Telematics in China ~ How many players are too many?
In the last 4 years, the number of OEMs offering telematics services in China
has exploded, surpassing mature markets such as Europe and USA where
telematics took 15 years to become a commonly offered feature. In parallel to
this, the number of companies scrambling to support OEMs with their telematics
plans has also expanded. But is this intense level of competition good or bad
for the industry?
Typically, competition in any market is perceived to be a positive sign of a
healthy industry, leading to lower costs and greater innovation. In China,
competition within the telematics industry has grown at a much faster pace
compared to other markets, as service providers, content providers and
hardware suppliers all battle for a slice of the telematics pie. The problem
is that the pie remains relatively small.
As shown below, the number of players with contracts to support OE telematics
services in China has now surpassed 70, far exceeding the number of players in
Europe and the USA.
This is despite the fact that 2012 sales figures for connected cars in China
are significantly smaller than the USA and Europe. The market in China will
surely grow, but the current fragmentation within the value chain may hold the
industry back from growing as the relatively small revenues are spread thinly
across a large group of players.
A first step to addressing this problem is to understand who the key players
are within the telematics value chain and what capabilities they can provide
to vehicle manufacturers. For this reason SBD have just released the first
comprehensive value chain database for telematics in China, outlining all of
the key players, explaining what they do and even providing contact
information. Whether you're looking for fuel information, App developers or
TCU suppliers, this database provides an easy-to-use overview of who you
should be contacting.
Understanding who does what in a complex market like China is a key step to
choosing the right partners and launching successful services.
SBD's China Telematics Value Chain Database includes 150 companies and
allows users to easily identify the top players. In addition to providing
contact information for most of the companies, this tool allows users to see
which of them have experience of supplying various services and hardware to
About the author
Victor Zhang joined SBD in 2011. His research focuses on telematics and
security in China. Victor monitors the Chinese market closely for SBD.