercial vehicle telematics market, which emphasizes integrating telematics systems directly into commercial vehicles during manufacturing. This approach provides fleet operators and logistics businesses with comprehensive, embedded solutions. This facilitates the ability to instantly activate and use the fleet management solution, which is driving the adoption.
- OEMs are deploying telematics technology directly into vehicles, offering consumers seamless and integrated solutions, and telematics technology is becoming a crucial part of vehicles. For instance, as per data from the International Organization of Motor Vehicle Manufacturers (OICA), a growing number of commercial vehicles are produced in Asia. China's production volume was 4.03 million in 2023, followed by Thailand, which produced approximately 1.26 million commercial vehicles. Thus, with the growth of production, OEMs are leveraging telematics to enhance their offerings, facilitating features such as advanced driver assistance systems, connectivity, and telematics-enabled services.
- Telematics technology aids in the optimization of a variety of elements, including fuel usage and truck maintenance. Furthermore, the high adoption rate of modern technologies in the commercial vehicle industry, such as AI, machine learning, and advanced driver assistance systems, and the growing demand for autonomous trucks are positively impacting the market's growth.
- The growing product innovations are analyzed to significantly contribute to the market. For instance, in October 2023, Cummins Inc. announced the collaboration with the Eclipse Foundation and Microsoft to introduce the Open Telematics Framework. This innovative framework aims to revolutionize the development of telematics software for commercial vehicles. By enabling companies to craft their telematics applications once and deploy them across any hardware compatible with the Open Telematics Framework, the initiative is expected to reduce time-to-market and operational costs.
- Telematics and connected solutions are pivotal in elevating productivity, performance, safety, and the driving experience in the global commercial vehicle industry. In the coming five years, they are expected to grow in telematics device adoption from medium to heavy-duty trucks.
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Asia-Pacific is Expected to Witness Significant Growth
- Asia-Pacific is expected to hold a significant share of the market, with a significant growth rate during the forecast period, which is largely attributed to the presence of large automotive manufacturers in countries such as China, India, and Japan. The growing government initiatives in the region are further contributing to the market's growth.
- As consumer preferences, regulations, and technology have evolved, vehicles have become increasingly complex during the last decade. Connectivity, autonomy, shared transportation, and electrification investments are expected to continue to grow. Manufacturing centers are expected to spend to become more agile as product complexity grows while continuing to develop lean manufacturing concepts.
- The Chinese government's support for 5G is a significant reason why automakers are rushing to the nation to develop 5G-connected vehicles. For instance, in June 2023, ZTE Corporation, a global leader in information and communication technology solutions, and Tianyi Transportation Technology, a prominent transportation operator, introduced the 5G+ intelligent connected vehicle system at the Mobile World Congress (MWC) Shanghai 2023. This system, integrating Vehicle-Road-Cloud technologies, is expected to drive the automotive industry. The joint partnership was accompanied by the signing of a strategic cooperation agreement, with the commitment to fast-tracking the adoption of autonomous driving services.
- Many original equipment manufacturers (OEMs) are integrating vehicles with telematics technology in Asia-Pacific, allowing seamless connectivity with aftermarket software. This software, tailored for fleet management analytics and commercial insights, is becoming essential. Telematics empowers OEMs to wirelessly collect diverse data to cater to geo-location and maintenance requirements.
- Furthermore, growing product innovations in Asia-Pacific are expected to boost the market's growth. For instance, in January 2024, Tata Motors, India's commercial vehicle manufacturer, announced a milestone achievement by linking 500,000 commercial vehicles to Fleet Edge, its advanced connected vehicle platform. Fleet Edge leverages advanced technologies to increase vehicle uptime and elevate road safety. This facilitated real-time, actionable insights on metrics like vehicle status, health, location, and driver behavior. Fleet Edge empowers owners and fleet managers to optimize operations, reduce logistics expenses, and bolster profitability.
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