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  4. > Strategic Outlook of Commercial Vehicle Telematics Market in 2015 : Global Telematics Installed Base to Surpass 17.6 Million by 2015

Recap of 2014

Acquisition and partnerships with non telematics vendors aided regional market leaders to bolster and broaden global footprint.

Regulation and Mandates
•Government mandated all trucks to be equipped with tracking devices in China.
•Indian government mandated location-based systems in school buses and vans.
•Brazil’s CONTRAN 245 was scheduled for % implementation at the end of 2014, and it is expected to be completely mandated by December 2015.
•Russia’s ERA GLONASS mandate will be fully operational after January 2015.
•Implementation of Electronic Logging Device (ELD) and eCall were delayed and expected beyond 2016.
•The French government ruled out Eco tax implementation indefinitely citing obstacles (2014).

OEM Solutions
•European Vehicle OEMs such as Scania, Volvo Trucks, and Daimler continued to offer factory fit telematics as a standard across a wide variety of models.
•Vehicle OEMs in emerging markets such as South Africa, India, and China are geared up to offer optional telematics fitment with free services until warranty period.

Geographical Expansion
•TomTom, with the acquisition of Coordina and Fleetlogic, extended its geographical service offerings to regions such as France, Netherlands, and Spain.
•Transics, on a contractual agreement with Almarai, entered the Middle East providing services for more than x fleet vehicles.

Emerging Business Cases
•Customers, to get relief from the primary hurdle of initial installation and hardware cost, gradually moved their preference towards installment-based business models. The transformation was noted in markets such as South Africa, Europe, and North America.

Connectivity
•The evolution of network connectivity from 2G to 3G resulted in service disconnections at certain areas due to compatibility issues. FMS providers addressed this by replacing the old hardware boxes with new 3G compatible models for free of cost for their existing customer-base.

Top 6 Predictions for 2015

Advanced telematics solutions for driver behaviour and prognostics will witness an ascendance of interest after gaining attention in 2014.

Driver Behaviour/ Scoring
More than a feature-level trend, driver behaviour management has become an important area for fleet owners to optimise operating cost by warding-off accident-related expenses. Drivers also get certified based on their style of driving, impacting their scores positively or negatively, helping them obtain a best fit in the fraternity.

OEM Prognostics
Reducing vehicle downtime through vehicle health management and preventive maintenance will be the focus for OEMs and large fleets to mutually benefit upon. Going forward, the service will be fully automated with no human intervention by leveraging on Big Data analytics and predictive modelling.

Video Surveillance
The next big solution is identified as video intelligence which records the driver behaviour using a driver-facing camera and risky road events using a forward-facing camera. This solution gained significance in driver management and coaching, also giving an edge to the fleet operators in optimising and reducing insurance costs.

Factory-fitted OEM Telematics (Standard)
In the past, OEM offerings have not been as successful as third-party offerings as OEMs did not have a distinct database infrastructure and struggled to provide services for mixed fleets. In future, OEMs have seen appreciable increase in the active units as a result of partnerships with aftermarket vendors.

Independent Smartphone
Independent smartphones will grab attention, offering almost all the basic and mid-tier features at a significantly lower cost compared to embedded and portable solutions. Smartphone solutions started to gain shares in the North American and European regions, presenting higher penetration in LCV’s (classes 2 to 3).

Focus on BRIC
Global market leaders such as Omnitracs, Trimble Navigations Ltd., and TomTom Telematics are likely to venture into developing nations – Brazil, Russia, India, and China, where there is potential for telematics. These regions are dominated by low-priced products from domestic vendors which remains a challenge for new entrants.

2014 and 2015—A Strategic Comparison

The year 2015 will witness the commencement of major shift towards business cases, solution types, and market fragmentation

Market status
Globally, CV telematics market was determined to have surpassed x % telematics penetration.
CV telematics market is expected to grow at approximately x % Y-o-Y, fuelled by increase in awareness and benefit realisation.

Competition
Vendors in Europe and North America continued towards consolidation trend, resulting reduction in market fragmentation.
CV telematics market is expected to be dominated by aftermarket, with approximately x % against Vehicle OEMs.

Pricing
CV telematics market witnessed continuous decline in the price of hardware, making it one of the key drivers.
Influx of new business cases are expected to kindle the pricing restructure in hardware and solution offerings by the end of 2015.

Technology
Connectivity migration from 2G to 3G prompted providers to replace with 3G compatible hardware boxes (either by exchanging free of cost or with minimal cost) in Europe and North America.
To tackle the future migration issues, service providers started to cater boxes that are compatible to 3G as well as advanced generation connectivity such as 4G and 4G LTE.

Solutions
Embedded solutions are widely preferred, followed by portable and independent smartphone solutions.
OEMs’ aggressive standardisation of telematics across % of new models are likely to maintain embedded solutions’ complete domination, but ascendance of independent smartphone solution is expected to outpace portable solutions by 2015.

Table Of Contents

Strategic Outlook of Commercial Vehicle Telematics Market in 2015 : Global Telematics Installed Base to Surpass 17.6 Million by 2015
Executive Summary 3
Research Scope and Segmentation 12
Key Market Trends—2015 16
Telematics Product Analysis—2015 21
Regional Market Trends and Analysis—2015 30
Market Measurement Analysis—2015 39
Opportunity Analysis 45
Competitive Analysis—2015 49
Emerging Market Trends 60
Key Conclusions and Future Outlook 67
Appendix 70

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