The use of commercial fleet management or telematics systems in North America is expected to increase at a 15.3 percent compound annual growth rate over the next four years, as tighter trucking regulations in the U.S. drive adoption of technology, Berg Insight said today.
The fleet management technology industry will also consolidate and become increasingly global, the Swedish technology market research firm said, with the total number of onboard telematics units in vehicles in North and South America reaching 12 million by 2018.
That will mean more data flowing from trucks and onboard devices back to motor carriers and fleet operators, with more data on freight being directed to shipper customers, as well. Increased use of onboard technology will also enable more vehicle-to-vehicle communications and interconnected supply chains.
“Berg Insight anticipates a future scenario where the global fleet management market is dominated by a handful of providers with installed bases measured in the millions,” Senior Analyst Rickard Andersson said as the company released a report on the technology.
“Fleet management” covers a broad range of technologies, markets and companies, the research firm said, including commercial trucking, private fleets of cars and field technicians. Among the biggest companies are Fleetmatics, Trimble, Zonar Systems and Telogis, which all have more than 300,000 active units in North America, according to Berg Insight.
The research firm also cited Omnitracs, which as part of Qualcomm pioneered mobile communications and fleet management in the 1980s. Now a stand-alone company, Omnitracs late last year acquired Roadnet Technologies, a routing and dispatch software provider. Last month, Omnitracs agreed to acquire fleet management rival XRS for $178 million.
The total number of fleet management systems deployed in North America reached 4 million in the fourth quarter of 2013, Berg Insight said. By 2018, that number is expected to hit 8.1 million. The company also expects strong growth in the use of fleet management systems in Latin America. The number of active systems installed in vehicles in Central and South America is expected to increase 16.1 percent annually through 2018 to reach 3.9 million units.
The fleet management or telematics business is increasingly international, Berg Insight said. Global fuel card and workforce payment provider FleetCor acquired NexTraq in the U.S., while tire maker Michelin acquired the leading Brazilian fleet management provider, Sascar.
“These two deals are particularly interesting due to the fact that the well-known acquirers are newcomers to the fleet management space,” said Andersson. Both FleetCor and Michelin decided to enter the fleet management market after identifying synergies between their products and fleet management systems. In much the same way, Trimble acquired PeopleNet in 2011, adding the trucking telematics company to its transportation and logistics division.