Future Markets for Telematic Components

Report Highlights

• The worldwide market for telematics in 2003 was estimated at $5.6 billion.
• By 2008, revenues are projected to increase at an average annual growth rate (AAGR) of 2.8% to $6.5 billion.
• Revenues from hardware sales for consumer vehicles in 2003 were $3.0 billion. This to decrease at an AAGR of -1.7% to $2.7 billion in 2008. Asteep decline is expected in hardware prices that will limit growth.
• Revenues from consumer monthly fees will rise from $164 million in 2003 to $454 million in 2008, an AAGR of 22.7%.

INTRODUCTION

Transportation is a critical component of the world's economic system. The delivery of goods and materials is essential for commerce. Consumer transportation also is an important market. In recent years, consumer vehicles have been recognized as a platform for consumer electronics and entertainment gear.

Although the amount of electronic technology incorporated into vehicles has risen for years, most are embedded systems that are invisible to the consumer. With telematics, vehicle makers and component suppliers are attempting to make the vehicle cabin (along with the home and office) another venue to be outfitted with electronic gear, bringing additional value-added content to passengers.

Telematics is an emerging market that offers revenue opportunities for companies in the automotive, telecommunications and computer industries. It is a market that requires technology from all three of these industries to function. The current trend is for hardware to be embedded within the vehicle, deployed in the hope that consumers will choose to pay recurring monthly fees for services. Portable systems have yet to represent a major percentage of the telematics market as power issues are limited to current battery technology.

This BCC study reviews and reveals major market trends, and provides a snapshot of present technology along with predictions for the future of global telematics markets and technologies. For purposes of this report, telematics is defined as the technology of pinpointing the location and/or presence of a vehicle. This study analyzes and forecasts the market opportunities for components related to telematics applications for the five-year time span extending from 2003 to 2008.

SCOPE OF STUDY

The report contains:

• An overview of the telematics industry and of the products and technologies used in consumer and commercial vehicles
• Definitions of the technologies involved
• Coverage of the software and hardware used, including tracking, connections, sensors and user interfaces
• Analysis of market segments by product type and application, with forecasts to 2008
• Profiles of leading companies and suppliers.

METHODOLOGY AND INFORMATION SOURCES

Materials and data presented in this report were obtained from telephone interviews with marketing and engineering personnel at the major companies profiled. Research also include information gleaned from catalogs, the Internet, pattern observations, and the literature search of current articles related to optical coatings technology.

ANALYST'S CREDENTIALS

Lori Weisenbach received a Ph.D. in material science and engineering from the University of Arizona in 1993. Her dissertation was based on the fabrication and characteristics of sol gel optical waveguides. She then worked for two years at Sandia National Labs on the development of thin-film zeolite filters for gas-separation applications. From 1996 to 2003, Weisenbach covered the transportation market as both a contributing editor and editor of Advanced Transportation Technology News. She has authored several opportunity reports in advanced materials and transportation for BCC.