15.7% CAGR for Fleet Management Systems in Russia, CIS & Eastern Europe

The number of fleet management systems (FMS) deployed in Russia/CIS and Eastern Europe is expected to grow from 2.9 million in the last quarter 2013 to 5.9 million by 2018.

This study from Sweden-based market research firm Berg Insight forecasts a compound annual growth rate (CAGR) of 15.7 percent.

The penetration rate of FMS in the total population of non-privately owned commercial vehicles is estimated to increase from 12.1 percent in 2013 to 21.7 percent in 2018.

The Russian market accounts for 45 percent of the region’s total installed base and is forecasted to grow at the same path the rest of the region, from 1.3 million active FM units at the end of 2013 to 2.6 million by 2018.

Reduced forecast

Berg Insight has reduced its previous forecast. One year ago (read here) the analyst house was forecasting the regional market to reach 6.1 million monitored vehicles by 2017 – growing at a CAGR of 22.6 percent – and the penetration to grow up to 23.8 percent in 2017. It is clear that the deceleration of the economic growth in Russia is likely to affect directly the transport sector.

Market led by Gurtam

Belarus-based Gurtam is the leading FM software provider active across most countries in the region with over 300,000 commercial vehicles under management.

Other top providers with more than 100,000 active FM units for commercial vehicles in the region include ENDS, NIS group (which includes M2M telematics), Arvento Mobile Systems and TechnoKom which are all top-ranking telematics players on their respective domestic markets. Additional key vendors include SCOUT, Mobiliz, Omnicomm and Fort-Telecom.

Despite the market growth there are also been a few companies struggling. Both M2M Telematics and Russian Navigation Technologies have lost many employees and the latter even filed for bankruptcy in 2014, indicated Berg Insight.

“There has been an inflow of new start-ups gaining market shares at the expense of struggling Russian top telematics playersâ€?, said Rickard Andersson, Senior Analyst, Berg Insight.

A key example is the Russian newcomer SpaceTeam which was founded one year ago and now already holds a significant market share on the domestic market.

“None of the major international solution providers based in Western Europe, the US or South Africa have however so far managed to capture any leading positions in this regionâ€?, said Andersson. He adds that Berg Insight anticipates increased merger and acquisition activities in the region in the upcoming years as the ongoing consolidation wave in Europe and North America reaches the Russian telematics market.

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