The GSMA has issued research that details the disruptive impact embedded mobile technology will have on the automobile industry, helping to create a connected car market worth almost €40 billion globally in 2018, up from €13 billion in 2012.
According to research firm SBD, 83% (€32.6 billion) of total the connected car market revenue in 2018 will be driven by the growth of embedding SIM technology into new vehicles to enable mobile connectivity.
This will encourage a range of mobile-based services around safety, security, infotainment, traffic information, navigation and vehicle diagnostics.
SBD predicts that most, if not all, new cars will have some form of connectivity by 2025, due largely to the rapid growth of embedded mobile technology.
“Embedding mobile technology in cars will not only save lives, but also drive a range of new services and provide a significant revenue opportunity for the mobile and automotive industries,” said Michael O’Hara, Chief Marketing Officer, GSMA.
“The rapid growth of this market will be driven in part by positive regulatory action, particularly in Europe and in emerging markets such as Russia and Brazil. We are in the midst of a connected car revolution and it is vital that the mobile and automotive industries work together to deliver scalable and pervasive connected experiences and ensure this market reaches its potential.”
Sales of new cars are expected to reach more than 100 million globally by 2018, more than 35 million of which will be shipped with embedded mobile technology, representing a 31 percent penetration rate and far outstripping growth of alternative connectivity means.
By contrast, 21 million cars will be fitted with smartphone integration (18%) and just 10 million with tethered solutions (9%). The rapid growth of the connected car market will result in associated revenues three times larger in 2018 than in 2012,the GSMA said.
With greater demand for new cars in emerging nations, legislative action in the BRIC countries (Brazil, Russia, India and China) will also be pivotal drivers of the connected car market.
Regulators in Russia are set to deploy legislation for new cars and trucks to ship with embedded mobile systems that will alert the emergency services in the event of an accident.
Sales of cars with embedded connectivity should also be boosted by regulation in Brazil that stipulates that all new vehicles are equipped with stolen vehicle tracking systems.
“The growth of the connected car market is also being aided by key initiatives such as the GSMA’s Connected Car Forum, where leading mobile operators and automakers come together to overcome barriers to growth and to improve the speed and uptake of telematics and infotainment services,” said O’Hara.
“As a result, not only will mobile operators play a major role in connecting all new cars by 2025, they are also well positioned to move further up the value chain and provide innovative value added services to their customers.”