Over the past decade, the number of connected vehicles on roads across Asia Pacific has increased significantly. Various factors have contributed to this rise, including the growing demand for in-vehicle connectivity and infotainment features among consumers. Automakers have also increasingly embraced telematics technologies to digitize the driving experience, enhance safety, and enable new services.
China in particular has emerged as one of the largest for connected cars. Several Chinese automakers now offer telematics as either standard or optional features on many new models. Various government initiatives have encouraged the proliferation of technologies like e-call for emergency response. Ride-hailing giant Didi also installed telematics devices in millions of vehicles on its platform to leverage location data and driver behavior analytics.
Other major APAC Automotive Telematics countries with sizable connected vehicle adoption include Japan, South Korea, and India. For example, over 60% of new cars sold in Japan last year had embedded connectivity. Leading automakers have partnered with telecom operators on solutions tailored for local needs and regulations. The rapid growth of 4G networks and fall in data prices have further spurred the connected car revolution across urban areas.
Emerging Opportunities in Automotive Telematics Services
As vehicle connectivity becomes mainstream, new business opportunities are emerging in the telematics services domain. There is growing demand from both automakers and drivers for value-added offerings that enhance the ownership experience. Services around safety, infotainment, fleet/asset management, predictive maintenance, and usage-based insurance are gaining traction.
In China, players like Baidu have launched open telematics platforms and app stores that allow third-party developers to create new in-car apps. This is enabling an ecosystem of services for areas like freight and logistics, ride-hailing, food delivery, and more. Automakers are also adopting the same model and expanding their presence in China's digital auto services sector.
Other major like Japan and South Korea have witnessed the proliferation of services around predictive maintenance, remote diagnostics, and over-the-air firmware updates. These deliver significant cost benefits to fleet operators by improving asset utilization and reducing downtime. Telematics is also finding increased usage in managing shared mobility fleets across dense Asian cities.
Regulatory Tailwinds and New Partnerships Driving Growth
Government safety regulations and policies have accelerated telematics adoption in APAC. China recently mandated the installation of e-call systems in certain new models. India has floated a similar proposal for new private vehicles. Japan has set targets for advanced driver-assistance systems and automatic emergency braking.
These developments are encouraging both international and domestic players to strengthen local partnerships and investments. For instance, Canadian telematics giant Telic acquired a China-based provider to expand offerings for local OEMs and fleets. Israeli startup Anthropic also partnered with Japanese automakers to develop AI-powered features for their Asia-focused connected vehicle programs.
Leading connectivity firms have also formed strategic collaborations with telecom operators. Verizon Ventures invested in China-based automotive tech developer Cohda Wireless to build out private 5G networks for transportation. Korean operator KT joined hands with German automaker BMW to conduct 5G trials for autonomous driving services on local roads.
Connectivity infrastructure build-out and fragmented regulations continue to pose near-term challenges, the APAC automotive telematics industry is expected witness double-digit growth over the next 5 years. Strategic partnerships and localized offerings will play a key role in helping established global players and local providers tap new revenue pools opening up across this dynamic region.
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