FLEET MANAGEMENT IN CHINA  SUMMARY  1 STRATEGIC RESEARCH SERIES  M2M RESEARCH SERIES Summary

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Fleet management (FM) is an ambiguous term used in reference to a wide range of solutions

for different vehicle-related applications. Berg Insight’s definition of a fleet management

solution is a vehicle-based system that incorporates data logging, satellite positioning and

data communication to a backoffice application. The history of fleet management solutions

goes back several decades. On-board vehicle computers first emerged in the 1980s and were

soon connected to various satellite and terrestrial wireless networks. Today, mobile networks

can provide ubiquitous online connectivity in many regions at a reasonable cost and mobile

computing technology delivers very high performance, as well as excellent usability. All of

these components combined enable the delivery of vehicle management, transport

management, driver management and mobile workforce management applications linking

vehicles and enterprise IT systems.

Commercial vehicle fleets play an essential role in the Chinese economy and are crucial for

the development of the country. Road transport represents around 75 percent of the total

goods transports on the Chinese market measured by weight, corresponding to almost 31

billion tonnes in 2013. The total ownership of trucks in China reached almost 17.9 million

vehicles in 2011 according to official statistics. Around 2.5 million buses are moreover

estimated to be in operation in the country.

Berg Insight is of the opinion that the Chinese fleet management market will experience steep

growth in the next coming years. The development is boosted by a combination of political

decisions to track selected trucks and buses and the explosion of e-commerce which forces

logistics companies to improve the fleet management efficiency and customer service by

enabling tracking of goods status information. National, provincial and regional initiatives to

reduce pollution in the transport sector are moreover expected to speed up the renewal of the

operating fleet of trucks and buses. This development along with increasing factory-fitting of

telematics platforms together foster increased FM adoption on the Chinese market. The

SUMMARY  FLEET MANAGEMENT IN CHINA

2

STRATGIC ESEARCH SERIES  M2M RESEARCH SERIES

number of fleet management systems in active use is forecasted to grow at a compound

annual growth rate of 22.9 percent from 2.1 million units at the end of 2014 to 5.9 million by

2019. The penetration rate in the total population of registered commercial vehicles including

trucks and buses is estimated to increase from 9.0 percent in 2014 to reach 19.8 percent in

2019. Track & trace systems dominate the market and the installed base so far includes a

notable share of low-end systems with comparatively limited functionality.

The Chinese fleet management market includes numerous players that have installed tens of

thousands of telematics systems for fleet clients. Top providers with installed bases of more

than 100,000 units include 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. Also a small number of international aftermarket solution providers

have entered the Chinese fleet management market but the installed bases of the foreign

providers remain limited. 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.

Some Chinese commercial vehicle OEMs have introduced telematics systems. In the truck

segment, a small number of OEMs stand out as more prominent in terms of fleet telematics

activities – most notably Foton and Shaanxi Automobile Group. There are further a number of

telematics initiatives among the bus manufacturers from players such as Yutong and King

Long Group. The latter is also known as the Three Dragons and includes the brands King

Long, Golden Dragon and Higer. Multiple telematics offerings have been launched within the

group. Also a number of other truck and bus manufacturers are exploring opportunities

related to fleet telematics, but many OEMs still have little or no activity in this space. The

automotive industry players on the Chinese market are in the future expected to increasingly

equip new commercial vehicles with telematics systems in line with government initiatives.


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