Embedded Telematics Systems Offer Lucrative Options for OEMs in Asia-Pacific Region

The advantage of integrating mobile communications technologies, vehicle monitoring systems and mapping devices in an automobile continues to drive the adoption of telematics in the global automotive landscape. A wide range of connectivity solutions offered through the implementation of telematics extends the functionalities of a vehicle. For OEMs in the automotive industry, telematics is viewed as a new avenue for product development. To accustom the existing automotive parts and components with the functions of telematics systems, OEMs are redesigning and redeveloping their products. Sales of vehicles equipped with telematics continues to soar through the roof, considering the utmost inclination of buyers towards vehicles with high-tech features. Meanwhile, the insurers in automotive industry are expecting telematics to alter their business model by delivering accurate data on accidents and collisions. In addition, the role of telematics systems in investigations and road traffic management is also pegged to drive its significance among automakers.

As advancements in telematics technologies unlock a range of opportunities in terms of data management, customer interaction and vehicle integration, more number of OEMs across the globe are considering implementing them throughout their product line. Automobile manufacturers are exploring options to integrate telematics across their vehicle instrumentation and electronics mechanism. With respect to data procurement, the basic usage of telematics systems can develop comprehensive performance of the vehicle. Total cost management and higher customer interaction is also observed as added advantages of telematics.

Telematics Market: Asia-Pacific to Represent Lucrative Market

The adoption of telematics systems remains predominant in the Asia-Pacific (APAC) region. Countries such as China, South Korea, Japan and India are observed as leading manufacturing hubs in the global automotive landscape. Currently, the global penetration of automotive telematics remains steady at 48%, and is pegged to touch 62% by the end of 2020. According to a forecast study by Future Market Insights, the automotive telematics market in APAC region is poised to be worth US$ 15.4 billion by the end of 2020. More than half of telematics systems adopted in the APAC automotive landscape will be used for safety and security purposes. Increasing vehicle thefts and rising number of advanced security features of vehicles will be driving the end-use of telematics in safety and security applications across the APAC automotive manufacturing environment.

The study reveals that more than 88% of automotive telematics systems will be integrated in passenger cars across the APAC region. Through 2020, China will be at the forefront of expansion for APAC automotive telematics market. Nearly 50% of the overall telematics sales in the region will be accounted by Chinese automakers. The report also reveals that Japan, South Korea and China, together, constituted to nearly 90% of overall market value in APAC automotive telematics marketplace.

Embedded Vehicles to Influence Automakers in APAC Region

A technology based review on the adoption of telematics in APAC region estimated that embedded technology will bring in revenues worth nearly US$ 12 billion. As the usages of telematics technologies in improving the safety of vehicles gains traction, APAC automakers are integrating devices that can provide embedded features to their vehicles. Auto giants such as Ford and General Motors have partnered with Microsoft and other leading tech behemoths to develop embedded vehicles. Asian OEMs are launching embedded telematics systems that can improve the driving experience by transmitting and processing data. In the next five years, all leading automakers in the APAC landscape will have embedded solutions for integrating automotive telematics into their cars.

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Nikhil Kaitwade

With over 8 years of experience in market research and consulting industry, Nikhil has worked on more than 250 research assignments pertaining to chemicals, materials and energy sector. He has worked directly with about 35 reputed companies as lead consultant for plant expansion, product positioning, capacity factor analysis, new market/segment exploration, export market opportunity evaluation and sourcing strategies.