Annual Worldwide Sales of Factory-Installed Telematics Systems Push 12M Units by 2011
MINNETONKA, Minnesota--Aug. 30, 2006--According to Telematics Research Group, annual sales of cars in the U.S. with factory-installed telematics systems will grow from 2.9M units in 2006, to 5.4M in 2011. Worldwide annual sales will grow from 4.3M units in 2006, to 11.7M in 2011.Fueling this growth is GM's decision to make OnStar standard equipment on most vehicles it sells next year. Due to new hardware these systems can dispatch road side assistance, safety, and a new service for delivering Turn-by-Turn (TbT) navigation to cars.
Telematics systems were once limited to a few services related to roadside assistance or emergency calls and thus had limited appeal. But new technologies have enabled these systems to offer more LBS related content. New services from GM's OnStar, and Mercedes-Benz's TeleAid, can download information to a vehicle and provide turn-by-turn instructions to a specific location or point of interest (POI).
OnStar's recently-introduced Turn-by-Turn (TbT) navigation, a service supported by OnStar's latest generation of hardware costs $100 per year and does not require a traditional navigation system. According to OnStar, Turn-by-Turn navigation (the hardware) will soon become standard equipment on many '07 models pushing this type of navigation solution to about 2 million GM car buyers next year.
Meanwhile, Mercedes-Benz, who introduced its Destination Download service earlier this year, charges $2.95 for each destination downloaded to the M-B system. The M-B system is available on two models ('07 S-Class and CL-Class) -- both of which come standard with the necessary hardware. Unlike the OnStar system, the M-B system requires use of the installed map data while the OnStar solution downloads a corridor of map data for a chosen route.
Meanwhile, telematics systems can, and are being used for more than just convenience and navigation. The embedded communication hardware can facilitate remote diagnostics and vehicle maintenance enabling auto makers to collect data from millions of drivers. BMW's Assist telematics and GM's OnStar have begun to do this currently and we expect more roll outs once other automakers add telematics hardware to their vehicles over the next few years.
According to TRG, annual sales of telematics will accelerate due largely to GM's OnStar deployment. Cumulative telematics system sales will reach nearly 10M in the U.S. in 2006 and will approach 36M in 2011. Worldwide cumulative telematics sales will reach 16M in 2006 and will top 59M in 2011.
TRG: Monitored Telematics Market
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USA USA WW WW
2006 2011 2006 2011
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Yearly Unit Sales (Millions) 2.9 5.4 4.3 11.7
Cumulative Unit Sales (Millions) 9.8 35.8 16.0 59.3
Monitored Telematics Subscribers (Millions) 4.5 12.2 6.2 26.5
Monitored Telematics Subscriber Revenue ($B) 0.6 1.7 1.0 4.5
Meanwhile, TRG states subscribers of telematics services in the U.S. will reach 4.5M in 2006 resulting in service revenue opportunity of over $600M. TRG predicts by 2011 U.S. telematics subscribers will top 12M resulting in $1.7B in revenue.
Worldwide monitored telematics subscribers will reach 6.2M in 2006 with service revenue of $1B, which will grow to 26.5M subscribers in 2011 resulting in $4.5B in yearly revenue.
These estimates are extracted from TRG's Automotive Forecast Portal, a research portal that provides forecasts and market analysis on the telematics, navigation, audio, hands-free, driver assist systems and the many component and subsystems used in automotive electronics.