Automotive Telematics Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2024-2030)

Automotive Telematics Market Trends & Drivers

Increasing Number of Collaborations and Partnerships Among Industry Players

• One of the major trends witnessed in the automotive telematics market is the increasing number of collaborations and partnerships among different systems providers, original equipment manufacturers (OEMs), telematics solution providers, and other stakeholders.
• For instance, Avis Budget Group Inc. entered into a partnership with Verizon Communications Inc., in order to launch an all-in-one digital travel assistant exclusively for customers of Avis Budget Group Inc. and Payless Car Rental Inc., using Verizon’s nationwide 4G LTE network.

Rising Demand for Improved Safety Features in Vehicles Drives the Market

• The increasing demand for improved safety features in vehicles and more efficient road traffic is the major reason driving the growth of the automotive telematics market.
• Road traffic, serious injuries, and deaths are some unacceptable and confounding outcomes of road transportation, and the primary cause of road crashes and accidents is human error.
• There are various factors that are associated with human drivers, including speeding, lack of attention, and maintaining an unsafe distance from the vehicle ahead, which are primarily responsible for road accidents.
• As per the World Health Organization (WHO), every year, over 1.19 million people die every year due to road accidents globally. India registered the maximum number of road accidents in the world.
• For instance, in 2021, a total of 4,12,432 road accidents were recorded in the country resulting in 1,53,972 lives and causing injuries to 3,84,448 persons. The country was followed by China and the U.S.
• This can be reduced by support offered by different telematics solutions, which provide a safer driving option to the drivers. This is the major factor boosting the market for automotive telematics across the world.

Threat of Cyber Attack and Data Breach

• The increasing use of telematics in vehicles is exposing them to the risks of data breaches and cyberattacks, which is a major restraint hindering the growth of the market.
• Telematics solution is an example of a cyber-physical system, as it has elements of both virtual and physical worlds, thereby resulting in the rise of security issues. This poses risks to the drivers of the vehicles and also jeopardizes the integrity of the technologies used in the vehicles.
• Moreover, the supply chain of the market includes numerous stakeholders, which are also creating difficulty in providing data privacy and cybersecurity.
• Further, there are security risks to networks via which cars communicate using telematics solutions, whether it is a financial network that is used to make payments, electricity infrastructure, roadside sensor network, or traffic control network.
• The cybersecurity-related risks were the first of its kind in the automotive industry. Such serious threats are hampering the growth of the automotive telematics market to a great extent.

Automotive Telematics Industry Outlook

Vehicle Type Insights

• The commercial vehicle category is projected to grow at a higher CAGR, of 10.6%, during 2024–2030. This growth can be ascribed to stringent government regulations as well as an increase in the adoption of cloud-based fleet management telematics solutions by fleet owners, globally.
• Whereas, the passenger car category held a significant market share of 35%. The growing preference among consumers for luxurious, comfortable, and secure cars with remote operation capabilities is driving a significant portion of the passenger vehicle market.
• The integration of advanced automotive telematics systems in vehicles enables features such as locking and unlocking, engine start-stop functionality, and temperature control, enhancing comfort levels. As a result, this category is expected to capture a considerable market share during the forecast period.

During the study, we have analyzed two vehicle types in the report:

• Passenger Car
• Commercial Vehicle (Larger and Faster-Growing Category)

Service Type Analysis

• The safety and security category held the largest market share, of around 50%, in 2023. This is because this service category enables drivers to get benefits such as remote locking and unlocking of their vehicles and roadside assistance.
• In addition, it offers fleet management services, which include a range of functions, such as vehicle financing, vehicle maintenance, and vehicle telematics (tracking and others).
• Whereas, the remote diagnostics category is projected to witness the highest CAGR, of 10.8%, during 2024–2030 in the market. This can be because remote diagnostics service offers efficient on-time solutions to automotive faults by analyzing the vehicle’s health beforehand.
• Moreover, the rising global internet penetration coupled with the growing demand for connected and electric vehicles is driving the remote diagnostics category during the forecast period.

Below are the major services for automotive telematics:

• Safety and Security (Largest Category)
• Infotainment and Navigation
• Remote Diagnostics (Fastest-Growing Category)

Communication Technology Analysis

• The V2V category held a larger revenue share of around 70% in the market in 2023. This is owing to the factors, such as enhanced safety of vehicles equipped with communication systems and stringent government regulations.
• According to a notice of proposed rulemaking (NPRM) by the U.S. Department of Transportation’s NHTSA, the department mandates the integration of V2V and V2I technologies into light vehicles.
• Moreover, according to the NPRM, 100% of all new cars will have dedicated short-range communication (DSRC) technology installed by 2023, increasing from 75% in 2022 and 50% in 2021.
• In addition, the NHTSA stated that V2V or V2I technology could eliminate or reduce the severity of up to 80% of non-impaired driving crashes.

Further, the communication technology analyzed for this report includes:

• Vehicle-to-Vehicle (V2V) (Larger and Faster-Growing Category)
• Vehicle-to-Infrastructure (V2I)

Geographical Outlook

• Geographically, APAC is the fastest-growing market, advancing at a CAGR of 10.8% during 2024–2030, led by China, followed by Japan and South Korea.
• The growth in the APAC market can be attributed to upcoming government regulations for telematics and the affordability of aftermarket systems compared to OE-fitted systems.
• On the other hand, North America held the largest market share, of around 45%, in 2023, led by the U.S. This dominancy is due to the increased governmental regulations.
• For instance, in the U.S., the Federal Motor Carrier Safety Administration (FMCSA) mandated the installation of electronic logging devices (ELD) in commercial vehicles. Such government initiatives provide good ground for innovation and future growth of the automotive telematics industry.
• Moreover, the U.S. has accounted for a major portion of the market revenue in the region till now, due to considerable investments by government and private organizations, coupled with favorable policy frameworks.
• Further, the increasing sales of long-haul trucks in the country will continue to boost the demand for automotive telematics during the forecast period.

Further, regions and countries analyzed for this report include:

• North America (Largest Regional Market)
  • U.S. (Larger and Faster-Growing Country Market)
  • Canada
• Europe
  • Germany (Largest Country Market)
  • U.K. (Fastest-Growing Country Market)
  • France
  • Italy
  • Spain
  • Rest of Europe
• Asia-Pacific (APAC) (Fastest-Growing Regional Market)
  • China (Largest Country Market)
  • Japan
  • India (Fastest-Growing Country Market)
  • South Korea
  • Australia
  • Rest of APAC
• Latin America (LATAM)
  • Brazil (Largest and Fastest-Growing Country Market)
  • Mexico
  • Rest of LATAM
• Middle East and Africa (MEA)
  • Saudi Arabia (Largest Country Market)
  • South Africa
  • U.A.E. (Fastest-Growing Country Market)
  • Rest of MEA

Market Nature - Fragmented

The global automotive telematics market is fragmented in nature, with multiple players operating independently in different countries and cities across the world.

Automotive Telematics Companies News

• SRM Tech and Zonar announced the strategic collaboration to broaden the availability of telematics-enabled solutions to a large number of fleets. This collaboration will incorporate AI and predictive analytics into the telematics of light-duty fleets, providing actionable data analytics to enhance vehicle uptime and boost aftermarket part sales.
• HARMAN specializes in connected technologies and solutions for automotive, consumer, and enterprise markets. It has introduced HARMAN Turbo Connect (TBOT), an advanced software agent designed to predict and resolve vehicle connectivity issues while driving. This latest addition to HARMAN's telematics lineup meets the growing need for fast, low-latency connectivity, particularly when paired with 5G-enabled technologies such as HARMAN's Smart Conformal Antenna and complete 5G and 5G-ready Telecommunications Control Units (TCU).
• Robert Bosch GmbH has launched its RideCare services, featuring a sensor box designed to detect vehicle damage and smoke inside the vehicle. The sensor utilizes cloud-based data analysis along with artificial intelligence to provide information on whether the vehicle has been damaged or if smoking has occurred inside it. Pilot projects are initiated in North America, Asia, and Germany.