Vehicle Tracking Systems Market Size, Share & Trends Analysis Report By Vehicle Type, By End-use, By Technology, By Type, By Component, By Region, And Segment Forecasts, 2020 - 2027

Report Overview

The global vehicle tracking systems market size was valued at USD 18.6 billion in 2019 and is expected to grow at a compound annual growth rate (CAGR) of 14.0% from 2020 to 2027. The vehicle tracking system is also known as GPS tracking. The digitalization of vehicles and the expanding global transportation and logistics industry has presented new growth opportunities to the industry participants. The need for reduced cost and improved operational efficiency, to achieve higher profitability and productivity, has been the prominent market driver. Services, such as asset tracking, fleet route planning, telematics, and predictive fleet maintenance, facilitate flexibility in operations and optimum utilization of resources are also anticipated to fuel the product demand. Furthermore, these systems also help increase cost savings and enhance the customer experience. Connected technologies, along with components, such as sensors, cameras, navigation systems, and connected smartphones, are used to gather real-time information.

The gathered data is either processed by the vehicle’s onboard computer or is transmitted to a cloud server for further analysis. This has enabled efficient tracking and monitoring of the vehicle and driver performance. Vehicle tracking systems enable real-time monitoring of driving conditions, such as speed, fuel efficiency, location, idle time, route information, and vehicle diagnostics. The use of a well-defined solution for managing and analyzing such information can help fleet operators in predictive maintenance. Thus, companies adopting connected technologies have additional advantages over their competitors. Such companies are able to achieve higher cost savings and efficiently manage fleet operations.

The market has witnessed significant developments in the past few years. Technological advancements and increased digitalization have enabled easy tracking of vehicle performance. The implementation of IoT, telematics, and automation in these systems has enabled the integration of the logistics chain and thereby, enabled fleet operators to achieve higher operational efficiency. The deployment of the system has helped monitor vehicle usage trends and ensure vehicle safety and security. In addition, cost benefits, owing to improved vehicle performance, and innovative features, such as predictive vehicle maintenance, driver monitoring, fuel management, and fleet analytics, are other key factors expected to drive the market over the forecast period.

Growing concerns related to vehicle security and safety, traffic congestion, and the need for managing fuel costs and adhering to the vehicle emission standards are expected to drive the automotive segment. The vehicle tracking systems help tackle major transportation issues pertaining to congestion, emission, and road safety, which, in turn, will support market growth.

The high adoption of ADAS has enabled the solution providers to address the growing concerns regarding road safety & security, road congestion, fuel efficiency, and increased carbon emissions. ADAS incorporates various connected technologies, such as sensors and LiDAR, in-car networking, and image processors, which assist drivers by providing critical information like collision alerts and potential problems, assisted cruise control, and assisted parking. The adoption of such safety features is mandatory for all commercial and passenger vehicles.

Technological proliferation and improved connectivity services have resulted in increased adoption of smart/connected technologies of the vehicle tracking systems. The sensor nodes embedded in a vehicle are used to transmit real-time data and collect a variety of information on vehicle speed, location, fuel consumption, distance traveled, and air pressure. This data is further used by the fleet owners to make prompt business decisions and drive operational efficiencies.

Vehicle Type Insights

Passenger vehicles held the largest market share of 39.9% in 2019 and will expand further at the fastest CAGR from 2020 to 2027. This is attributed to the rising number of fleet operators in several developing regions. In addition, the rising inclination of fleet operators to provide enhanced user experience at varied price points is anticipated to boost the market growth in the passenger vehicles segment. Furthermore, passenger vehicles are also popular among medium- and small-size businesses since they usually serve the purpose of minivans or pool vehicles to complete everyday jobs of businesses, thereby resulting in the increased demand for a vehicle tracking system in passenger vehicles.

The light commercial vehicles segment is estimated to grow at a CAGR of over 12% from 2020 to 2027. Light commercial vehicles, such as minivans or pickup trucks, are used in delivery services, HVAC and plumbing services, and trade and courier services. Companies providing these services can monitor proof of delivery, provide invoices, and send the best route to the delivery team or person, among others. Additionally, the rising penetration of the e-commerce industry is also anticipated to drive the usage of vehicle tracking systems in light commercial vehicles.

End-use Insights

The transportation & logistics segment held the largest market share of over 25% in 2019 and will expand at the fastest CAGR from 2020 to 2027. This is attributed to the rising usage of Global Positioning Systems (GPS) tracking in the transportation & logistics industry. Several companies are inclined towards the usage of the system owing to the emergence of connected vehicles. Furthermore, the fact that vehicle tracking systems ensure reduced administrative and fuel consumption costs, the safety of both driver & vehicle, and real-time location monitoring has positively impacted the vehicle tracking system market growth. The construction & manufacturing segment is estimated to expand at a steady CAGR from 2020 to 2027.

This is attributed to several factors, such as accurate budgets, monitoring engine runtime, locating stolen equipment, field service management, saving on insurance, monitor PTO events, and prevent vehicle misuse, among others. Furthermore, the aviation segment is anticipated to witness significant growth over the forecast period. GPS tracking in aircraft ensures location tracking in case of an accident or any casualty. For instance, according to the Federal Aviation Administration of the U.S. Department of Transportation, all aircraft are supposed to be integrated with air traffic controllers, which will ensure efficient tracking of aircraft and will also provide more insights to the pilots in the cockpit. This upgrade in technology and infrastructure is expected to be a step closer to the next-generation air transportation system.

Technology Insights

The GPS segment held the largest market share of over 47% in 2019. This is attributed to several factors, such as it can be publicized with several satellites and its ability to work with various technologies like WiMAX, LTE, and GSM. Furthermore, even though it is costly as compared to General Packet Radio Service (GPRS). Its ability to provide better productivity and chart more efficient routes has positively impacted the segment growth.

The dual-mode segment is estimated to grow at a significant rate from 2020 to 2027. This is attributed to the presence of several companies that offer both GPRS- and GPS-based vehicle tracking systems. For instance, Calamp Corp. is engaged in offering both Cellular and GPS-based devices. The dual-mode devices are easy to install, cheap in price, and are the reliable links between the application servers and tracking devices.

Type Insights

The active segment held the largest market share of more than 82% in 2019. This is attributed to its ability to track real-time data via both satellite and cellular networks. Furthermore, even though the system is complex in nature it offers enhanced benefits as compared to its counterpart.

The passive segment is estimated to register a steady CAGR from 2020 to 2027. Passive vehicle tracking systems collect vehicle data and store it on a memory card or on a hard drive. This data is later accessed when connected to a computer or tablet. Such systems lack providing real-time location, which is not suitable during emergency situations, such as theft or road accidents. However, several factors, such as no need for a monthly subscription and simple functionality, are anticipated to drive the segment growth.

Component Insights

The software segment held the highest share of 65.8% in 2019 and will register the fastest CAGR from 2020 to 2027. This is due to the rising number of companies offering software-based systems for vehicle tracking, wherein the system can be directly installed on the user’s machine thereby eliminating the need for hardware. Furthermore, the fact that the software provides several benefits, such as driver behavior monitoring, fleet analytics, and reporting, vehicle diagnostics, and performance measurement, will support segment growth. Rising consumer inclination and requirement primarily for vehicle diagnostics, fleet analytics, and reporting, and driver behavior monitoring is anticipated to drive the segment growth.

The driver behavior monitoring sub-segment is expected to register a CAGR of over 12% from 2020 to 2027. The rising importance of driver and vehicle safety is anticipated to boost the market growth. In addition, it also ensures providing alerts if in case driver violates safety practices, performs fast cornering, hard braking, and sudden acceleration. The Onboard Diagnostic (OBD)/advance tracker is anticipated to grow at a steady CAGR over the forecast years. Power management, lower power sleep modes, built-in Bluetooth, enhanced GPS, and cellular performance, intelligent buzzer support, among others are some of the additional factors that are anticipated to bolster the market growth.

Regional Insights

North America held the largest market share of 31.87% in 2019 and will register steady growth over the forecast period. The growing concerns of vehicle safety, security, and emission have strongly influenced the transportation industry. Governments of various developed nations have acknowledged these concerns and subsequently developed safety programs and introduced stringent norms. For instance, the U.S. government developed a ‘National Safety Program’ for its General Services Administration (GSA) fleet. Additionally, in 2015, it announced a tactical plan to develop Intelligent Transportation Systems (ITS) over a period of five years. Such active initiatives promoted the widespread adoption of smart technologies in the field of fleet management.

The Asia Pacific region is expected to witness the fastest CAGR of 19% from 2020 to 2027. The rising advancements in networking technologies, rapid expansion of the e-commerce sector, increasing vehicle sales, and strict regulatory mandates are some of the key factors driving the regional market. The growing adoption of advanced technologies, such as cloud, IoT, autonomous vehicles, and mobility solutions, in the region, is further expected to boost market development.

Key Companies & Market Share Insights

The market is fragmented and characterized by intense competitive rivalry as there are several market players conducting their business operations worldwide. The market has witnessed various inorganic growth strategies, such as acquisitions & mergers, partnerships, and collaboration, adopted by companies over the recent past. For instance, in June 2017, Orbcomm, Inc. acquired Inthinc Technology Solutions, a provider of driver safety and fleet management solutions, to enhance its product portfolio.

Market players are also focusing on expanding their business by launching various partnership programs across different regions. In April 2017, Sierra Wireless announced the acquisition of the assets of Global Top Technology’s Global Navigation Satellite System (GNSS) to strengthen its product portfolio and gain a competitive edge, owing to the Global Top Technology’s established sales network. Some of the prominent players in the vehicle tracking systems market include:

• Verizon Communications, Inc.

• Sierra Wireless, Inc.

• TomTom International B.V.

• Geotab Inc.

• Cartrack (Pty) Ltd.

• Calamp Corp

• ORBCOMM INC.

Vehicle Tracking Systems Market Report Scope

Segments Covered in the Report

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2027. For the purpose of this study, Grand View Research has segmented the global vehicle tracking systems market report based on vehicle type, end-use, technology, type, component, and region:

• Vehicle Type Outlook (Revenue, USD Million, 2016 - 2027)

  • Passenger Vehicles

  • Light Commercial Vehicles

  • Heavy Commercial Vehicles

• End-use Outlook (Revenue, USD Million, 2016 - 2027)

  • Transportation & Logistics

  • Construction & Manufacturing

  • Aviation

  • Retail

  • Government & Defense

  • Others

• Technology Outlook (Revenue, USD Million, 2016 - 2027)

  • GPS/Satellite

  • GPRS/Cellular Networks

  • Dual Mode

• Type Outlook (Revenue, USD Million, 2016 - 2027)

  • Active

  • Passive

• Component Outlook (Revenue, USD Million, 2016 - 2027)

  • 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 - 2027)

  • North America

    • The U.S.

    • Canada

  • Europe

    • The U.K.

    • Germany

    • France

  • Asia Pacific

    • China

    • India

    • Japan

  • Latin America

    • Brazil

    • Mexico

  • Middle East & Africa