The global recession has struck a heavy blow to the global auto industry over the past two years, pushing even the biggest manufacturers (such as Toyota) into the red. Now the industry is recovering in many parts of the world, and auto telematics has again become a hot topic.


Auto telematics is defined as the integrated use of telecommunications and informatics to allow the transmission of information. Telematics devices can be embedded in luxury cars, or used as mobile devices with popular vehicles.


A recent study by iSupply, a market research firm, indicates that sales of auto telematics systems in Western Europe will soar by a factor of five from 2008 through 2016 as carmakers offer more and more telematics-equipped models. iSupply expects sales in the region to expand at a compound annual growth rate (CAGR) of 22.5% over the period, increasing from 4.9 million systems in 2008 to 24.8 million in 2016.

Foreign Suppliers

Automakers are rushing to push telematics systems in Western Europe. General Motors, through European sales of such car brands as Open, Cadillac, Chevrolet, Saab, and Vauxhall, is expected to sell more than 1.4 million telematics units in 2016. That will require a CAGR of more than 41%, rising from 210,000 units in 2008. GM currently offers only telematics systems based on mobile devices.

Ford plans to introduce its “Sync” system in Europe in 2011. This should boost shipments of its mobile telematics systems in the region from 190,000 units in 2008 to 1.7 million in 2016, for a CAGR of 31%.

Japanese brands expect slower sales in Europe, since they are not very strong in that region, according to iSupply. Toyota, which sells more vehicles in Western Europe than any other Japanese carmaker, is also expected to sell more telematics systems there; its sales are predicted to grow at a CAGR of 31%, from 110,000 in 2008 to 990,000 in 2016. The company is likely to introduce built-in telematics devices in the near future, iSupply believes.

Anna Buettner, an auto electronics analyst for iSupply, comments that telematics can provide a range of benefits to motorists, from notifying an emergency operator when a car’s airbags have been deployed to report vehicle conditions to a remote monitoring center.

“iSupply believes that embedded and mobile-device-based telematics systems will continue to coexist in the car market in Western Europe and elsewhere,” Bruettner said. “Embedded solutions are suitable for high-end luxury models, which mobile-device-oriented systems can bring telematics services to high-volume, entry-level cars.”

European Providers

Six big manufacturers control about 64% of the Western European auto market, and they are expected to popularize telematics in their home markets with increasing vigor.

PSA Peugeot Citroen enjoys the highest sales of telematics systems in Europe, including both embedded and mobile systems. Its sales are expected to grow from 620,000 units in 2008 (of which 42% were embedded) to 3.1 million units in 2016.

Telematics sales by Volkswagen are projected to increase at a CAGR of more than 26%, from 490,000 systems in 2008 to 3.2 million units in 2016. VW’s four brands currently use only mobile-device systems, but embedded systems are expected to come in the future.

Fiat’s three car brands are projected to sell 2.3 million telematics units in 2016 (20% embedded), up from 340,000 in 2008, for a CAGR of 27%. Renault has only recently added mobile-device systems to its cars, and sold 190,000 of them in 2008. The figure is expected to grow at a CAGR of 30%, reaching 1.6 million units in 2016.

The two main European luxury brands, BMW and Mercedes-Benz, already sell a high percentage of their cars with telematics systems. BMW uses both embedded and mobile systems; its telematics sales are expected to rise to more than 1.3 million units in 2016, growing at a CAGR of 16% from 390,000 in 2008. Telematics sales by Mercedes-Benz are forecast to expand at a CAGR of almost 20%, from 320,000 units in 2008 to 1.4 million in 2016.

In Taiwan, which lacks a strong auto industry, most of the auto telematics industry is focused on midstream and downstream assembly or manufacturing. However, the Hua-chuang Automobile Information Technical Center Co., a unit of the Yulon Group, has been working hard to develop a homegrown telematics system for Yulon’s LUXGEN own-brand automobiles. The first of these models to be put on the market, the LUXGEN7 multi-purpose van (MPV), has a telematics system on board.

Industry sources observe that Yulon has been trying to develop high-end automotive electronics (including telematics) systems for homegrown car models, which are expected to be strongly competitive in the booming Chinese market.

(by Quincy Liang)