Growth Drivers of The Global Automotive Telematics Market

Telematics has transformed into an automotive mainstream. All cars will have some level of embedded telematics, and its benefits for both the manufacturers and consumers is compelling. Automotive telematics can observe and improve driver behaviour and temperament while driving, increase road safety at a real-time basis, boost car- insurance industry profitability and align insurance premiums with actual need.

According to a global automotive telematics market research conducted by Research on Global Markets, the global automotive telematics market is thus expected to expand at a compound annual growth rate (CAGR) of 28.5% during the 2017-2022 periods, to reach approximately USD 198.7 Bn by 2022. Telematics can bring additional benefits to individuals, corporations, and governments beyond insurance and road-safety improvements for example real time tracking, stolen vehicle recovery, vehicle finder services, fuel and routing optimization. Most users cite antitheft, lower insurance premiums, and improved driving behaviour as key benefits of telematics today. 

Today, users have several options in telematics to install in their vehicles. They range from professionally installed services to do it yourself add on devices. Automobile manufacturers may offer built-in telematics devices and customized services to differentiate their offerings from other manufacturers.

Some key types of telematics devices are: 

• Smart phone app: Typically capable of autonomously detecting trips, these apps offer trip scoring based on driving behavior, habits, and the driving context, although the quality of the data collected may not be the best. They are used together with hardware solutions to provide services such as driving tips, reporting, warning, and gamification. Smartphone apps do not work well when it comes to e- assistance services or serving as usage based insurance devices. They however shine when it comes to end user ease of setup and usability in hot conditions. 
• Smart tag: the tag is stuck on the dashboard via adhesives and collects and transfers data using a built in SIM card. Users can equip it with solar investing capabilities and GNSS. Tags are average in road safety considerations and lack robust tamper-resistance safeguards but do better on usability in hot conditions, end user ease of assistance, and e-assistance.
• Cigarette lighter plug-This device plugs into the vehicle’s cigarette-lighter slot to collect and transmit data via a built-in subscriber-identity-module (SIM) card. Lighters are easy to install, compact, and have power backups. These devices receive average marks for driving scores and usage-based-insurance services but score well in ease of setup, usability in hot conditions, road safety, and e-assistance services.

To ensure interoperability across the many platforms and telematics devices that currently or will soon offer telematics access, stakeholders such as manufacturers, insurers and technology and services providers need to establish and adhere to standards. Electronic systems should meet backup-battery performance requirements as well as power-management and protection standards.