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Commercial Vehicle Telematics in India - Market Drivers and Forecast from Technavio
[October 24, 2016]

Commercial Vehicle Telematics in India - Market Drivers and Forecast from Technavio


Technavio analysts forecast the commercial vehicle telematics market in India to grow at a CAGR of close to 16% during the forecast period, according to their latest report.

The research study covers the present scenario and growth prospects of the commercial vehicle telematics market in India for 2016-2020. Based on the solution type, the market in India is divided into three segments: entry level, mid-tier, and high end.

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Technavio analysts highlight the following three factors that are contributing to the growth of the commercial vehicle telematics market in India:

  • Collaboration of OEMs with telematics manufacturers to provide in-built telematics systems
  • Increased demand for vehicle tracking and monitoring systems in the logistics sector
  • Progressive business environment and increased infrastructure spending by the government

Collaboration of OEMs with telematics manufacturers to provide in-built telematics systems

The telematics market in India is fragmented and is served by many players owing to low technology acceptance and price sensitivity of the consumers. The aftermarket players dominate the market. Recently, OEMs have changed the market dynamics by providing embedded telematics services to customers. "The telematics industry has seen a lot of collaboration and memorandums of understanding between OEMs and telematics service providers in recent years," says Siddharth Jaiswal, a lead automotive electronics research analyst at Technavio.



TATA is the first OEM to provide telematics services through TRACKIT, a vehicle tracking device equipped in the TATA Novus series to facilitate truck drivers and fleet owners.

Increased demand for vehicle tracking and monitoring systems in the logistics sector


"Telematics usage in the Indian market is limited to basic services, like tracking and fleet management services. Although the telematics market in India is still in the nascent stage, experts still forecast a strong growth rate due to the increased demand for fleet management and other basic telematics services," says Siddharth.

Demand for telematics in the Indian market is driven by the need to reduce fuel expenses as it accounts for 30% of the total acquisition cost of a commercial vehicle. It is estimated that, on average, the number of empty runs accounted for 24% of the total runs made by fleets in India. Fleet management services reduce the number of empty runs by fleets, thereby reducing overall fuel costs. In India, only 33% of a vehicle's lifetime is used for delivery. As a result, the fleet management system is used by many fleet operators to reduce overall vehicle downtime. Apart from fuel savings and reduced vehicle downtime, it also provides fleet monitoring services like geo-fencing to the fleet operators, which helps in reducing unauthorized vehicle activities.

Progressive business environment and increased infrastructure spending by the government

The commercial vehicle telematics market in the developed economies of North America and Europe has already reached its full potential. However, telematics systems are slowly being absorbed in developing nations like India, especially in the unorganized logistics sector. However, increased spending from the government has attracted many global players to the sub-continent.

The government has planned to invest more than USD 1 trillion in infrastructure over the next five years. The National Highway Authority of India (NHAI) has also planned to construct 15,000 km of highways by 2017. The government has decided to install tracking and fleet management services in 400,000 new buses by 2017.

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About Technavio

Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.

Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.

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