Pictures of the Future Fall 2005
Intelligent Networking – Facts and Forecasts
Traffic Networking is Booming
The German automobile club (ADAC) estimates the average driver in Germany spends about 65 hours per year in traffic jams. That represents almost 40 million liters of fuel consumed daily—in Germany alone. The resulting cost to the nation’s economy is between 100 and 200 bill. €. More tragically, Europe registers 1.4 million traffic accidents with 1.8 million injuries and 50,000 fatalities every year, according to the European Union.
Vehicle telematic solutions can reduce these economic and human costs by helping drivers avoid traffic jams and find parking places, for example. “Efficient guidance systems in cities are already reducing congestion by 10 % and cutting air pollution by as much as 15 %,” says Professor Edward G. Krubasik, Siemens board member and president of the German Electrical and Electronic Manufacturers’ Association (ZVEI). And the capacity of highways could be increased by about ten percent with telematics systems.
Drivers are also becoming more interested in telematics applications. Frost & Sullivan (F&S) surveyed a cross-section of drivers and found that 88 % of European car owners are interested in solutions such as emergency call systems and navigation aids. In addition to those solutions, truck owners are primarily concerned with vehicle management systems that monitor driver and vehicle behavior while supplying fleet operators with important data for logistical planning and technical monitoring.
In 2004, there were already 4.2 million cars equipped with telematics and infotainment systems in Europe—and navigation systems accounted for 35 percent of the market. By 2010, more than 14 million cars will likely have such systems, according to the F&S study. At that point, GPS systems will come as standard equipment in high-end vehicles and will be installed in 80 % of smaller new cars as well. According to F&S, the European market for telematics and infotainment systems will climb from at least 3.7 bill. € in 2005 to 5.8 bill. € in 2010.
Rapid growth in Europe’s telematics and infotainment systems market
Safety systems and integrated systems will be the primary drivers of this market growth. The former provide aid in emergencies and make it possible to pursue thieves when a car is stolen. Integrated systems combine infotainment features, including navigation, entertainment and digital radio, with systems such as parking assistance, an emergency call system or remote vehicle diagnostics (see Remote Services – Facts and Forecasts in Pictures of the Future, Spring 2005). Whereas only 1.1 million cars were equipped with integrated systems in 2004, about 6.6 million are expected to have such systems by 2010, according to the F&S forecast.
Integrated systems will then have a market share of 38.6 percent. Market researchers base their forecast on drivers’ growing desire for more comfort, safety and entertainment. In addition, integrated systems are so flexible that automakers can adapt them to each vehicle segment in response to the needs of specific customers—in other words, according to whatever the individual customer’s standard of luxury is.
Some automakers intend to offer telematics solutions at lower prices in the future. Fiat, for example, is working with Microsoft on a standardized entry-level telematics solution for the mass market, which is expected to be available in 2006. Telematics will get a further boost from the introduction of toll systems—like the truck toll in Germany and the Europass system in Austria. F&S market analysts expect there will be a toll system in every European country by 2010.
According to the ZVEI, the global market for traffic telematics is worth about 25 bill. €, with annual growth rates between six and seven percent. In the future, the market will experience tremendous growth primarily as a result of standards set by policymakers, public sector investments, and initiatives by industrial associations. By 2010, for example, the EU intends to reduce the costs of commercial traffic by 25 %, delays in local public transport by 15 %, and the number of traffic fatalities by 50 %.
Integrated systems will have the largest market share in 2010
These ambitious goals can only be met with telematics solutions. In Germany alone, 200 mill. € will be made available in the next two years to help develop modern systems for controlling traffic on autobahns. In 2002, the ZVEI launched a vehicle telematics initiative that aims to build a user-friendly electronic travel information system. “By the time the World Cup soccer championship gets under way in 2006, up-to-date traffic information will be available online for travel to any of the 12 stadiums,” says Krubasik. “Ultimately, we want to bring together and expand the many islands of traffic information and make them accessible. But that requires greater cooperation between industry and government.”
Sylvia Trage