APAC Automotive Telematics Market is estimated to be valued at USD 25.07 Bn in 2024, exhibiting a CAGR of 14.4% over the forecast period 2024-2031. Increasing demand for advanced safety features and governments enacting stringent regulations regarding vehicle safety can drive the automotive telematics market in APAC region. Furthermore, rising demand for over-the-air updates and real-time diagnostics also drives the market growth.
Market Dynamics:
Increasing demand for safety features: With rising road accidents, consumers are increasingly demanding advanced safety features such as emergency calling, remote diagnostics, vehicle tracking, and others. Automotive telematics provides these safety features by continuously monitoring the vehicle and driver behavior.
Government regulations: Various governments in Asia Pacific have enacted stringent regulations mandating safety features like e-call in newly manufactured vehicles. For instance, China made e-call mandatory in new vehicles in 2020. Such regulations boosts demand for automotive telematics units in the region.
Market Driver: Growing adoption of connected and autonomous vehicles
Connected and autonomous vehicles rely heavily on telematics systems to communicate with other vehicles and infrastructure on the road. Growing focus on developing connected and self-driving car technologies in the APAC region boosts demand for telematics systems. Countries like China, Japan, South Korea and Singapore are investing heavily in 5G networks and V2X communication standards that will power the next generation of connected mobility. Automakers in these nations are launching new models with advanced driver assistance and autonomous driving capabilities that require sophisticated telematics and sensor technology. Rising demand for connected mobility solutions to reduce congestion and emissions can drive the market growth.
Market Driver: Increasing safety and security concerns of drivers and passengers
Safety has always been a top priority for drivers and passengers. Telematics provides real-time crash notification, emergency calling, stolen vehicle tracking and assistance in roadside breakdown situations. This provides drivers with peace of mind during their commute. Technologies like geo-fencing, speed alerts and driver behavior monitoring also improve safety. Rising concerns around security of vehicles and passengers due to increasing road accidents and vehicle theft cases compels more consumers to opt for telematics-enabled vehicles. Stricter safety regulations being introduced by governments across APAC boosts adoption of advanced driver assistance systems that use telematics.
Market Restraint: High technology costs poses challenge for widespread adoption
The components required for sophisticated telematics solutions like sensors, controllers, communication modules and advanced software are expensive. Retrofitting existing vehicles with capable telematics units can significantly increase cost. This makes telematics offerings unaffordable for a mass market consumer segment. Even for new vehicles, automakers need to judiciously plan the price increases of telematics packages to avoid negatively impacting sales. The high costs of developing and maintaining connected vehicle platforms by OEMs can hamper the market growth.
Market Restraint: Lack of standardized telematics platforms hampers cross-brand compatibility
Each automaker develops and uses their own proprietary telematics platforms with different programming interfaces, security protocols, communication standards and data formats. This limits the scope for collaboration and building shared mobility ecosystems. It also creates issues of compatibility, if users want applications and services that can work across different brands. The absence of common connectivity and cybersecurity standards discourages partnerships and prevents harnessing of synergies between automakers, tech companies and telecom operators. Fragmentation poses a challenge for achieving the true potential of connected vehicle technologies.
Market Opportunity: Emergence of new business models centered around data monetization and advanced mobility services
With vehicles generating copious amounts of operational data, there are ample opportunities to leverage this data. Aggregated and anonymized telematics data can provide deep insights into driver behavior, traffic patterns, infrastructure conditions and powertrain performance. This enriched data can be monetized via various analytics services for cities, insurers, road operators and automakers themselves. Mobility players are also piloting innovative shared, on-demand and autonomous mobility services leveraging telematics networks. This expands the revenue potential beyond traditional aftermarket solutions.
Market Opportunity: Growth in usage-based insurance models spurred by telematics data
Insurers have recognized the benefits of using precise driving behavior data from telematics to price policies more accurately according to individual risk profiles. Pay-as-you-drive and usage-based insurance structures reward safer driving with lower premiums. This win-win offering improves transparency and risk assessment for insurers while lowering costs for good drivers. Bundling telematics-based insurance with new vehicles also enhances residual values for automakers. The APAC region is witnessing rising cognizance of these advantages which will support strong expansion of the usage-based insurance segment.
In conclusion, key factors like the development of connected vehicles, increasing road safety awareness, emergence of new digital business models and telematics-enabled insurance solutions can drive the growth of the APAC automotive telematics industry despite challenges around high technology costs and platform fragmentation. Standardization efforts and lowering component rates further aid mainstream adoption across the region.
Link- https://www.coherentmarketinsights.com/market-insight/apac-automotive-telematics-market-3654
Key Developments:
- In October 2022, Asia Mobiliti partnered with Truck It to offer advanced telematics and geomapping technologies. These tools enable advertisers to target their customers more effectively by providing real-time tracking of trucks and routes. Advertisers can also view information about the types of trucks available, thus, helping them tailor their advertising strategies accordingly.
- In October 2022, Borq's Technologies entered the market for two and three-wheeler vehicles by developing a Telematics Control Unit (TCU). Successfully demonstrated in India, this TCU is installed on two-wheelers, thus, enabling it to offer various features such as mobile telephony, data connectivity, vehicle diagnostics, location services, remote vehicle control, battery management, and sensing capabilities.
Key Players:
Trimble Inc., Visteon Corporation, Airbiquity Inc., Aplicom OY, Scorpion Automotive Limited, iTriangle InfoTech Pvt. Ltd., Shenzhen Concox Information & Technology Co. Ltd., Minda Corporation Limited, iDem Telematics GmbH, Road Track, ACTIA Group, Lavinta Buana Sakti, Microlise Limited, BOX Telematics, Redtail Telematics Corporation
