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Report overview
In this report, the global Vehicle Tracking System market is valued at USD 17.37 million in 2021 and is projected to reach USD 109.95 million by the end of 2029, growing at a CAGR of 19.7% during the period 2023 to 2029.
The spread of the COVID-19 pandemic has negatively impacted the global vehicle tracking system market, owing to commute restrictions and expected weak financial performance of the market players in 2020. The economic impact of the pandemic is visible with organizations preparing strategic cost-saving plans. Organizations with vehicle assets are considering sale and leaseback options to improve cash flow.
The major risk factors of the vehicle tracking system participants are supply chain execution, regulatory & policy changes, dependency on labor, working capital management, and liquidity & solvency management. Although, FMCG, retail, agriculture pharmaceuticals, and other essential services provider are not being able to dispatch the stored products owing to the fewer number of transporters. To manage and cater to the continuous supply of essentials, the demand for vehicle tracking hardware and managing software increased.
Vehicle tracking system is a system that used global positioning system (GPS) or cellular network to track and monitor the activity of vehicle. It includes vehicle tracking & monitoring remotely, vehicle maintenance, vehicle diagnostics, fuel management, route optimization, driver management and safety management. The vehicle tracking systems work in a loop of GPS, GSM/GPRS, digital maps, and special software.
A tracking module equipped in the vehicle continuously picks up the GPS coordinates that indicate the real-time location of the vehicle. Using a cellular data service, the coordinates are immediately transmitted to the user’s computers. Customers log in to the software to see their vehicles on road maps, similar to in-dash and handheld GPS-based navigation systems. There are non-real-time tracking systems in which the in-vehicle module records the coordinates, but does not relay them for real-time monitoring. The data are downloaded from the module when the vehicle is returned at the end of the trip.
The key factor that drives the growth of the global vehicle tracking systems market includes integration of real-time monitoring and fuel management in vehicles and safety & security concern within transportation services.
Moreover, increase in fleet operations especially in emerging markets is expected to boost the revenue growth of the market during the forecast period. However, price concerns of fleet owners, data privacy infringement along with the cyber security threats and atmospheric inference concern is expected to hinder the market growth. Conversely, rise in adoption of intelligent transport systems, emergence of 5G into vehicle connectivity and growing adoption of mobility-as-a-service (MaaS) are anticipated to provide lucrative growth opportunities for the growth of the market.
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Integration of real-time monitoring and fuel management in vehicles
Vehicle owner and fleet operators can track their vehicles in real-time and check if drivers are following the suggested path or if there are diversions. For such fleet management, cloud-based solutions, such as AI, IoT, and big data, are used to collect primary data. For instance, Techwave Consulting Inc. uses sensors that can be embedded in vehicles to monitor high-value goods as they connect to the cloud and transmit the data in real-time. Furthermore, activities that are crucial in vehicle tracking system include vehicle & driver tracking, asset management, two-way communication, driver safety & time management, rescheduling the delivery task, and others. Moreover, introduction of innovative products and advantages of using vehicle tracking system, such as quick access & response, wide-area coverage, and cost reduction, helps vendors to increase their productivity and efficiency, thereby escalating the demand for vehicle tracking system. Moreover, many vehicle owners and fleet operators are facing an issue to measure accurate consumption of fuel required for vehicles, owing to lack of technical know-how about fuel monitoring tools. Therefore, by leveraging the Internet of Things (IoT), fuel can be controlled. Specially designed sensors are embedded in the fuel tanks that send notifications to the user’s mobile handsets and computers about the fuel level in vehicles through the public cloud. Furthermore, vehicle tracking system helps vehicle management by identifying the driver behavior with the help of sensors embedded in the vehicle. This includes the number of hours that the driver is driving, harsh braking, slow & speed driving, consistency in the speed limit, frequent halts, and harsh acceleration. Thus, the integration of real-time monitoring and fuel management in vehicles drives the market growth.
The demand for vehicle tracking system has increased to make sure vehicle safety and eliminate idle time with increased use of internet and technological developments in connectivity. Directives such as e-call services have aided the fleet owners to obtain emergency alerts. Fleet operators and logistics businesses can capitalize on the vehicle tracking technology as one of the main drivers of profitability.
For instance, China, Japan, and South Korea are leading Asia's electric/hybrid trend. These steps are taken to increase the number of fleet cars on road. Accordingly, fleet operations are anticipated to grow at a faster rate in emerging regions such as Asia-Pacific and Latin America.
Data related to vehicle contain sensitive information, such as the vehicle make, drivers’ personal details, and routes traversed. The data can be exploited for carrying out malicious or criminal activities, including vehicle robberies and planned crime. Data privacy infringement is a major reason discouraging end customers from using vehicle tracking system, especially in North American countries and China, where regulations are stringent. Moreover, events, such as unauthorized access to multiple vehicle connectivity solutions or breaking into the in-vehicle connectivity system. The major security concern is that the hacker has access to the computer system of the vehicles as well as to the data that it collects and stores. Therefore, data privacy infringement along with the cyber security threats of vehicle tracking system is expected to hamper the growth of the market.
Various companies and government authorities across the world have come up with a mobility-as-a-service model to reduce traffic and carbon emissions. They are introducing ride-hailing, carpooling, car sharing, and more options for commuters instead of using their private vehicle. Vehicle tracking system provider companies are likely to benefit from this service. The hardware device and software is expected to assist in gaining insights regarding pick-ups, drop-offs, and vehicle telematics, and payment activities. For instance, in August 2020, Zoomcar introduced 'Zoomcar Mobility Stack' (ZMS), a software stack, for corporates and fleet owners to keep track of vehicle status and drivers’ behavior in real-time to prevent rash driving and control vehicular damage. Moreover, the mobility service providers such as Lyft, Uber, Ola, DiDi and others announce their plans to introduce autonomous vehicles and robo-taxies in their fleets. Therefore, surge in adoption of Mobility-as-a-service (MaaS) offers different opportunities for market expansion.
The spread of the COVID-19 pandemic has negatively impacted the global vehicle tracking system market, owing to commute restrictions and expected weak financial performance of the market players in 2020. The economic impact of the pandemic is visible with organizations preparing strategic cost-saving plans. Organizations with vehicle assets are considering sale and leaseback options to improve cash flow. The major risk factors of the vehicle tracking system participants are supply chain execution, regulatory & policy changes, dependency on labor, working capital management, and liquidity & solvency management. Although, FMCG, retail, agriculture pharmaceuticals, and other essential services provider are not being able to dispatch the stored products owing to the fewer number of transporters. To manage and cater to the continuous supply of essentials, the demand for vehicle tracking hardware and managing software increased.
Key Benefits For Stakeholders
