Automotive eCall – Market Drivers and Forecasts from Technavio

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  Technavio publishes a new market research report on the global automotive eCall market from 2016-2020. (Graphic: Business Wire)

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LONDON—Technavio analysts forecast the global automotive eCall market to grow at a CAGR of almost 30% during the forecast period, according to their latest report.

The research study covers the present scenario and growth prospects of the global automotive eCall market for 2016-2020. To calculate the market size, the report considered the unit sales and the revenue generated through the sales of OEM embedded telematics.

The global automotive eCall market is expected to grow at an exponential pace owing to mandatory legislation passed by the EU and Russia. These nations will be followed by the US, China, and Brazil. Improving economic conditions due to increase in disposable incomes and growing concerns for road safety in emerging markets such as India, China, and Brazil are expected to contribute to the growth of the global market.

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Technavio automotive analysts highlight the following four factors that are contributing to the growth of the global automotive eCall market:

• Regulatory mandates stipulating installation of eCall system in automobiles
• OEM's push to capitalize the unexplored potential of developing nations
• Bundling of telematics services by OEMs
• Increased collaboration between nations to share telematics infrastructure

Regulatory mandates stipulating installation of eCall system in automobiles

As per NHTSA the total number of fatalities in the world due to road accidents was 1.25 million in 2015. Although this number has followed a decreasing trend owing to several safety regulations mandated by regulatory bodies worldwide, the number can be reduced further by improving the punctuality of emergency services available to motorists involved in road accidents.

Siddharth Jaiswal, a lead automotive electronics analyst at Technavio, says, “Hence, transportation safety bodies worldwide are making efforts to mandate installation of the eCall system in automobiles. The installation of this system can reduce the emergency service response time by 50%-60%. The EU claims that the implementation of eCall system can save up to 2,500 lives per year.”

OEM's push to capitalize the unexplored potential of developing nations

Developing economies such as China and India have been posting growth in the automotive sector despite the sluggish growth in this sector worldwide. This is due to rising disposable income and rapid urbanization in these nations. Recently, these countries have experienced a rise in ownership of passenger cars that come installed with telematics systems owing to changing customer preferences and increased importance of safety features. Increase in the number of road accidents, vehicle thefts, and safety and security issues while roaming are propelling the market growth for automotive telematics.

“OEMs have been trying to increase their market share in the telematics sector by offering eCall as a standard feature in few models. For instance, Ford has launched EcoSport model in India that provides many smart features, including eCall services. Therefore, increased awareness about telematics systems and increased focus on safety are expected to drive the growth of eCall systems in developing nations,” adds Siddharth.

Bundling of telematics services by OEMs

The revenue generation from eCall system is less as the revenue model depends on the frequency of accidents. Due to the rare nature of accidents, standalone eCall systems are not feasible to manufacture for OEMs. Thus, OEMs have employed strategies wherein they provide bundled telematics offerings rather than standalone eCall systems. Therefore, the eCall market derives its demand from the automotive telematics market.

The global automotive telematics market is expected to grow at a CAGR of around 34% till 2020. This will influence the market for eCall systems. Apart from that, the data recorded by eCall system can be utilized by insurance companies to diversify their product portfolios. The data recorded can not only be used by insurance companies for driver profiling but also to provide suggestions regarding improving driving habits. Few insurance companies like Octo Telematics have already capitalized in this sector.

Increased collaboration between nations to share telematics infrastructure

One of the disadvantages of eCall system is that the hardware needs to be reconfigured according to the emergency services for that region. The European eCall system depends on Galileo and European Geostationary Navigation Overlay Service (EGNOS) satellite navigation systems for generation of MSD and dials 112 (European emergency services) in case of an accident. However, the Russian ERA-GLONASS depends on Russian navigation satellite system GLONASS for MSD generation.

Top vendors:

• Bosch
• Continental
• DELPHI
• Telit
• u-blox

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About Technavio

Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.

Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.

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