Intelligent Transportation System Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2025 - 2030)

Intelligent Transportation System Market Size

Intelligent Transportation System Market Trends & Growth Drivers

Environmental Pollution Is Contributing to Market Augmentation

• An intelligent transportation system is able to minimize the environmental impact of land, air, and marine vehicles on human health, via an improvement in air quality.
• Vehicle emissions can be reduced to a great extent by improving traffic flow with the use of improved network management techniques.
• Furthermore, advanced in-vehicle ITS technologies, such as onboard diagnostics, intelligent speed adaptation, and advanced cruise control, offer substantial environmental benefits in terms of fuel efficiency, thus reducing the local carbon emission concentration.
• Additionally, the deployment of dedicated bus lanes and prioritization of bus passages at traffic signals could encourage consumers to shift from private cars to public transport.
• Advanced systems for management information, improved bus patronage, and passenger information provide environmental benefits.
• Moreover, they are also supporting the booming adoption of low-emission vehicles and reducing pollution through low-emission zones and congestion charging.

Growing Traffic Congestion and Emission Level Drive Market Growth

• As road congestion is increasing globally, people are facing more problems, including the wastage of precious time and delays in reaching their destination.
• The improvement in road infrastructure is not an effective solution to the problem of long traffic jams, especially in urban areas.
• Some of the popular solutions implemented to tackle this problem have been building overhead and underground passes, increasing the number of lanes, and making the roads wider.
• However, these solutions are not effective due to the underlying costs.
• Moreover, such development takes a long time and results in an increased length of jams during the process.
• One of the best solutions to reduce traffic congestion is adopting ITS, which manages vehicle flow more efficiently.
• Additionally, passenger travel accounts for more than 50% of all transportation-related emissions, making this process a significant contributor to air pollution.
• Moreover, latest studies suggest that transportation is the biggest contributor to Delhi’s poor air quality.
• Urban traffic congestion and the resulting pollution can be reduced with effective traffic control.
• Moreover, introducing additional options for public movement could compel more individuals to utilize alternative forms of transit, like those that rely on renewable energy and have a less-severe impact on air quality.

High Cost and Data Security Concerns Hamper Market Growth

• The biggest restraint for the ITS market is the high cost of the associated hardware and software.
• Such systems need powerful sensors with integrated IoT connectivity, along with strong internet infrastructure to enable real-time data sharing.
• Similarly, the software that drive the hardware, collect data, and share it with the control room is also expensive.
• Further, to derive maximum value out of these systems, AI and ML algorithms are vital, especially in times of the growing traffic congestion.
• The requirement for regular upgrades and other services further raises expenses, rendering them out of reach in most emerging economies.
• The other main concern with these software-based and internet-enables systems is data security.
• These systems collect, share, and analyze massive volumes of data, which can include details of the vehicle and its owner as well as financial information.
• This can encourage criminals to hack into an unprotected database and steal the information for any purpose.
• There are stringent data privacy regulations in developed countries, and developing countries are also strengthening their laws for the same.

Intelligent Transportation System Market Analysis

Offering Analysis

The services category account for the largest revenue share, of 55%, in 2024, and it is expected to maintain its position during the forecast period. This is due to the need to increase surface transportation network efficiency and connectivity, which requires the proper maintenance of ITS equipment. Additionally, the data stored on the cloud and other storage facilities must be effectively updated and managed, for the proper functioning of the system.

Furthermore, software is expected to grow with the highest rate during the forecast period. The increasing need for data processing, rapid technological advancements, surging usage of visualization software, video detection management software, transit management software, and other ITS software, and the growing IT industry and burgeoning number of software providers propel the market growth.

These offerings have been analyzed:

• Hardware
  • Interface boards
  • Sensors
  • Surveillance cameras
  • Telecommunication networks
  • Monitoring and detection systems
  • Others
• Software (Fastest-Growing Category)
  • Visualization software
  • Video detection management software
  • Transit management software
  • Others
• Services (Largest Category)
  • Business and cloud services
  • Support and maintenance services
  • Others

System Analysis

Advanced traffic management system (ATMS) is expected to keep dominating the market till 2030. This can be attributed to their widespread usage for roadways, increasing number of commuters and vehicles in cities, and growing concerns of people about minimizing pollution levels and traffic congestion. Moreover, ATMS providers are introducing advanced and cost-effective technologies to improve traveling safety, enhance the productivity of mobility service providers, and conserve energy, while protecting the environment.

Advanced public transportation system (APTS) is expected to register the fastest growth during the forecast period, with a CAGR of 7%. The mounting investment in real-time information gathering and analysis for roadways, rising number of public–private partnerships, and need to improve the public transit network’s operational efficiency and passenger services are responsible for the surging demand for APTS. Furthermore, by deploying this solution, fleet providers may raise work efficiency, reduce the accident risk for vehicles and commuters, improve fleet management, and ensure compliance with applicable regulations.

Furthermore, advanced transportation pricing system (ATPS) accounted for a significant intelligent transportation system market revenue share in 2024, and it is expected to grow with a substantial CAGR during 2025–2030. This can be attributed to the availability of cashless travel facility, surging need for saving travel time, and demand for fast toll collection. Moreover, a popular ITS for traveling pricing is the vehicle miles traveled (VMT) fee system, which charges road users on the basis of the miles traveled by them.

The report offers insights into the following systems:

• Advanced Traffic Management System (Largest Category)
• Cooperative Vehicle System
• Advanced Public Transportation System (Fastest-Growing Category)
• Advanced Traveler Information System
• Advanced Transportation Pricing Systems
• Others

Application Analysis

The roadways category holds the largest share, of 40%, and it is further expected to dominate the market during the forecast period. This can be attributed to the huge number of companies that offer such solutions for terrestrial commute, rapid urbanization, increasing traffic congestion in smart cities, burgeoning need for parking management, and growing vehicle ownership rate. In addition, the rising investment in real-time information systems for road transportation propels the market expansion.

Aviation is expected to register the highest CAGR during the forecast period. This is due to the rise in aircraft movements, growth in the need for efficient airline operations, rise in the demand for upgraded security and surveillance measures, and augmentation in the usage of smart ticketing systems due to the rising number of commuters. Additionally, the adoption of airport safety and security solutions, such as CCTV surveillance, access management, air cargo inspection, passenger and baggage screening, secure communication, and intrusion detection and perimeter protection system, will drive the market in the coming years.

The application breakdown of the market is presented below:

• Roadways (Largest Category)
  • Intelligent traffic control
  • Collision avoidance
  • Parking management
  • Passenger information management
  • Ticketing management
  • Emergency vehicle notification
  • Automotive telematics
  • Fleet management and asset monitoring
  • Others
• Railways
  • Rail-running operation and collision avoidance
  • Passenger information management
  • Smart ticketing
  • Security and surveillance
  • Emergency notification
  • Others
• Aviation (Fastest-Growing Category)
  • Security and surveillance
  • Shuttle bus tracking
  • Traveler information management
  • Smart ticketing
  • Aircraft management
  • Emergency notification
  • Others
• Maritime
  • Freight arrival and transit
  • Real-time weather information tracking
  • Container movement scheduling
  • Emergency notification
  • Others

Regional Analysis

North America dominates the market with 40% revenue contribution in 2024. This is attributed to its established IT ecosystem, transportation sector, and telecommunications infrastructure. Essentially, IT, ML, big data analytics, and IoT solutions are easily available in the region, which enables the wide usage of intelligent transportation systems. Moreover, the U.S. has the world’s largest road and rail networks, highest air traffic, as well as the second-largest shipping container traffic. This makes intelligent systems in the transportation sector vital to smoothen movement, reduce emissions, and keep cargo, vehicles, and people safe.

APAC is expected to register the fastest growth, with a CAGR of 8%, during the forecast period. This high-paced growth can be ascribed to the rapid urbanization, developing transportation infrastructure, rising disposable income associated with the enhancing standard of living, growing automobile industry, and rapidly developing road infrastructure in emerging economies, such as China and India.

Moreover, China held the largest revenue share in 2024, and it is expected to maintain its position during 2025–2030, owing to the increasing adoption of new advanced technologies, rising number of daily commuters in the country, and several initiatives taken by the government to reduce emissions.

Europe also accounted for a significant revenue share in 2024, and it is further expected to maintain its position during the forecast period. This can be ascribed to the well-developed automotive industry, stringent regulations regarding emission control, increasing usage of IPTS, and growing concern for road safety.

These regions and countries are part of the scope:

• North America (Largest Regional Market)
  • U.S. (Larger and Faster-Growing Country Market)
  • Canada
• Europe
  • Germany (Largest Country Market)
  • France
  • U.K.
  • Italy
  • Spain (Fastest-Growing Country Market)
  • Rest of Europe
• Asia-Pacific (APAC) (Fastest-Growing Regional Market)
  • China (Largest Country Market)
  • India (Fastest-Growing Country Market)
  • Japan
  • 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 (Fastest-Growing Country Market)
  • Rest of MEA

Intelligent Transportation System Market Share

• The ITS market is highly fragmented due to the wide range of applications of these solutions in all aspects of transportation.
• This raises the need for highly diverse software solutions, while similar kind of hardware can be used.
• Further, most of the companies in the market cater to specific modes of transportation or a few applications associated with them.
• Moreover, with the evolving needs of the transportation sector, the hardware and software need regular modification and customization, allowing an array of providers to flourish.
• Another key factor behind the market fragmentation is the non-standardization of communication protocols across regions and countries.

Intelligent Transportation System Market News

• In October 2024, Cubic Corporation was contracted by the Government of Tanzania to provide mart ticketing solutions for its public transportation system.
• In October 2024, Toshiba Corporation unveiled a new technology for assessing internal damage in concrete decks and bridges. Sensors integrated under the bridge surface analyze vibrations as vehicle pass over it to ascertain damage.
• In September 2024, Siemens AG displayed its Signaling X, a cloud-based solution that helps control and operate mainline as well as mass transit signaling systems and applications from one data center, at InnoTrans 2024.
• In September 2024, Hitachi Ltd. launched Hyper Mobility Asset Expert (HMAX), an AI-driven digital asset management suite for trains, as well as railway signaling and infrastructure, in collaboration with NVIDIA.