Global ITS market exceeded USD 16 billion in 2013 and is anticipated to witness substantial growth over the forecast period. Escalating focus on road safety and rising need for improving the performance of existing transportation networks is also expected to drive demand.
High traffic congestion due to rising number of vehicles has contributed to the need for advanced public traffic management systems. Subsequent need for smart vehicles with public private partnerships is foreseen to be a major growth opportunity during the forecast period. Numerous initiatives undertaken to deploy advanced traffic management systems such as vehicle to vehicle (V2V) and vehicle to infrastructure (V2I) communication is also projected to be observed as a key growth strategies.
Developed regions such as Europe and North America have mandated the use of electronic stability control (ESC) systems, a driver assistance system, in passenger and commercial vehicles. Car manufacturers in both established and emerging regions are installing these systems in their new car models to differentiate their products from the competitors. The aforementioned factors are anticipated to offer lucrative growth opportunities for growth by 2020.
Intelligent transportation systems help improve the supply chain process performance and yield high benefit to cost ratio. Users can also cut down on costs through real-time transportation systems. On account of these factors, transportation service providers have increased investment in this technology over the past few years. However, high installation cost and slow growth in infrastructure sector can act as a challenge to growth.
High benefit to cost ratio strongly influences the transportation authorities and vehicle owners to invest across this technology. Key applications of connected vehicle technologies include Vehicle to Vehicle (V2V) communication, vehicle to Infrastructure (V2I) communication, environment application and mobility application.
U.S ITS market by product, 2012-2020, (USD Million)
The industry can be segmented on the basis of products into cooperative vehicle systems, Advanced Public Transportation Systems (APTS), Advanced Transportation Management Systems (ATMS), Advanced Traveler Information Systems (ATIS), and Advanced Transportation Pricing Systems (ATPS).
ATMS market accounted for over 38% of the global revenue in 2013 and is estimated to grow at a CAGR of over 12% from 2014 to 2020. It aid in alleviating pollution & traffic congestion and also optimizes the transportation network operations. ATMS solutions provided by vendors combine data processing technology along with sensors and communication to ensure real-time management of transportation networks operations.
APTS is expected to grow at a CAGR of over 13.0% by 2020. These systems are used for increasing the efficiency public transit systems’ operations and boost overall safety. Its applications include bus arrival notification systems, real-time passenger information systems, and automatic vehicle location systems.
The intelligent transportation system industry can be classified on the basis of application into traffic management, environment protection, freight management, public transport, road safety and security, automotive telematics, road user charging and parking management.
Traffic management accounted for over 30% of the overall revenue in 2013 and is estimated to grow at a CAGR of over 11.0% from 2014 to 2020. ATMS is used to enhance road networks by reducing the financial burden on regulatory authorities as it decreases investment required to enforce traffic congestion control.
Environmental protection application is expected to witness significant demand, growing at a CAGR of over 17.0% from 2014 to 2020. Varied countries across the globe working to curb vehicle emissions are projected to drive demand across this application.
North America ITS market accounted for over 43% of the overall revenue in 2013 and is estimated to be the dominating region over the forecast period. Increasing demand across private and public sector, government initiatives combined with promotional activities especially across the U.S. is estimated to impel regional growth over the next six years.
Asia Pacific intelligent transportation system industry is anticipated to witness considerate demand, growing at a CAGR of over 13.0% from 2014 to 2020. Growing demand for sensors that can be integrated into handheld devices has spurred development activities. In addition, government legislations including the Industrial Safety, Wealth and Welfare Act are expected to fuel regional growth. Regulatory initiatives and R&D activities in countries such as India and Japan are also estimated to drive demand.
Competitive Market Share Insights
Companies dominating ITS market share include Garmin International Inc, Thales Group, TomTom International BV, Q-Free ASA, Kapsch TrafficCom AG and Nuance Communication Inc.
Key company strategies followed by vendors include product development and innovation combined with mergers and acquisitions. Additionally, vendors provide construction and maintenance services for large deployments of the technology. For instance, in March 2013, Hitachi Ltd introduced a tiny self driving car i.e. ROPITS (Robot for Personal Intelligent Transportation System). It uses gyro sensors and GPS system to direct vehicles through table computers to offer pick and drop facilities for growing number of elderly citizens and for physically disabled population.