INDUSTRY ANALYSIS OF TRANSPORTATION

TELEMATICS - INTRODUCTION
Having established itself as an IT and ITES superpower in the global arena, India has registered robust growth in Telematics Industry as well. The Telematics market in India is in nascent stage, but is growing robustly owing to an increased use of the technology in fleet management, vehicle tracking , and transport navigational solutions. System integrators have been offering vehicle tracking and fleet management system since 2001 and since then it has registered tremendous growth. Further, with fast paced infrastructure development and substantial increase in the sale of commercial vehicles are also bolstering this evolving technology to gain momentum and create a positive impression on the end users business requirements. However the cardinal challenge in the seamless adaptability and accessibility of these location-based services remains with availability of high quality digital map data and Cost of the technology is key to the price sensitive Indian consumers.
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TARGET SEGMENTS
Private Public Transport Road Logistics Government Road 61% Transportation of freight cargo

Public Transportation

Railway
Freight Cars Rail 30% Marine Logistics Other 9%

Aviation

Logistics

INTRODUCTION
Over the years, road transport has become vital to the economic development and social integration of the country. Road transport has attained a dominant position within the transport sector and accounted for a share of 4.7 per cent in India's gross domestic product (GDP) in 2010-11. Easy accessibility, flexibility of operations, doorto-door service, reliability and the growing use of just in time strategies in manufacturing have contributed towards a steady increase in the modal share of road transport in the movement of both freight and passengers.
In a globalized world, an efficient road transportation system is vital for increasing productivity and enabling the country to compete effectively in the world market. A world class road transport system is essential for lending competitive edge to the economy. Sustained economic growth, increasing disposable income, and rising urbanization has led to rising demand for road transport and personalized mode of transport (cars and two-wheelers), in particular. This is reflected in high annual compound growth in vehicle population of 10 per cent during 2001-2011, which entails doubling of the country's vehicle fleet every 6 to 7 years.

Navigation and Location-Based Service

A navigation system guides the user to a chosen destination. It typically uses GPS technology to acquire the users current position and then directs him to his destination via a map display or via voice prompts. Location based Service (LBS) comprise the group of applications that use positioning to add value to a service. often on a portable device.

In Car Infotainment

In -Vehicle Infotainment refers to the digital application for the car using mobile and/or onboard devices. Included are communication, satellite radio services, navigation, location based services, entertainment and internet connectivity.

Intelligent Vehicle Safety

Intelligent Vehicle Safety (IVS) applications are those that helps to prevent collisions, or help to reduce the severity of collision itself and the consequent damage and/or injury, by monitoring the local and the wider driving environment.

Fleet Management

Commercial Vehicle Telematics (CVT) is the technology behind real time fleet management system. Data is transmitted from the vehicle to back-office management systems and/or third parties such as 3PL, Shippers, customers or insurance companies.
Asset monitoring as the group of applications that transform information from an asset (Vehicle, Cargo) to a control response center. This can be for maintenance purposes, exception handling, billing stolen vehicles recovery etc.

Asset Monitoring

Risk Management

Telematics-enabled risk management is a specific area of commercial vehicle telematics that help insurance companies reduce their costs related to fraud and claims investigation.

Market Opportunity

The Indian Logistics market is expected to reach Euro 90 Bn by 2014 with a CAGR of ~10 % & transportation will account to 62% of this market
Indian 3PL market is expected to grow at around 20 percent per annum in the next 35 years The Intelligent Transport Systems (ITS) Market in India is estimated to reach Euro 0.375 Bn by 2015 growing with a CAGR of 5 to 10 % Vehicle tracking and fleet management segment of the telematics market in India earned estimated revenues Euro 61 Mn in 2011-12 and said to reach Euro 400 Mn by 2015-16

It is estimated that only 15 to 20 % of the fleets utilize telematics in India

The Indian commercial vehicle market will double to 1.6 million units in the period between 2012- 2017

MARKET SHARE OF TELEMATICS

Market Share
Dhanus Technologies 11% Others 8% TMT 22% E Logistics 11% Ashok Leyland 6%

Arya Om nitalk 14% Bio enable Technologies 5.60%

The current market of installed telematics devices is approximately 40,000 Units on Commercial Vehicles. However, currently only 20,000 of these units are operational.

TELEMATICS DEVICE REVENUES

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Revenues (USD Millions)

10 8
7.2 8.5 5.7 6.2

10.3

6
5.3

2
0 2008 2009 2010 2011 2012 2013

The revenues from Telematics device are expected to increase from USD 5.3 million in 2008 to USD 10.3 million in 2013
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STRENGTHS
Fast product development cycle times Quicker development of cash ow Internet based connection with developers Proliferation of handheld devices Closer connection to customers Large population of potential users

WEAKNESSES
Restrictions to information access by OEMs Resistance to change by service providers Individual product branding makes user aggregation tougher than vehicle branding by OEMs Smaller companies may have harder time building telematics partnerships

SWOT
OPPORTUNITIES
Group products, services and companies together to provide monitored telematics offerings Adapt European and Asian products to USA applications Position cell phones as information transfer devices

THREATS
OEMs further restrict access to information in an effort to tie customers to dealers Telephone companies raise price of communication frequency access New communication technology obsoletes your current platform NHTSA pushes for driver distraction legislation

Partner with ERP providers on eet management Work with NHTSA, EPA and CARB to develop aftermarket information pipeline Growing population of digitally literate new car buyers Pass Right to Repair legislation

Demand Analysis

Growth in International & Domestic Trade

Globalization of Manufacturing Systems

Investment in Transportation Infrastructure

DEMAND DRIVERS

Growth in Organized
Retail

Growth of 3PL, 4PL

Growth of MNCs

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% Total

2 Wheelers 72%

Cars 14%

Others 8% Buses 1% Goods Vehicle 5%

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Registered Motor Vehicles in India: 2000-2011

100,000
90,000 80,000 70,000 60,000 50,000 40,000 30,000 1,527 6,432 11,080 2010 17,109 1,527 6,432 11,080 91,598 20,000 9,451 8,599 11,526 12,649 13,950 15,313 17,109 34,118 41,581 47,519 51,922 64,743 75,336 82,402 91,598 38,556 10,320 58,799 69,129 6,143 562 2,715 5,319 2000 6,143 562 2,715 5,319 34,118 2001 7,058 634 2,948 5,795 38,556 635 2,974 6,121 634 2,948 5,795 2002 7,613 635 2,974 6,121 41,581 721 3,492 6,676 2003 8,599 721 3,492 6,676 47,519 768 3,749 6,828 2004 9,451 768 3,749 6,828 51,922 892 4,031 7,457 2005 10,320 892 4,031 7,457 58,799 992 4,436 7,921 2006 11,526 992 4,436 7,921 64,743 1,350 5,119 8,460 2007 12,649 1,350 5,119 8,460 69,129 1,427 5,601 9,039 2008 13,950 1,427 5,601 9,039 75,336 1,486 6,041 9,710 2009 15,313 1,486 6,041 9,710 82,402 7,058

10,000 0

Cars & Taxis

Buses Goods Vehicles Others Two Wheelers

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7,613

FLEET HELD BY SRTUs

Punjab 1.40% Others 1.30% West Bengal 1.80%

Maharashtra 19.00%

Andhra Pradesh 17.80%

Tamil Nadu 16.20%

Karnataka 17.40% SRTUs During 2010-11

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COST ANALYSIS OF SRTUs

Other 5.30%

Interest 6.60% Spares & Materials 2.30%

Staff 40.00%

Fuel & Lubricants 31.20%

Performance of State Road Transport Undertakings (2010-11)

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COMPETITION SCENARIO

1. Magneti marelli 2. Applied Electro Magnetics

3. Harman
4. Map My India 5. Automotive Infotronics (AL +Conti JV) 6. Tata Fleet Management 7. Volvo Fleet Management 8. Itrack 9. Mahindra Telematics

10. Delphi IBM

11. CMC Limited
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REVENUE MODELS

Revenue Models

License

Maintenance

Service

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