Vehicle Analytics Market Size, Share & COVID-19 Impact Analysis, By Application (Predictive Maintenance, Traffic Management, Safety & Security Management, Driver & User Behavior Analysis, Dealer Performance Analysis, Usage-Based Insurance, and Others), By Component (Software and Services), By Deployment Model (On-Premises and On-Demand), By End-User (Original Equipment Manufacturers (OEMs), Automotive Dealers, Fleet Owners, Regulatory Bodies, Insurers, and Service Providers), and Regional Forecasts, 2021-2028

The global vehicle analytics market size was USD 2.03 Billion in 2020. The global impact of COVID-19 has been unprecedented and staggering, with vehicle analytics witnessing a negative demand shock across all regions amid the pandemic. Based on our analysis, the global market exhibited a lower growth of 11.46 % in 2020 compared to the average year-on-year growth during 2017-2019. The market is projected to grow from USD 2.35 Billion in 2021 to USD 10.65 Billion in 2028 at a CAGR of 24.06% in the 2021-2028 period. The gradual growth in CAGR is attributable to the rise in the market’s demand and post-pandemic growth.

Vehicle analytics is an advanced technology that tracks real-time information about the current state of the vehicle. It enables end-users, including OEMs, insurers, fleet owners, and others, to gain real-time insights from the vehicle’s current position. The platform is primarily utilized to monitor, analyze, and improve vehicle and driver performance. This improved vehicle and driver performance further ensures a safe driving experience.

The technology is used for various applications, including traffic management, predictive maintenance, usage-based insurance, and others. Additionally, the growing adoption and availability of connected vehicles are expected to boost the demand for vehicle analytics in the forthcoming years. Moreover, almost all the new-generation electric cars are equipped with various telematics, IoT devices, and sensors for performance improvement. This further increases the demand for automotive analytics to analyze the gathered data from these devices.

Automakers, dealers, and insurers are utilizing analytics tools to analyze vehicle information for useful insights. Automakers are using these insights to improve service offerings for strengthening their position in the competitive market. Moreover, growing competition among these automakers to consolidate the market is expected to propel the global vehicle analytics market growth during the forecast period.

Disruption in Automotive Production amid COVID-19 to Hamper Market Growth

The Covid19 pandemic severely affected the overall automotive sector. Closed manufacturing facilities due to government-enforced lockdown and disruption in the supply chain as a result of travel and transport restrictions caused a significant drop in automotive production and sales volume. Therefore low demand for vehicle analytics in new automobiles cause by dropped automotive production and sales volume, hampered the market growth in 2020.

LATEST TRENDS

Development and Adoption of Connected Vehicles to Drive Market Growth

Digitalization is one of the vital factors behind the development of the automotive industry. Advanced automotive such as connected vehicles are equipped with various digital sensors and systems that can be connected through the internet, cloud services, and other digital services. Additionally, these vehicles can share real-time information, which can significantly reduce fatalities caused by road crashes.

Connected vehicles generate a huge amount of real-time data such as vehicle acceleration, position, engine temperature, speed, and braking, among others. OEMs, service providers, insurers, and others utilize automotive data analytics to obtain insights from this data. Hence, the growing development and adoption of connected vehicles are expected to boost the demand for vehicle analytics in the foreseeable future. Moreover, automotive analytics for connected vehicles helps to improve the traffic flow in urban regions and further drives market growth.

According to the Safe International Road Travel Association, approximately 1.35 million people die in road crashes each year globally. Hence, demand for safe road travel and efficient traffic flow is expected to accelerate the market growth in the forthcoming years.

DRIVING FACTORS

Rising Popularity of Autonomous Mobility to Aid Market Growth

Competition regarding the development of autonomous mobility is already high among automakers. Additionally, data insights generated from automotive analytics are the basis of autonomous mobility. Hence, increasing investment of OEMs in the development of self-driving or fully autonomous vehicles is anticipated to drive market growth in the forthcoming years. For instance, in February 2019, Hyundai announced its plans to invest USD 12.3 billion in growth areas such as vehicle electrification, autonomous driving technology, and mobility. Moreover, companies like Uber, Tesla, and others are also investing in autonomous mobility development, which is further anticipated to boost the market growth during the forecast period.

Increasing Demand for Usage-Based Insurance (UBI) to Accelerate Market Growth

Usage-based insurance (UBI) is a type of insurance in which policy premium is directly linked to vehicle usage. Insurers use analytics tools to access real-time vehicle usage insights and charge the premium accordingly. Increasing demand for usage-based insurance in developed countries is anticipated to accelerate the market growth during the forecast period. Moreover, during the COVID-19 pandemic, less automotive use than regular usage due to government-imposed lockdowns, consumers' focus is inclined towards UBI. This is expected to create a positive influence on the market growth.

RESTRAINING FACTORS

Growing Safety Concerns Regarding Cybersecurity May Hinder the Market Growth During the Forecast Period

The use of automotive data analytics creates concerns regarding cybersecurity due to its cloud service and internet connectivity. Additionally, being advanced technology, automotive analytics hasn’t penetrated the automotive market of a few underdeveloped and developing economies, which further hampers the market’s growth in those specific countries.

SEGMENTATION

By Application Analysis

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Growing Consumer Preference for Predictive Maintenance to Drive Segment Growth

Based on Application, the market is segmented into predictive maintenance, traffic management, safety & security management, driver & user behavior analysis, dealer performance analysis, usage-based insurance, and others. The predictive maintenance segment is expected to hold the largest market share of 21.69 % by 2028. Increasing sales and adoption of connected vehicles is driving the segment growth. Additionally, logistics and transportation companies highly prefer to employ predictive maintenance features in their fleet to reduce downtime and improve driver safety and performance. Moreover, a predictive maintenance system analyzes the components and provides alerts whenever maintenance is required; hence, it reduces the possibility of over or under maintenance.

The usage-based insurance UBI segment is expected to witness the highest CAGR of 26.1% during the forecast period. Usage-based insurance is a type of insurance that decides policy premium as per the vehicle usage. The increasing popularity of UBI among the populace of developed regions is driving the segment growth. Additionally, with the growing adoption of connected vehicles in emerging countries, the penetration of UBI is also expected to grow in these developing economies, which is anticipated to expand segment growth in these regions.

By Component Analysis

The Software Segment is Anticipated to Hold the Largest Market Share By 2028, Owing to its High Demand

Based on the component, the market is segmented into software and services. The software segment is expected to hold the largest market share of 55.47 % by 2028. Increasing demand for software solutions and applications that streamline real-time data in connected vehicles is expected to propel the segment growth during the forecast period. Additionally, various key players provide software solutions to the consumers as it is accountable for controlling the system. The services segment is also expected to experience a significant CAGR of 23.5% over the forecast period. An increasing number of service providers and their focus on expanding services offered is expected to drive the segment growth.

By Deployment Model Analysis

The Suitability & Convenience Provided by the On-Demand Deployment is Expected to Drive the Segment Growth During the Forecast Period 

Based on the deployment model, the market is segmented into on-premises and on-demand. The on-demand segment is anticipated to hold the largest market share of value, 84.28 %, by 2028. The growing popularity and ease of cloud services are expected to drive the segment growth. Additionally, on-demand service is less expensive compared to on-premises as it requires a data center to store the data. Moreover, the cloud provides access to the data from anywhere, unlike on-premises. Rapid growth in the adoption of cloud deployment is expected to propel the on-demand segment growth in the coming years.

By End-User Analysis

Increasing Competition Among the Automakers is Driving the OEM Segment Growth

Based on end-user type, the market is segmented into Original Equipment Manufacturers (OEMs), automotive dealers, fleet owners, regulatory bodies, insurers, and service providers. The OEMs segment is expected to hold the largest market share of 31.01 % by 2028. OEM’s increasing adoption of automotive data analytics to improve the driving experience and product offering is expected to drive the segment growth. Additionally, growing competition among the automakers to consolidate the market by providing advanced services such as predictive maintenance, personalized driving experience, road safety features, and others are anticipated to propel the segment growth.

Insurers is the fastest-growing segment with a CAGR of 29.0% during the forecast period. The growing adoption of usage-based insurance UBI in developed countries is expected to fuel the segment growth. Moreover, increasing penetration of connected vehicles in underdeveloped and developing countries is expected to provide insurers revenue growth and expansion opportunities. The service providers segment is also expected to hold the second-largest market share. An increasing number of service providers and their expanding service portfolio are driving the segment growth. 

REGIONAL INSIGHTS

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North America dominated the global vehicle analytics market in 2020 with market size of USD 0.78 billion and is expected to continue its dominance during the forecast period. The high adoption rate of connected vehicles and e-mobility in the region is driving the market growth. Additionally, key players in the region such as Microsoft, IBM, and others further support the market growth. Moreover, the increasing popularity of usage-based insurance in developed countries in North America is expected to boost market growth over the forecast period. The growing development and availability of autonomous mobility are expected to influence the market in the region.

Asia Pacific is expected to witness the fastest growth of CAGR 28.1% over the vehicle analytics market forecast period. China is expected to fuel the market growth in the region with the high connected vehicle sales. Additionally, overburdened public transport and increasing demand for efficient traffic management systems for smooth traffic flow are expected to drive market growth. Moreover, the growing penetration of advanced technology companies and usage-based insurance is expected to expand market growth in the emerging countries of APAC, including China, India, Japan, South Korea, and others.

In 2020, Toyota, one of the prominent connected vehicle providers from APAC, sold 2 million vehicles. After the pandemic, the rebounding automotive sector is further expected to propel connected vehicle sales over the forecast period.

Europe held the second-largest market share of the global market in 2020. The well-established automotive sector and the strong presence of key players are expected to drive market growth in Europe during the forecast period. For instance, Top three automotive groups Volkswagen, Renault, Nissan Alliance, and PSA, accounted for almost half of the connected car shipments in Europe in 2019. Additionally, increasing deployment of the 5G network in the developed European countries is anticipated to propel market growth in coming years.

KEY INDUSTRY PLAYERS

SAP SE is a Leading Player in the Market with its Industry-Leading Products

SAP SE is one of the leading vehicle analytics providers headquartered in Germany. The company provides automotive analytics software and services to customers. SAP vehicle analytics software offers to manage connected vehicles with the assistance of online data analytics. This can also be used for vehicle diagnostics, mobility as a service, and fleet management or analytics.

The company is focused on offering enhanced solutions and services to various verticals, including logistics, insurance, and others. Hence these verticals can utilize vehicle data such as vehicle driving condition, geo-location, climatic changes, and others to generate insights related to arrival or delay timing and validate vehicle damage. SAP also provides additional solutions related to speed-limit analysis and geo-fencing. This can be used for telematics and digital farming. Clients can associate real-time telematics data with their business processes and integrate it with customer data to increase efficiency and productivity.

LIST OF KEY COMPANIES PROFILED:

• SAP SE (Walldorf, Germany)


• IBM Corporation (New York, U.S.)


• Genetec Inc (Montreal, Canada)


• Cloud Made Ltd. (London, U.K.)


• HARMAN International Industries Inc. (Stamford, U.S.)


• Intelligent Mechatronic Systems (Waterloo, Canada)


• Microsoft (Washington, U.S.)


• Agnik LLC (Columbia, U.S.)


• Pivotal Software, Inc. (San Francisco, U.S.)


• Teletrac Navman (California, U.S.)

KEY INDUSTRY DEVELOPMENTS:

• November 2020: SAP Launched the Digital Vehicle Hub Application SAP Digital Vehicle Hub application offers a central repository to manage vehicle-related data, usage data, transactional data and creates a digital twin of a physical vehicle. The solution assists companies in sharing vehicle data between relevant stakeholders and further enables a collaborative business model along with mobility and the automotive value chain.


• July 2020: IBM Released IBM IoT Connected Vehicle Insights Version V3.1 Update IBM released an IoT connected vehicle insights version update with various enhancements in features. The enhancement includes the Asset Management component, Data archiver for HBase data, Context mapping enhancements which further include (dynamic road data and traffic speed prediction), Driver Behavior datastore, and Mutual TLS authentication enhancement.

REPORT COVERAGE

An Infographic Representation of Vehicle Analytics Market

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The market research report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product types, and leading product applications. Besides this, the report offers insights into the market trends and highlights key industry developments. In addition to the factors above, the report encompasses several factors that have contributed to the growth of the market over recent years.

Report Scope & Segmentation