Commercial Telematics Is Estimated To Witness High Growth Owing To Integration Of Advanced Technolog
Author : Leena Shedmake | Published On : 05 Feb 2024
Commercial telematics includes a wide range of services in asset tracking and fleet management by using telecommunication and information technologies. Commercial telematics enables fleet operators to access real-time vehicle data, improve driver safety, effectively manage operations, and reduce costs. It offers various advantages such as accurate driver behavior analysis, route optimization, fuel management, and vehicle maintenance notifications. With growing e-commerce industry, there is an increasing demand for commercial telematics solution among logistics companies for efficient transportation of goods.
The global Commercial Telematics Market is estimated to be valued at US$ 63.32 billion in 2023 and is expected to exhibit a CAGR of 12% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.
Market Opportunity:
Integration of advanced technologies such as artificial intelligence and 5G network presents a major market opportunity. AI-based telematics provides advanced fleet management capabilities such as predictive maintenance, personalized in-vehicle services, and automated crash detection. Meanwhile, 5G technology offers lower latency and higher bandwidth which allows real-time data transfer between vehicles and control centers. Integration of AI and 5G is expected to revolutionize the commercial vehicle monitoring and management. Fleet operators can leverage these emerging technologies to maximize ROI and streamline operations over the coming years.
Porter's Analysis
Threat of new entrants: The commercial telematics market requires huge initial investments which acts as a barrier for new players. However, as technology improves costs are coming down making it slightly easier for new players to enter.
Bargaining power of buyers: Buyers have moderate bargaining power in this market as there are many vendors providing similar telematics solutions. However, switching costs are relatively high once a particular solution is deployed.
Bargaining power of suppliers: Key suppliers in this market like chip makers and connectivity providers have some bargaining power given their technological expertise and global presence. However, the threat of forward integration restricts excessive price increase.
Threat of new substitutes: Alternatives like fleet management apps provide some substitute threats. However, full-fledged commercial telematics solutions integrate hardware, software, connectivity and analytics in a seamless manner making substitution a challenge.
Competitive rivalry: The market has numerous global and local players competing intensely on technology, features, pricing and services. This drives newer innovations and upgrades at a fast pace.
SWOT Analysis
Strengths: Rising demand for safety, efficiency and productivity boosts provided. Real-time analytics enable better decision making.
Weaknesses: High initial costs and complex deployment model limits SME adoption. Reliance on cellular connectivity leaves scope for disruptions.
Opportunities: Integration of newer technologies like AI, IoT, 5G offers new use cases. Developing markets yet to adopt fully provide headroom.
Threats: Stricter data privacy laws worldwide increase compliance costs. Open source fleet management solutions exert pricing pressure.
Key Takeaways
The Global Commercial Telematics Market Growth is expected to witness high over the forecast period of 2024-2031, growing at a CAGR of 12%.
North America currently dominates the market due to fast adoption by logistics firms for fleet optimization. Europe follows in terms of market size and is also growing at a fast pace with supportive regulatory environment promoting workplace safety through fleet tracking.
Key players operating in the commercial telematics market are Infineon Technologies AG, Vishay Intertechnology, Inc., Mitsubishi Electric Corporation, STMicroelectronics N.V., Fuji Electric Co. Ltd., Toshiba Corporation, Hitachi Power Semiconductor Device Ltd., Fairchild Semiconductor International, Inc., Semikron Elektronik GmbH & Co. KG, and ABB Ltd. These vendors provide diverse solutions ranging from basic fleet/asset tracking to advanced telematics integrating predictive maintenance. They are focusing on collaborations to build solutions tailored for sectors like transportation, construction, energy.
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