ABI: China's Commercial Telematics Market to Exceed $300M by Year's End

June 6, 2007 // Published as a news service by IHS

According to a new study from ABI Research, the Chinese market for fleet management systems (FMS) is expected to be worth more than $300 million by the end of 2007.

By 2012, the value of this market is expected to be nearly $786 million. Subscriber numbers will reach 2.6 million by the end of 2012, with a compound average annual growth rate of 46%.

Analysts said the 2008 summer Olympic Games in Beijing and Shanghai's World Expo in 2010 are expected to trigger an explosion in the commercial telematics market. Most of the taxis and public buses in these two cities have global positioning system (GPS)-enabled FMS installed.

"The taxi and bus monitoring and tracking market has a penetration rate of 80% in this region," said ABI Research analyst Wang Tao.

"We forecast rapid growth for the Chinese commercial telematics market, particularly because of the intense competition among short-range specialty logistics companies and couriers who are implementing FMS to increase their delivery efficiency and competitiveness."

Analysts said research indicates that the growth of the logistics and transport markets will drive a rapid development of the Chinese fleet management market, with hardware shipments showing a compound annual growth rate (CAGR) of 23%.

"Monitoring and tracking are the basic services of China's commercial telematics market, in strong demand for taxis, special cars and logistics and transportation services," Tao said. "Due to the requirements of the road safety and security laws, vehicle data records are another standard function for fleet management system (FMS) in this region."

Source: ABI Research.