FLAME 2020
Telematic Components: Technologies and Global Markets
Report Highlights
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In 2010, BCC projects that total global market value of telematics components will increase to $12.9 billion. In 2011, global net market value will increase to $15.6 billion. Given a compound annual growth rate (CAGR) of nearly 21%, net market value will increase to $40.3 billion by 2016.
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The hardware and services segments will each grow at a 31.7% compound annual growth rate (CAGR). Services have a greater market value, worth an estimated $5 billion in 2011 and nearly $20 billion in 2016.
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Beginning in 2010, government mandates in Europe and Brazil will begin to drive the hardware market, as regulators will require that vehicles be equipped to contact emergency services in the event of an incident. This sector will be worth $2.6 billion in 2011 and is expected to reach $10.3 billion by 2016.
INTRODUCTION
STUDY GOALS AND OBJECTIVES
This report analyzes and forecasts the market opportunities for components related to telematics applications for the time span extending from 2010 to 2016. Although it is difficult to separate revenues derived from content delivered via telematics hardware or components from the overall potential of the market, revenues that are related to content services will only be considered to the extent that they drive the sales of components.
BCC notes that much of the content developed for telematics hardware can also be offered to users of cellular telephones and other wireless devices. For the purposes of this report, BCC will adopt a definition of telematics that requires knowledge of the location and presence of a vehicle.
REASONS FOR DOING THE STUDY
Telematics, as an industry, is no longer in its infancy, yet it has not yet achieved mainstream status, particularly in the consumer market because drivers have not seen the need or benefit of the higher cost. The significant changes occurring in the general automotive industry as well as demographic changes present an opportunity for telematics.
Telematics systems have higher margins than other automotive technologies and so offer the possibility of increasing the margins of smaller cars. Consumers are becoming accustomed to a continuous connection to the Internet; the vehicle cabin represents one of the last significant spaces where this is not yet common. Commercial telematics systems have produced fuel savings and lowered emissions. Designers of electric and other alternatively fueled cars will include telematics systems as a necessity to tell consumer where they can refuel their cars. The world’s aging population may represent an opportunity for telematics technology to the extent that the technology increases safety or prolongs the independence of older drivers.
SCOPE OF REPORT
This report covers telematics products used in vehicles, which can be broadly segregated into hardware and software. Hardware includes tracking, connection, sensors, and user interface. It focuses particularly on the markets and opportunities for telematics in the consumer and commercial vehicle markets. Software includes the embedded operating systems that control the systems; it does not include any content-related packages.
As a complete source for serious players in the emerging telematics marketplace, this study is presented in easy-to-follow sections that overview this subject, define the technology, segment the market by product type and application, profile companies, and identify suppliers.
INTENDED AUDIENCE
Vehicle designers can use this report to assess the status of the telematics market in order to identify suppliers and systems integrators, and thereby forecast future markets. Market managers will be able to assess the competition, and identify customers and new suppliers for components. And management consultants will be able to determine whether companies divest or invest in telematics technology, based in part on the market projections, competitive strengths, and development issues revealed in this report.
Equipment managers will be able to develop or modify existing products to address telematics technology manufacturing concerns emphasized in this report. Market opportunities and new customers for material suppliers will be identified, based on the study’s projected growth in applications. Venture capital managers will be able to identify targets for investment, merger, or acquisition, based on companies identified and described in this report. And strategic planners can identify other, critical asset companies with whom they may partner, and, in turn share in overall fiber-optic technology growth as projected in this report.
INFORMATION SOURCES
Materials and data presented in this report were obtained from telephone interviews. Research also includes information gleaned from catalogs, the Internet, pattern observations, and the literature search of current articles related to optical coatings technology.
ANALYST 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 2 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 business opportunity reports in advanced materials and transportation for BCC.
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DISCLAIMER
The information developed in this report is intended to be as reliable as possible at the time of publication and of a professional nature. This information does not constitute managerial, legal, or accounting advice; nor should it serve as a corporate policy guide, laboratory manual, or an endorsement of any product, as much of the information is speculative in nature. The author assumes no responsibility for any loss or damage that might result from reliance on the reported information or its use.
Report Highlights
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The worldwide market for telematics in 2003 was estimated at $5.6 billion.
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By 2008, revenues are projected to increase at an average annual growth rate (AAGR) of 2.8% to $6.5 billion.
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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.
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Revenues from consumer monthly fees will rise from $164 million in 2003 to $454 million in 2008, an AAGR of 22.7%.