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Smart Transportation Market Size, Share & Industry Analysis, By Solution (Traffic Management System, Integrated Supervision System, Parking Management System, Ticketing Management System), By Service (Business, Professional, Cloud) and Regional Forecast, 2024-2032

Last Updated: July 08, 2024 | Format: PDF | Report ID: FBI105736

 

KEY MARKET INSIGHTS

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The global smart transportation market size was valued at USD 115.73 billion in 2023 and is projected to grow from USD 126.76 billion in 2024 to USD 340.69 billion by 2032, exhibiting a CAGR of 13.2% during the forecast period.


The smart transportation market refers to the sector focused on implementing advanced technologies and innovative solutions to improve the efficiency, safety, sustainability, and overall effectiveness of transportation systems. Smart transportation encompasses various modes of transportation, including roadways, railways, airways, and maritime routes, and integrates a range of intelligent technologies and data-driven approaches to optimize mobility and enhance the traveler experience.


Smart transportation relies on the deployment of intelligent infrastructure, including sensors, cameras, GPS systems, and communication networks, to collect real-time data and monitor transportation systems. This infrastructure enables the continuous monitoring of traffic flow, vehicle movements, infrastructure conditions, and environmental factors, facilitating proactive decision-making and optimization of transportation operations.


As public transportation systems are extremely susceptible to disease outbreaks, transit agencies increasingly focus on data-driven decisions to adapt services and restore rider trust. Technologies such as AI (Artificial Intelligence) and IoT (Internet of Things) can help in balancing operations by adjusting to comprehensive data offered on ridership peaks and lows. Technologies used in smart transportation will provide users with detailed transport data such as real-time arrival information to avoid waiting at crowded stations and how full a train or a bus is, among other benefits.


Smart Transportation Market Trends


Increasing Focus on Interoperability of Systems is a Prominent Smart Transportation Market Trends


A key area of focus for key players in the market that includes mobile network operators and automakers is increasing the coordination of communication protocols that different organizations have developed independently. For instance, the Dutch Ministry of Infrastructure and Water Management developed the Transport Operator to Mobility as a Service (MaaS) Provider - Application Programming Interface (TOMP API). It is a standardized interface that allows communication regarding booking, support, and end-user-specific multimodal trip payments.


Such a system enhances interoperability between participating companies in the intelligent transportation ecosystem. Hence, these factors will positively influence the growth of the market.


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Smart Transportation Market Growth Factors


Increasing Volume of Traffic to Drive Growth of This Market


Traffic problems are rising owing to an exponential increase in suburban and rural residents moving to cities and the equivalent surge in population density around urban areas. With rapid density growth, vehicular congestion in cities has also increased, aided by inadequate highway designs and poor urban planning. For instance, traffic congestion alone cost more than USD 200 billion in 4 developed economies (U.K., France, U.S., and Germany).


It leads to a high number of accidents, money & time lost in commuting, and overall loss of economic growth & productivity. However, through remote sensors, autonomous vehicles, 5G networks, vehicle-sharing services, dynamic traffic signals, and better infrastructure, automotive safety and efficiency can be increased. Hence, these factors are driving the demand for smart transportation networks.


Ongoing Technological Advancements to Augment Growth


Internet of Things (IoT) based devices gather and transmit real-time data to people about traffic, weather, and incidents, among other activities, to plan their journeys more effectively. Increasing adoption by transit agencies in applications such as train control systems, toll collection systems, fleet telematics, and transport logistics has improved system capacity while minimizing operating costs.


Furthermore, the need to manage the increasing amount of data generated through the vast number of IoT devices used in the transport infrastructure is also creating significant new revenue streams for service providers and independent software vendors, among other solution providers. Hence, technological advancements of the current transportation infrastructure will drive the smart transportation market growth.


RESTRAINING FACTORS


Lack of Standardized Technology to Restrain Growth


Smart transportation combines various elements such as hardware, software, and mobile network components developed by multiple vendors, leading to compatibility issues due to the absence of a standardized approach. Furthermore, communication protocols also differ substantially across different countries, creating problems for manufacturers regarding the global adoption of their technologies.


For instance, in China, 5G networks have been implemented in more than 50 cities. The country has also adopted cellular vehicle-to-everything (C-V2X) as the standard communication protocol for vehicular communications. However, the European Union has maintained DSRC (dedicated short-range communication) as its communication technology protocol and rejected a measure introduced in 2018 to shift to C-V2X. Hence, a lack of standardization will restrain the growth of the market.


Smart Transportation Market Segmentation Analysis


By Solution Analysis


Traffic Management System Segment to Dominate Owing to Increasing Pressure on Current Infrastructure


By solutions, the market is segmented into ticketing management systems, parking management systems, integrated supervision systems, and traffic management systems. The traffic management system (TMS) is expected to dominate the market during the forecast period. Smart traffic lights, route guidance systems, and integrating CCTV cameras to provide real-time information are prominent TMS solutions. Growing traffic volumes and inefficient usage of existing road infrastructure will propel the demand for traffic management solutions.


The parking management segment is also expected to show considerable growth in the market. It includes equipping parking facilities with beacons & sensors to lead drivers to available spots and providing information regarding on-street parking on any block through an app, among other solutions. These solutions directly lead to reduced vehicle congestion, reduced cruising, and more efficiency in terms of utilizing maximum capacity and revenue generated by the parking facility. Hence, these factors will fuel the growth of this segment.


By Service Analysis


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Cloud Services Segment Dominated in 2023 Fueled by High Volume of Data Generation


Based on service, the market is segmented into business, professional, and cloud services. The professional services segment is anticipated to exhibit substantial growth during the forecast period propelled by the surge in demand for consulting services. They provide implementation support, design advice, strategy development, among other functions for various subsystems, and help upgrade existing infrastructure systems. Hence, these factors will fuel the growth of this segment.


The cloud services segment held the largest share of the market in 2020. The increasing complexity of harnessing and managing the large amount of data generated through mobile technologies and sensors will propel the demand for cloud services.


REGIONAL INSIGHTS


Europe Smart Transportation Market Size, 2023 (USD Billion)

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Europe held the largest share of the market and stood at USD 45.67 billion in 2023. It can be attributed to the substantial funding for infrastructure through grant programs such as the Connecting Europe Facility (CEF), which continues to contribute to providing the European Green Deal with additional financial support of USD 6.6 billion for 107 new projects on the Trans-European Transport Network. Overall, 82% of this funding concerns transport infrastructure that contributes to climate objectives in line with the Union’s commitments. In addition to developing a more efficient, greener, and smarter network of railways, inland waterways, and maritime infrastructure within the EU, the support will  improve the cross-border connections with Ukraine and Moldova along the Solidarity Lanes. Hence, these factors will fuel the growth of the market in this region.


Asia Pacific is anticipated to exhibit a higher CAGR during the forecast period. It can be attributed to the supportive regulatory measures that have facilitated the rapid advancement of smart transportation infrastructure in countries such as China and South Korea.


Hence, several provinces implemented pilot projects that include Guangdong, Hebei, and Beijing, among others. Furthermore, to provide substantial support for smart transport applications, the National Intelligent Transportation System Standardization Technical Committee has issued more than 90 communication standards. Hence, these factors are driving the growth of the market in this region.


North America is also expected to show good growth in the market. In the US, cooperation between federal and state authorities has increased over policy guidance and financing, hence accelerating road testing and software development.


List of Key Companies in Smart Transportation Market


Iteris is one of the Leading Players in the Market Owing to Strategic Partnerships


A broad product portfolio and considerable focus on strategic partnerships have enabled Iteris to capture a significant market share. For instance, in April 2021, Iteris and Continental AG announced a collaboration agreement to leverage automotive sensors and infrastructure-to-vehicle (I2V) connectivity to make city transportation systems across North America more efficient. It will advance connected and automated vehicle technology with real-world vehicle-to-everything (V2X) solutions.


Similarly, the company entered into a Solution Technology Integrator (STI) agreement with Cisco Systems. The company can integrate Cisco hardware and software into its smart transportation systems solutions for public agencies across the U.S. Furthermore, Iteris can now also act as a direct reseller of Cisco software and hardware to public agencies, focusing on this market. Hence, these factors will boost the growth of the company in this market.


LIST OF KEY COMPANIES PROFILED:



  • IBM Corporation (New York, U.S.)

  • Cisco Systems, Inc. (California, U.S.)

  • Kapsch TrafficCom (Vienna, Australia)

  • Cubic Corporation (California, U.S.)

  • Xerox Corporation (New York, U.S.)

  • Siemens AG (Munich, Germany)

  • Iteris, Inc. (California, U.S.)

  • LG CNS Co. Ltd. (Seoul, South Korea)

  • Thales Group (La Defense, France)

  • Indra Sistemas (Alcobendas, Spain)

  • Trapeze Software (Ontario, Canada)

  • TransCore Inc. (Tennessee, U.S.)


KEY INDUSTRY DEVELOPMENTS:



  • In August 2023, NEC Corporation signed a contract with NEC India for the Vehicle Location Tracking-Passenger Information System (VLT-PSIS) project under the Nirbhaya fund of the Government of India. This enterprising project aims to address critical safety concerns in buses while promoting the overall travel experience of passengers through the implementation of advanced cutting-edge technologies

  • In April 2022, The Ministry of Electronics and Information Technology (MeitY) has launched several applications under the Intelligent Transportation System (ITS) as part of the InTranSE- II program to improve India's traffic scenario. The government said that ODAWS aims to improve the highway infrastructure as the number of vehicles, speed on roads has increased, exacerbating safety concerns.

  • In April 2024, The General Directorate of Highways unveiled ambitious plans to improve Turkey's transportation infrastructure by introducing smart technology initiatives aimed at optimizing routes and increasing efficiency. Referring to the institution's strategic plans for the coming years, the General Directorate highlighted the goals of these projects, including reducing travel time, improving road safety, and efficiently utilizing energy and existing road capacity.

  • In May 2023, Cisco signed an MOU with the National Transport Commission (NTC) to accelerate the development of digital rail skills across Australia and improve rail interoperability. Cisco will collaborate with NTC to bridge the digital skills gap and to support the development of the digital workforce to improve rail interoperability as part of the NTC’s National Rail Action Plan. The proposed collaboration aims to identify and accelerate the development of baseline digital rail skills relevant to passenger and freight networks.

  • March 2021 – A $500,000 traffic signal synchronization and intelligent transportation systems (ITS) project to Iteris, Inc. by the Illinois Department of Transportation (IDOT). As part of the project, state-of-the-art traffic signal systems will be used to upgrade and modernize existing traffic signals along with signal coordination and timing (SCAT) improvements at key signalized intersections.


REPORT COVERAGE


The smart transportation market research report covers a detailed analysis of the market and focuses on key aspects such as leading companies, product types, and leading applications of the product. Besides this, the report offers insights into the key market trends and highlights key industry developments. In addition to the aforementioned factors, the report delivers an in-depth market analysis of several factors that have contributed to its growth over recent years.


An Infographic Representation of Smart Transportation Market

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Report Scope & Segmentation
















































ATTRIBUTE



DETAILS



Study Period



2019-2032



Base Year



2023



Estimated Year



2024



Forecast Period



2024-2032



Historical Period



2019-2022



Growth Rate



CAGR of 13.2% over 2024 to 2032



Unit



Value (USD Billion)



Segmentation



By Solution



  • Ticketing Management System

  • Parking Management System

  • Integrated Supervision System

  • Traffic Management System



By Service



  • Business

  • Professional

  • Cloud



By Geography



  • North America (By Solution, By Service)

    • U.S.  (By Solution, By Service)

    • Canada (By Solution, By Service)

    • Mexico (By Solution, By Service)



  • Europe (By Solution, By Service)

    • U.K. (By Solution, By Service)

    • Germany (By Solution, By Service)

    • France (By Solution, By Service)

    • Rest of Europe (By Solution, By Service)



  • Asia-Pacific (China, Japan, India, South Korea, and Rest of Asia- Pacific)

    • China (By Solution, By Service)

    • Japan (By Solution, By Service)

    • India (By Solution, By Service)

    • South Korea (By Solution, By Service)

    • Rest of Asia Pacific (By Solution, By Service)



  • Rest of the World (By Solution, By Service)






Frequently Asked Questions

Fortune Business Insights says that the global market size was USD 115.73 billion in 2023 and is projected to reach USD 340.69 billion by 2032.

In 2023, the Europe market value stood at USD 45.67 billion.

Registering a CAGR of 13.2%, the market will exhibit decent growth over the forecast period (2024-2032).

The cloud services segment held the largest share of the market in 2023.

Substantial funding through grant schemes for smart transportation systems, particularly in developed countries, is the key factor driving the market growth.

Iteris, Cisco Systems, and Thales Group are the major players in the global market.

Europe held the highest share in the market in 2023.

The increasing volume of traffic, especially in emerging economies, the need for efficient traffic management solutions, and technological advancement are expected to drive the growth of the market.

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