APAC AUTOMOTIVE TELEMATICS MARKET ANALYSIS

Market Size and Trends

APAC automotive telematics market is estimated to be valued at USD 25.07 Bn in 2024 and is expected to reach USD 64.43 Bn by 2031, exhibiting a compound annual growth rate (CAGR) of 14.4% from 2024 to 2031.

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APAC automotive telematics market is witnessing growth due to rising demand for connected vehicles, growing sales of luxury vehicles with advanced technologies, and increasing government initiatives for promoting safe and efficient driving. Major automakers in the region are focusing on development of self-driving and electric vehicles integrated with telematics control units to enhance driver experience. Adoption of autonomous and semi-autonomous driving technologies requires sophisticated telematics solutions for vehicle connectivity and data transfer, and this compels many automakers to partner with telematics solution providers. Increasing collaborations between OEMs and telecom players is also expected to boost deployment of advanced telematics infrastructure in commercial vehicles.

Growing Adoption of Infotainment and Connected Car services

With the rapid adoption of smartphones and growing penetration of internet, consumers in Asia Pacific countries are getting accustomed to connectivity and digital services, and thus, people expect the same level of connectivity and personalization in their vehicles also. This has prompted automakers in the region to increase their focus on developing advanced infotainment systems for vehicles that can enhance the in-vehicle experience of customers. Features like GPS navigation, voice-command controls, advanced entertainment options like music streaming and smartphone mirroring have become standard in most newly vehicles launched.

Automakers are now pushing the envelope further by introducing connected car services that integrate the vehicle with a wider mobility ecosystem. Services like emergency call systems, automatic crash notification, stolen vehicle tracking, remote diagnostics, fleet management solutions and predictive maintenance helps automakers to monitor vehicles round the clock and improve safety, convenience and efficiency. Telematics allow automakers to remotely update vehicle software over-the-air, add new functionalities and fix bugs, similar to smartphones and other smart devices. This helps to improve the overall ownership experience for customers.

Market Concentration and Competitive Landscape

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With countries like China, Japan and South Korea aggressively promoting research and development in autonomous and electric vehicles, the APAC region is at the forefront of next-gen automotive technologies. While full self-driving may be still few years away, semi-autonomous features like adaptive cruise control, lane keep assist, traffic jam assist are being introduced in new premium vehicles. This requires sophisticated telematics hardware and software capable of processing vast amount of real-time sensor data from cameras, radars and lidars. Telematics plays a vital role in delivering advanced driver assist features by tightly integrating vehicle control systems with connectivity modules.

For electric vehicles to gain wider acceptance, automakers need to overcome customer concerns around range, reliability and charging infrastructure. Advanced telematics allows automakers to remotely monitor battery performance, predict charge depletion and locate nearest charging stations. It helps electric vehicle owners efficiently plan their drives. Telematics enables automakers to roll-out over-the-air software upgrades to improve energy efficiency over time without physically recalling vehicles for updates. Growing push towards cleaner emissions will further accelerate R&D in autonomous and electric vehicles, thus, boosting adoption of telematics.

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Market Challenge: High initial costs

Vehicle connectivity and data security standards vary widely across the diverse APAC region, making regional solutions difficult. Lagging telecom infrastructure in rural areas limits the adoption of connected vehicles.

High infrastructure and development costs can restrict the integration of advanced telematics systems into mainstream vehicles. Customer awareness about telematics benefits is still evolving, hampering demand.

Market Opportunities: Emergence of autonomous vehicles

Rising disposable incomes boosts demand for connected vehicle services. Expanding 5G networks and GPS penetration will support new telematics applications. As autonomous driving technologies progress, telematics that provide live traffic, navigation and emergency response capabilities will see increased importance. Automakers view the populous APAC region as essential for scaling new connectivity solutions.

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Insights, By Vehicle Type- Low cost of ownership boosts demand for commercial vehicle

In terms of vehicle type, commercial segment is estimated to contribute the highest share of the market owing 67.6% in 2024 to its lower total cost of ownership compared to passenger vehicles. Commercial fleets focus on maximizing productivity and minimizing downtime, thus, operational efficiency benefits of telematics are highly valued. By tracking driver behavior, location, and vehicle condition remotely, fleet managers can address issues proactively to avoid breakdowns. Telematics also enables fuel management functions that reduce fuel costs, one of the largest variable expenses for commercial fleets. These capabilities have resulted in improved fleet utilization and a quicker return on investment as compared to passenger vehicles applications.

Commercial telematics solutions provide safety features like geofencing that alert managers if vehicles leave designated areas. This helps enforce policies and reduces liability. Emergency assistance functions also give managers peace of mind regarding driver and cargo safety. The integrated management of commercial fleets through a single dashboard has streamlined operations by facilitating tasks like dispatch, maintenance scheduling, and record-keeping. This centralized oversight and control improves fleet productivity and cashflow.

As commercial fleets expand their operations regionally and globally, demand for telematics increases to support management of decentralized assets across borders. Growing e-commerce and logistics sectors increases commercial vehicle traffic, thus, offering new opportunities for telematics adoption. However, hardware costs still present a barrier for small fleet owners. Potential exists for lower-cost solutions tailored for these segments.

Insights, By Technology Type- Embedded systems lead as standard technology

In terms of technology type, embedded segment is estimated to contribute the highest share owing 41.3% in 2024 of the market due to its popularity as the standard telematics solution integrated directly into new vehicles. Unlike tethered devices that are installed externally, embedded systems offer a more seamless in-vehicle experience without needing additional hardware installations. This contributes to higher customer acceptance as a built-in connected car feature.

Vehicle manufacturers prefer embedding telematics functionality for strategic reasons as well. It cements long-term customer relationships through exclusive access to driving behavior data and customized in-vehicle services. This data provides insights into purchase patterns and generates additional revenue streams through value-added services. Embedded systems also enhance a manufacturer's technological image in an increasingly connected mobility landscape.

High upfront costs of developing embedded telematics modules and integrating them across product lineups has limited adoption rates so far to high-end models. As chipset prices decline and functionality standards solidify, embedded solutions will become more affordable and common even in mass market vehicles. Over-the-air update capabilities of embedded systems also provide convenient remote management of functions and services.

Tethered devices still appeal to budget-conscious customers as a low-cost retrofit option. But the market is shifting towards more seamless embedded experiences, resulting in the segment steadily losing share over time.

Insights, By Sales Channel- OEM partnerships drive sales through new vehicles

In terms of sales channel, OEM segment is estimated to contribute the highest share of the market owing 65.4% in 2024 due partnerships between automakers and telematics solution providers. These partnerships see services factory-fitted into new vehicles during the manufacturing process rather than added later through independent aftermarket installations.

For telematics companies, OEM channels grant access to large captive customer bases. These also validate solutions and brands through association with reputable car brands. For automakers, telematics enhance new vehicle values with connectivity features. Exclusive telematics services also boost loyal relationships throughout the ownership lifecycle.

OEMs can strategically bundle service plans into financing agreements, boosting both vehicle and subscription sales. The ability to remotely diagnose issues also benefits automakers looking to improve after-sales support quality. Many now view connectivity as a source of competitive differentiator and lifetime revenue stream.

While the aftermarket segment serves as an important outlet for used vehicle installations and upgrades, the OEM channel enjoys stronger growth momentum. As embedded systems become standard in new models, the OEM segment will account for an even greater portion of telematics sales. However, aftermarket solutions remain crucial for addressing the huge existing fleet without built-in connectivity.

Market Report Scope

Key Developments

• In December 2022, OCTO Telematics opened a new office in Tokyo, Japan, to strengthen its presence in a key area for technology, robotics, and automation. The new Japan branch will support the development of the connected mobility market in Japan and nearby regions by providing technical and sales assistance to partners.
• In November 2022, Minda Corporation, the flagship company of the Spark Minda group, signed a technology license agreement with LocoNav. This agreement allows Minda Corporation to use LocoNav's telematics software under its own brand name. By partnering with LocoNav, Spark Minda aims to offer Original Equipment Manufacturers (OEMs) a complete solution by integrating LocoNav's software with its own telematic devices.

*Definition: APAC Automotive Telematics Market consists of telematics solutions and services that are used in the automotive industry across the Asia Pacific region. It involves the use of wireless technologies like GPS, cellular networks and on-board diagnostics systems to share real-time vehicle and driver information with automakers and auto service providers. Some key features of automotive telematics include vehicle tracking, navigation assistance, emergency calling, driver behavior monitoring and remote diagnostics of the vehicle.

Market Segmentation

• By Vehicle Type
• • Passenger
  • Commercial
• By Technology Type
• • Embedded
  • Tethered
  • Smart Phone
• By Sales Channel
• • OEM
  • Aftermarket
• By Application
• • Infotainment
  • Safety
  • Navigation
  • Diagnostics
• 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