Vehicle Tracking Systems Market Size, Share & Trends Analysis Report By Vehicle Type, By End Use (Transportation & Logistics, Retail), By Technology Type, By Type, By Component, By Region, And Segment Forecasts, 2021 - 2028

Report Overview

The global vehicle tracking systems market size was valued at USD 17.64 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 13.3% from 2021 to 2028. The vehicle tracking system is also known as GPS tracking. The need for achieving improved operational efficiency, productivity, and profitability at reduced costs coupled with the digitalization of vehicles is anticipated to act as a key driving factor for the market growth. These systems include features such as predictive fleet maintenance, telematics asset tracking, and fleet route planning. These features facilitate optimum utilization of resources and flexibility in operations. Additionally, factors such as increased cost savings and enhanced customer experience are further contributing to the market demand.

The market has witnessed significant developments in the past few years due to increased digitalization and technological advancement, enabling easy tracking of vehicle performance. The application of automation, telematics, and IoT in these systems has enabled fleet operators to achieve higher operational efficiency. The systems ensure vehicle security and safety while tracking vehicle usage data. Cost aids due to enhanced vehicle performance and innovative features such as fleet analytics, fuel management, driver monitoring, and predictive vehicle maintenance are other key factors anticipated to drive the market growth over the forecast period.

Moreover, the increasing fleet size of the transportation and logistics companies has made fleet tracking necessary for vehicle security and timely delivery. The rapid increase in commercial vehicle sales is expected to drive the demand for fleet tracking and maintenance operations. For instance, according to Organisation Internationale des Constructeurs d'Automobiles (OICA), Germany witnessed a significant increase in commercial vehicle sales from 386,282 units in 2018 to 409,801 units in 2019. Similarly, Canada also witnessed commercial vehicle sales of 1,479.2 million units in 2019 compared to 1,407.2 million units in 2018. The year-on-year growth in commercial vehicle sales shows the increasing operational fleet size of logistics and transportation companies. The increase in fleet operations, especially in developing markets, is anticipated to boost the market growth.

The COVID-19 pandemic has negatively impacted the demand for vehicle tracking systems in 2020. The overall automotive production volumes have declined globally on a year-on-year basis, mainly due to the decreased production volumes in North America and Europe, among other regions. Slowdown faced in some of the leading end-use industries, such as transportation & logistics, retail, and construction and manufacturing, has particularly translated into a dwindling demand for vehicle tracking systems.

Vehicle Type Insights

The passenger vehicles segment accounted for the dominant share of over 41.0% in 2020. The segment is estimated to expand at the highest CAGR from 2021 to 2028 owing to the rising number of fleet operators across the developed and emerging economies. Besides, passenger vehicles are also popular among small and medium-sized businesses. They usually serve the purpose of the pool vehicles or minivans to finish the daily jobs of businesses. This has resulted in increased demand for vehicle tracking systems in passenger vehicles. Moreover, the growing inclination of fleet operators to offer enhanced user experience is anticipated to lead to segment growth over the forecast period.

The light commercial vehicles segment is projected to expand at the second-highest CAGR of 11.8% from 2021 to 2028. The growth can be attributed to the increasing demand for light commercial vehicles across the logistics and transportation sectors. Moreover, the rising penetration of the e-commerce industry is also expected to surge the demand for vehicle tracking systems in light commercial vehicles. Light commercial vehicles such as pickup trucks and minivans are generally used in trade & courier services, plumbing and HVAC services, and delivery services. Companies offering these services can send the best route to the delivery team, provide invoices, and monitor proof of delivery with vehicle tracking systems.

End-use Insights

The transportation and logistics segment accounted for a dominant share of over 26% in 2020 and is anticipated to continue its dominance over the forecast period. The segment is estimated to expand at the highest CAGR from 2021 to 2028 due to the rising GPS tracking usage in the transportation and logistics industry. Besides, vehicle tracking systems ensure real-time location monitoring, the safety of both vehicle and driver, and reduced fuel consumption and administrative costs, all of which have positively impacted the growth of the vehicle tracking systems market. Moreover, several companies are inclined to use the system due to the emergence of connected vehicles.

The retail segment is projected to expand at the second-highest CAGR of 13.5% over the forecast period. With the rise of e-commerce, small and medium-sized retailers have started their delivery services. Vehicle tracking systems enable retailers to save costs and maximize productivity by keeping track of vehicles in real-time and completing deliveries on time. The construction and manufacturing segment is anticipated to record a significant CAGR from 2021 to 2028. This is attributed to several factors, such as monitoring engine runtime, preventing vehicle misuse, monitoring PTO events, locating stolen equipment, saving on insurance, and accurate budgets, among others.  

Technology Type Insights

The GPS/satellite segment emerged as the largest segment in 2020 and is anticipated to maintain its dominance over the forecast period. The segment is estimated to expand at the highest CAGR from 2021 to 2028 owing to several factors, such as GPS capability to work with various technologies like GSM, LTE, and WiMAX coupled with the ability of GPS to be publicized with several satellites. Though it is costly compared to GPRS, its ability to chart more efficient routes and provide better productivity has positively impacted the segment growth.

The dual-mode segment is projected to expand at the second-highest CAGR of 12.1% over the forecast period owing to the presence of several companies that offer both GPS and GPRS-based vehicle tracking systems. For instance, CalAmp is engaged in offering both GPS-based and GPRS-based devices. The dual-mode devices are cheap, easy to install, and are a reliable link between the tracking devices and application servers.

Type Insights

The active segment captured a dominant revenue share of over 83% in 2020 and is estimated to continue its dominance over the forecast period. The segment is projected to expand at the highest CAGR from 2021 to 2028 due to its ability to track real-time data via both cellular networks and satellite. Though active vehicle tracking systems are complex, they offer significant advantages such as versatile networks, labor law compliance, and accurate delivery time information.

The passive segment is estimated to record a substantial growth rate from 2021 to 2028. Passive vehicle tracking systems collect vehicle data and store it on a hard drive or memory card. This data is later accessed when connected to a tablet or computer. Such systems cannot provide real-time locations, which is not suitable during emergencies such as road accidents or theft. However, factors such as simple functionality and no monthly subscription are expected to contribute to the segment growth.

Component Insights

The software segment accounted for the largest revenue share of over 66% in 2020 and is estimated to continue its dominance over the forecast period. The segment is projected to expand at the highest CAGR from 2021 to 2028 owing to the rising number of companies providing software-based vehicle tracking systems. The software segment comprises performance, management, vehicle diagnostics, fleet analytics and reporting, driver behavior monitoring, and other software. Rising inclination and requirement primarily for driver behavior monitoring, fleet analytics, and reporting, and vehicle diagnostics are expected to lead to the segment growth.

The hardware segment is expected to register a CAGR of 11.9% over the forecast period. The segment comprises Onboard Diagnostic (OBD) device/tracker and advance tracker and standalone tracker. The OBD device/tracker and advance tracker subsegment accounted for a dominant share in 2020 and is anticipated to expand at a steady CAGR from 2021 to 2028. Built-in Bluetooth, lower power sleep modes, enhanced GPS and cellular performance, intelligent buzzer support, and power management are some of the factors that are anticipated to propel the segment growth.

Regional Insights

North America accounted for the largest revenue share of over 30% in 2020 and is estimated to register a steady growth rate over the forecast period. The growing concerns of vehicle emission, security, and safety have strongly influenced the transportation industry. Governments across the developed nations have acknowledged these concerns and subsequently introduced stringent norms and developed safety programs. For instance, the U.S. government developed a ‘National Safety Program’ for its General Services Administration (GSA) fleet. Besides, increasing development in Intelligent Transportation Systems has promoted the widespread adoption of smart technologies in fleet management. 

The Asia Pacific vehicle tracking system market is projected to expand at the highest CAGR of 18.0% over the forecast period. The rapid expansion of the e-commerce sector, rising advancements in networking technologies, strict regulatory mandates, and increasing commercial and passenger vehicle sales are some of the key factors driving the regional market growth. Besides, the growing adoption of advanced technologies such as autonomous vehicles, IoT, and cloud in the region is further anticipated to bolster the market growth.

Key Companies & Market Share Insights

Some of the key market players are TomTom International B.V.; Verizon; Geotab Inc.; ORBCOMM Inc.; and CalAmp. The companies in the market are highly focused on product launches to expand their product offerings and meet consumer demands. For instance, in January 2021, Geotab Inc. announced the launch of its new GO9+ telematics solution, which now offers Wi-Fi connectivity. The GO9+ allows businesses to get insights into their vehicles in real-time and use Wi-Fi connectivity with the ignition off for up to four hours. In September 2020, TomTom International B.V. announced the launch of the TomTom Go navigation app on major app platforms. TomTom Go navigation comes with 3D maps and provides a better driving experience even without a mobile network.

The market players are also focusing on strategic expansion to expand their presence in the untapped market. For instance, in January 2021, Geotab Inc. announced its expansion into Southeast Asia by opening an office in Singapore. The development is expected to help the company to expand its presence in the region and drive the adoption of its connected vehicle solutions. Some prominent players operating in the global vehicle tracking systems market are:

• Verizon

• Geotab Inc.

• Cartrack

• TomTom International B.V.

• CalAmp

• Teltonika

• ORBCOMM Inc.

• Xirgo Technologies, LLC

• Laipac Technology Inc.

• Trackimo Inc.

Vehicle Tracking Systems Market Report Scope

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2028. For this study, Grand View Research has segmented the global vehicle tracking systems market report by vehicle type, end use, technology type, type, component, and region:

• Vehicle Type Outlook (Revenue, USD Million, 2016 - 2028)

  • Passenger Vehicles

  • Light Commercial Vehicles

  • Heavy Commercial Vehicles

• End-use Outlook (Revenue, USD Million, 2016 - 2028)

  • Transportation & Logistics

  • Construction & Manufacturing

  • Aviation

  • Retail

  • Government & Defense

  • Others

• Technology Type Outlook (Revenue, USD Million, 2016 - 2028)

  • GPS/Satellite

  • GPRS/Cellular Networks

  • Dual Mode

• Type Outlook (Revenue, USD Million, 2016 - 2028)

  • Active

  • Passive

• Component Outlook (Revenue, USD Million, 2016 - 2028)

  • Hardware

    • OBD Device/tracker & advance tracker

    • Standalone Tracker

  • Software

    • Performance Measurement

    • Vehicle Diagnostics

    • Fleet Analytics and Reporting

    • Driver Behavior Monitoring

    • Others

• Regional Outlook (Revenue, USD Million, 2016 - 2028)

  • North America

    • U.S.

    • Canada

  • Europe

    • U.K.

    • Germany

    • France

    • Rest of Europe

  • Asia Pacific

    • China

    • India

    • Japan

    • Rest of Asia Pacific

  • Latin America

    • Brazil

    • Mexico

    • Rest of Latin America

  • Middle East & Africa (MEA)