China: The Next Big Market for Fleet Management Systems?

A new study from Berg Insight indicates that the number of vehicles monitored by fleet management system is set to increase 22.9 percent per year between 2014 and 2019.

In the last quarter of 2014 there were 2.1 million such vehicles, they are forecast to reach 5.9 million by 2019.

The penetration rate in registered commercial vehicles including trucks and buses is estimated to increase from 9.0 percent in 2014 to reach 19.8 percent in 2019.

In comparison 7.1 million European vehicles are expected to be monitored in 2018 (read here) and 12 million American vehicles in 2019 (read here) according to the same research firm.

Berg Insight notices that “Track & trace systems dominate the market and the installed base so far includes a significant share of low-end systems with comparatively limited functionality by Western standards.“

The research firm based its growth forecast on two drivers: political decisions to track selected commercial vehicles and the booming e-commerce market which creates demand for efficient transport operations.

Top local telematics providers

There are two Chinese telematics providers with installed bases of more than 100,000 units: E6GPS and Etrans.

There are furthermore a number of players with installed bases in the range of around 50,000—100,000 units, including Beijing Zhongdou Technology (Ccompass), Shenzhen Huabao Electronics Technology, Shenzhen Weitongda Electronics and 666GPS.

Other players with installed bases of approximately 50,000 units include Zhengzhou Shenyang Science & Technology, Shenzhen SOFAR Communication, Shanghai Transun Telematics Technology, Sinocastel, Baoding Beier Electronics and Aerospace Intelligent.

Berg Insight also reported that a small number of international aftermarket solution providers have entered the Chinese fleet management market but with limited reach thus far. Among the few international providers that have entered this market and achieved installed bases of at least 1,000 units are Trimble, MiX Telematics, Microlise and Navman Wireless.

“There are regulatory hurdles for foreign players related to maps, data handling and SaaS modelsâ€?, said the report’s lead author Jan Unander. Indeed Chinese authorities do not not accept the export of Chinese maps so foreign companies have to locate their servers on Chinese ground.

He expects these issues to remain in the upcoming years. Berg Insight however expects interesting developments for Western fleet management companies on this fast-growing market.

Leave a Reply

Your email address will not be published. Required fields are marked *