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Frost & Sullivan Predicts that Nearly Half of Vehicles Produced Annually by 2017 will Have Fleet Management System as Standard Line-fit - Initial free subscription period to expand base of active subscribers, push adoption of FMS - Automotive.Frost.com
Frost & Sullivan Predicts that Nearly Half of Vehicles Produced Annually by 2017 will Have Fleet Management System as Standard Line-fit

 

PRZOOM - /newswire/ - London, United Kingdom, 2012/03/06 - Initial free subscription period to expand base of active subscribers, push adoption of FMS - Automotive.Frost.com.

   
 
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Vehicle OEMs have traditionally focused on their core competency of vehicle usage and vehicle analysis, rather than transport operation. This has placed them at a disadvantage to independent aftermarket telematics vendors, whose core competence is in transport operation. OEMs have typically limited client contact after selling the vehicle. But this is expected to change once OEMs gradually start offering fleet management systems (FMS) as a standard in their models.

New analysis from Frost & Sullivan (automotive.frost.com), Strategic Update of European Medium and Heavy-duty Commercial Vehicle Telematics Market, finds that the market registered sales of 542 million in 2010 and estimates this to reach 1.3 billion in 2017. Frost & Sullivan anticipates almost half the vehicles produced to have a FMS as a standard line-fit by 2017. Telematics solutions supporting an open and flexible platform will allow vehicle manufacturers to survive long-term in this competitive market.

"The current trend of offering FMS as a standard in line-fit has slowly started, with each OEM having mapped out its own strategy based on its business needs," notes Frost & Sullivan Industry Analyst Sathyanarayana Kabirdas. "Such an approach is poised to increase OEMs' year-on-year FMS installed base in the coming year and neutralise competition."

Some OEMs might consider offering FMS as a standard based on the country in which they are being offered, while others might base it on models, changing platforms, miles driven or pricing. At present, however, most OEMs consider the particular market or country, when offering FMS as standard.

"Certain models sold in Benelux, France or Germany for example, have FMS as a standard, while the same models sold in Italy or Ukraine do not have FMS as standard simply because of the varying level of demand and awareness," states Sathyanarayana.

A key issue for OEMs is that hardware penetration might not necessarily equate to service penetration. This is because some operators do not want to be linked to OEMs or to a particular OEM. At the same time, some OEMs do not have the capability of expanding outside their own vehicle line. Moreover, operators with mixed fleets do not favour OEMs' base-telematics system. Thus, even with the hardware in place, OEMs are unlikely to win all the associated service opportunities.

"Even if OEMs start to offer FMS as a standard, there is always a difference between hardware being in place and the service being activated – these two things are very different," explains Sathyanarayana. "The presence of the hardware in the truck does not necessarily mean that it is going to be used by the fleet operator."

This strategy of offering a standard quality fitment, suiting all types of customers and extending the continued relationship, is expected to have a positive influence on the market presence of OEMs in the coming years. This strategy will not only help OEMs to increase their base of active subscribers but will also help them collect a large pool of real-time vehicle specific data to build better trucks for the future.

"The best way to increase the base of active subscribers is by offering an initial free subscription period of at least a few months or years," advises Sathyanarayana. "This will allow the truck owners to realise the benefits of FMS."

If you are interested in more information on this study, please send an email with your contact details to Katja Feick, Corporate Communications, at katja.feick[.]frost.com.

Strategic Update of European Medium and Heavy-duty Commercial Vehicle Telematics Market is part of the Automotive & Transportation Growth Partnership Service programme, which also includes research in the following markets: Strategic Analysis of North American Medium and Heavy-duty Commercial Vehicle Telematics Market (Class 4 to 8 Vehicles), Strategic Analysis of North American Trailer Telematics Market and Strategic Analysis of the European Trailer Telematics Market. All research included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants.

About Frost & Sullivan
Frost & Sullivan (frost.com), the Growth Partnership Company, enables clients to accelerate growth and achieve best-in-class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best-practice models to drive the generation, evaluation, and implementation of powerful growth strategies. Frost & Sullivan leverages 50 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from more than 40 offices on six continents.

Strategic Update of European Medium and Heavy-duty Commercial Vehicle Telematics Market (M6E6-18).

 
 
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Frost & Sullivan Predicts that Nearly Half of Vehicles Produced Annually by 2017 will Have Fleet Management System as Standard Line-fit

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