Rental sector to increase uptake of telematics
By Helen Wright13 October 2014
Demand for telematics from the North American construction equipment rental market is expected to increase between 13% and 15% over the next five years, according to a report by research company Frost & Sullivan.
It said increasing awareness of the benefits of telematics technology would fuel a surge in the general off-highway vehicle (OVH) telematics market.
The construction and industrial segments were expected to grow “considerably”, while momentum was also said to be building in the agricultural sector.
The report said 107100 OHV vehicles installed telematics in 2013 – a figure projected to increase to 135000 by 2015, due to the entry of rental equipment companies into the telematics market.
Frost & Sullivan automotive and transportation research analyst Gokulnath Raghavan said, "Overall awareness on OHV telematics has increased significantly in recent years and these technologies are now perceived as the go-to solutions for improving the total cost of ownership.”
However, the report added that telematics penetration rates had yet not reached an optimal level, partly due to the lack of training programmes available, combined with the absence of return-on-investment justifications for heavy equipment fleet owners; and a lack of standardisation of OHV telematics.
The Association of Equipment Management Professionals (AEMP) and Association of Equipment Manufacturers (AEM) have begun to standardise OHV telematics and provide training.
Frost & Sullivan said the challenge to install telematics for mixed fleets would also be addressed as original equipment manufacturers were partnering with third-party vendors.
However, it added that drivers in favour of government regulations dictating safety and security requirements were lacking.
It said this, along with heavy equipment fleet owners' preference for basic rather than high-end telematics services, was slowing down the pace of market growth.
Mr Raghavan said, "Once heavy equipment fleet owners fully understand the real-time benefits of telematics, they will consider installing advanced solutions.
"If OHV telematics vendors ensure their products enable easy access to data and support heavy equipment fleet owners by advocating specific telematics solutions depending on the application segment, adoption rates will strengthen."
The Frost & Sullivan report is called Analysis of the North American Off-highway Vehicle (OHV) Telematics Market.