TRANSPORTATION PREDICTIVE ANALYTICS AND SIMULATION MARKET ANALYSIS

The global transportation predictive analytics and simulation market was valued at US$ 2,817.5 Mn in 2022 and is expected to grow at a CAGR of 7.7% over the forecast period (2023-2030).

Predictive analytics is the practice of obtaining crucial information from existing data sets, in order to ascertain certain patterns and predict future outcomes and trends. It does predict the future or what will happen rather it forecasts what might happen in the future with some acceptable facts. Predictive analytics is largely used in the transportation sector wherein it provides valuable insights from data collected from numerous sources. These sources include vehicle location systems, on-board sensors, and data collection points embedded in fare and ticketing system and scheduling, and asset management systems. Transportation predictive analytics and simulation software utilizes the extracted data to determine patterns and trends associated with transportation in order to improve the efficiency of transportation operations.

Global Transportation Predictive Analytics And Simulation Market: Regional Insights

Figure 1: Global Transportation Predictive Analytics And Simulation Market Share (%), By Region, 2022

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Global Transportation predictive analytics and simulation market is segmented into North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.

The transportation predictive analytics and simulation market has witnessed significant growth in the recent years, driven by the increasing demand for efficient transportation systems across different regions. North America dominates the market, primarily due to the presence of advanced infrastructure and the early adoption of technology in the transportation sector. The region's well-established logistics and supply chain networks, coupled with the growing need for data-driven decision-making, have fueled the demand for predictive analytics and simulation solutions.

Europe follows closely behind, exhibiting substantial growth in the transportation predictive analytics and simulation market. The European Union's focus on sustainable transportation and smart city initiatives has led to the implementation of advanced analytics and simulation technologies in transportation systems. The region's stringent regulations regarding emissions and traffic management have also created a favorable environment for the adoption of predictive analytics and simulation tools to optimize transportation operations.

Global Transportation Predictive Analytics And Simulation Market - Drivers

Rising number of connected vehicles

The rising number of connected vehicles is expected to drive the growth of the transportation predictive analytics and simulation market over the forecast period. Growing popularity of IoT among consumers has increased the number of connected vehicles in the recent past significantly. OEMs are launching premium as well as mid-range cars with pre-installed sensors. These sensors enable automated driving capabilities, vehicle data tracking, and vehicle to safety pertaining to engine diagnostics and vehicle usage. Furthermore, connected cars can generate information related to traffic flow and density in real-time. This data can be obtained using transportation predictive analytics and simulation software, which facilitates better analysis of traffic flow. For instance, imagine a city that has implemented a smart traffic management system that leverages predictive analytics and simulation. Connected vehicles equipped with sensors continuously transmit real-time data about their location, speed, and traffic conditions to the system's central control hub. For instance, A transportation company implemented a connected vehicle platform to integrate real-time data from their fleet. By using predictive analytics and simulation tools, they gained insights into operations, accurately predicting vehicle maintenance needs, reducing downtime, and improving fleet reliability.

Increasing vehicle traffic volume

Increasing vehicle traffic volumes worldwide is expected to propel the transportation predictive analytics and simulation market growth over the forecast period. The number of vehicles around the world has been increased significantly in the recent past. In 2022, 85.4 million motor vehicles were produced around the world, an increase of 5.7% compared to 2021. This mainly due to significant growth in the transportation infrastructure. Increasing population in cities is exerting pressure on road networks, leading to overcrowded road networks, lack of safe public transportation modes, poor traffic management, parking issues, road safety concerns, and poor road conditions. Predictive analytics and simulation software for transportation collects the data from sensors embedded in vehicles and process it to produce meaningful insights. This analysis can help to manage the road traffic flow efficiently and reduce congestions on the roads. For instance, during a large-scale sporting event or holiday season, there is a significant increase in the number of vehicles on the road, leading to congestion and potential traffic disruptions. To mitigate these challenges, transportation authorities may utilize predictive analytics and simulation tools to optimize traffic flow and alleviate congestion.

Global Transportation Predictive Analytics And Simulation Market - Opportunities

Rising number of smart city projects

The rising number of smart city projects undertaken by the government is expected to offer lucrative growth opportunities. Managing the transportation system of city is a challenging task, which includes road safety, parking management, reduction of traffic congestion, and vehicle-to-vehicle safety. Smart city projects are increasingly rapidly worldwide, owing to proactive government initiatives, growing digitization in various industrial verticals, and rapid adoption of IoT and big data. For instance, in 2021, Spain started a project called The Barcelona Superblock project which is an urban planning initiative aimed at transforming the city's street grids into pedestrian-friendly spaces by limiting traffic and creating vibrant community areas. It involves reconfiguring several city blocks into "superblocks" where vehicle access is restricted, and public spaces are prioritized.

Growing inclination towards data

Many transit companies have been demanding data driven information. Companies, such as Lyft and Uber, use predictive analytics and simulation software where they can determine if the demand is the highest from specific region and whether the required number of fleet of cabs is available in that particular region. Companies sends message to driver in such situations so that they will reach the specific area readily.

Global Transportation Predictive Analytics And Simulation Market -Trends

Growing installation of predictive analytics to reduce risk

With the introduction of IoT, the number of connected devices has increased significantly and is expected to rise further over the forecast period. These devices create large amounts of data, which can be analyzed and used for transportation sector. This data can be used to obtain valuable insights with the help of predictive analytics software, which has increased the demand for the same software.

Growing use of microscopic transportation simulation platforms for planning infrastructure

A number of data analytics transport companies are developing microscopic simulation platforms, since microscopic simulation emphasizes on individual vehicles and their interactions, which in turn, helps traffic engineers and transport planners to evaluate the urban traffic system and suggest suitable infrastructure. For instance, in 2023 Advanced Data Analytics in Transport (ADAIT) team piloted a microscopic simulation on their new smart motorway control system for Sydney M4, which is an arterial route in Sydney, Australia. The simulation showed that travel time savings can reach 40% during peak hours by adding an extra lane to existing route. This also means, it will save around US$ 22 million per annum on part of M4 alone and possibly over US$ 500 million per annum savings to the whole system in Sydney.

 Global Transportation Predictive Analytics And Simulation Market - Restraints

Lack of skilled resources

Lack of skilled resources is expected to restrain the global transportation predictive analytics and simulative market over the forecast period. Predictive analytics and simulation software is complex software to use, where it requires highly skilled operators. These operators should be able to process data refining and preparation, build predictive models, and integrate these models into application environment. Moreover, the problems sway between the lack of skilled operators and the availability of skilled operators at expensive price. This, in turn, is expected to restrain the market growth over the forecast period. To counterbalance this organizations and institutions can invest in training and development programs focused on building the necessary skills for working in the transportation analytics field. This can include providing specialized training in data analytics, statistical modeling, and simulation techniques. By offering comprehensive training, individuals can acquire the knowledge and expertise needed to effectively utilize predictive analytics and simulation tools in transportation planning and decision-making.

Challenges related to data integration

Challenges related to data integration is another factor that may hamper the transportation predictive analytics and simulative market over the forecast period. The data collected from a wide range of systems and multiple sources are heterogeneous, high-dimensional, and highly noisy with complex interdependencies. Such expansive and diverse amount of data can be challenging to process on real-time basis and convert it into useful insights for near-real operations or even for long-term process is extremely challenging. Moreover, low latency and data reliability, which is required to be translated into actionable intelligence to improve safety and for collision avoidance is expected to hamper the market growth over the forecast period.         To counter the challenges related to data integration in the global transportation predictive analytics and simulation market, several strategies can be employed. Firstly, standardization of data formats and protocols can facilitate seamless integration. Establishing industry-wide standards for data collection, storage, and exchange ensures compatibility and interoperability among different systems and stakeholders. This enables the smooth integration of data from various sources and enhances the accuracy and reliability of predictive analytics and simulation models.

Figure 2: Global Transportation Predictive Analytics And Simulation Market Share (%), By Component of Transport, 2022

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Global Transportation Predictive Analytics And Simulation Market - Segmentation

Global Transportation predictive analytics and simulation market is segmented into component, simulation method, development model, component of transport, and region.

In the global transportation predictive analytics and simulation market, by component of transport segment and roadways sub-segment dominated the global transportation predictive analytics market in 2022 accounting for 41.0% shares in terms of value.

Global Transportation Predictive Analytics And Simulation Market: Key Developments

2. In 2020, IBM, a technology company, launched the IBM Sterling Supply Chain Suite which incorporates predictive analytics capabilities. The suite enables businesses to optimize their supply chain operations, enhance visibility, and predict disruptions, thereby improving transportation planning and logistics management.
3. In 2021, Siemens Mobility, a railway company, launched its predictive maintenance system for rail infrastructure. This solution combines predictive analytics and simulation to monitor the condition of railway assets, predict maintenance needs, and optimize maintenance schedules, resulting in increased availability and reliability of transportation systems.
4. In 2021, Cubic Transportation Systems, a subsidiary of Cubic Corporation, unveiled its "NextTraffic" platform. This platform utilizes predictive analytics and simulation algorithms to optimize traffic signal timings and improve the flow of vehicles. It leverages real-time data from connected vehicles and other sources to dynamically adjust signal timings and reduce congestion on road networks.
5. In 2021, PTV Group launched its "Optima" platform, which combines predictive analytics and simulation capabilities to optimize traffic management and transportation operations. The platform uses advanced algorithms to forecast traffic conditions, identify potential bottlenecks, and recommend optimal strategies for traffic management, leading to improved efficiency and reduced congestion.

 Global Transportation Predictive Analytics And Simulation Market: Key Companies Insights

The key companies involved in the global transportation predicative analytics and simulation market are Cubic Corporation, T-Systems International GmbH, IBM Corporation, Tiger Analytics Inc., PTV Group, Cyient-Insights, Xerox Corporation, Predikto Inc., SAP AG, and Space-Time Insight.

Definition: Transportation predictive analytics and simulation refers to the application of advanced analytical techniques and simulation models to predict and optimize various aspects of transportation systems. It involves using historical and real-time data, combined with mathematical algorithms and statistical models, to analyze and forecast transportation patterns, trends, and outcomes. By leveraging predictive analytics and simulation, transportation planners, operators, and policymakers can make data-driven decisions to improve efficiency, reduce costs, and enhance overall transportation performance.