Fleet Telematics: Mobile Resource Management Systems Market Overview

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The opening keynote session from Telematics Update's recent Fleet & Asset Management Conference & Exhibition USA 2009. Clem Driscoll of C.J. Driscoll Associates spoke on "Mobile Resource Management Systems Market Overview". To view the entire presentation, visit http://www.telematicsupdate.com/fleeteurope/reports.shtml

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Fleet Telematics: Mobile Resource Management Systems Market Overview

  1. 1. Mobile Resource Management Systems Market Overview Fleet & Asset Management USA 2009 November 18, 2009 Presented by C.J. Driscoll & Associates (www.cjdriscoll.com)
  2. 2. C.J. Driscoll & Associates <ul><li>Founded in 1993 </li></ul><ul><li>Marketing consulting and research on GPS and wireless products and services for both commercial and consumer markets </li></ul><ul><li>Industry reports and multi-client marketing research studies </li></ul><ul><ul><li>6 syndicated Commercial telematics/MRM studies (2003-09) </li></ul></ul><ul><ul><ul><li>Market trends/analysis/suppliers </li></ul></ul></ul><ul><ul><ul><li>Fleet operator interest in MRM solutions </li></ul></ul></ul><ul><ul><ul><li>Fleet operator use and satisfaction with MRM solutions </li></ul></ul></ul><ul><ul><ul><li>Fleet operator interest in trailer monitoring systems and services </li></ul></ul></ul><ul><li>Numerous private marketing research studies </li></ul><ul><ul><li>Market analysis and assessment </li></ul></ul><ul><ul><li>Focus groups </li></ul></ul><ul><ul><li>Telephone surveys </li></ul></ul><ul><ul><li>On-line surveys </li></ul></ul><ul><li>Strategic consulting, business plan development, M&A </li></ul><ul><li>Clients include most major MRM hardware, software and technology suppliers, as well as the leading cellular carriers and automotive manufacturers. </li></ul><ul><li>Research data quoted in the Wall Street Journal, Business Week, Fortune Magazine, USA Today and other leading publications. </li></ul>
  3. 3. C.J. Driscoll Partners <ul><li>Clem Driscoll </li></ul><ul><ul><li>Founder and Managing Partner of C.J. Driscoll & Associates </li></ul></ul><ul><ul><li>20+ years experience in GPS industry as a marketing executive, consultant and analyst </li></ul></ul><ul><li>Mark Licht </li></ul><ul><ul><li>Consulting partner in C.J. Driscoll & Associates and pioneer of the MRM and LBS industries </li></ul></ul><ul><ul><li>Co-founder and past president of Teletrac, one of the largest MRM suppliers </li></ul></ul>
  4. 4. 2009 Mobile Resource Management Systems Market Study <ul><li>3 rd edition of report released May 2009 </li></ul><ul><li>Often referred to as the “bible of the MRM industry” </li></ul><ul><li>304-page report analyzes: </li></ul><ul><ul><li>MRM market status and trends </li></ul></ul><ul><ul><li>MRM subscriber and revenue growth projections by segment </li></ul></ul><ul><li>Includes fleet market statistics and estimated MRM penetration for major fleet segments </li></ul><ul><li>160+ companies profiled </li></ul><ul><ul><li>Local and long haul fleet MRM system suppliers </li></ul></ul><ul><ul><li>Suppliers of MRM solutions utilizing GPS-equipped cellular phones and portable devices </li></ul></ul><ul><ul><li>Trailer monitoring system suppliers </li></ul></ul><ul><ul><li>Systems for monitoring heavy equipment and other high value assets </li></ul></ul><ul><li>Study is based on 120+ interviews conducted with MRM suppliers, wireless network operators, and other industry sources </li></ul>
  5. 5. Upcoming Reports - Latin American MRM Market Study - <ul><li>Scheduled for release in early 2010 </li></ul><ul><li>Issues covered will include: </li></ul><ul><ul><li>Addressable market by country </li></ul></ul><ul><ul><li>Market penetration </li></ul></ul><ul><ul><li>Market trends </li></ul></ul><ul><ul><li>Profiles of leading MRM suppliers by country, including market segments served, installed base, and typical pricing. </li></ul></ul>
  6. 6. U.S. MRM Market Status and Trends
  7. 7. U.S. MRM Addressable Market Estimates
  8. 8. U.S. MRM Market Today: 3.9 Million MRM Units in Service <ul><li>225,000+ companies using MRM systems and services </li></ul><ul><li>Total MRM market projected to grow from 3.9 million units in service EOY 2009 to 6.5 million units in service EOY 2012 </li></ul>
  9. 9. Local Fleet MRM Market <ul><li>In 2009, net subscriber growth has slowed to about 8% - 10% due to weak economy. </li></ul><ul><li>Churn has increased to an estimated 1.5% per month due to an increased number of small fleet operators experiencing financial problems. </li></ul><ul><li>In 2009, the bright spot in the market has been mid size and large fleets, many of which have continued to invest in technology to reduce operating costs. </li></ul><ul><li>Several leading local fleet MRM providers report strong 2009 subscriber and revenue growth. </li></ul><ul><ul><li>Some others report slower net growth in 2009 due to increased churn, limited budgets, and extended purchase decisions. </li></ul></ul><ul><li>Market remains fragmented, though some consolidation is occurring </li></ul>
  10. 10. Local Fleet MRM Market Trends <ul><li>Executive “dashboards” providing snapshot of fleet status and activity are “in”. </li></ul><ul><li>Increased availability of satellite imagery (3D view), through Google or other map providers </li></ul><ul><li>Many local fleet MRM solution providers have added a navigation/ dispatching option, mostly through integration with Garmin PNDs. </li></ul><ul><ul><li>PND also serves as a Mobile Data Terminal. </li></ul></ul><ul><li>Increased interest in monitoring driver behavior to reduce risk and fleet operating costs </li></ul><ul><li>In-vehicle equipment costs (GPRS/GPS) have continued to decline. </li></ul><ul><ul><li>Prices typically under $400 and, at times, under $300 </li></ul></ul><ul><li>Some downward pressure on monthly service fees due to difficult competitive environment </li></ul>
  11. 11. Local Fleet Installed MRM Market Growth (Units in Service) - Actual and Projected Market Growth - The local fleet installed MRM market was growing approximately 20% per year until this year, when the weak economy resulted in a slowing of market growth to about a 10% level. Increased market growth of 15% is projected for 2010 due to an improving economic climate.
  12. 12. Trucking Market <ul><li>Many trucking fleets are struggling </li></ul><ul><ul><li>Slow economy </li></ul></ul><ul><ul><li>Many trucks and trailers “parked” </li></ul></ul><ul><li>Truckload (TL) MRM market is mature </li></ul><ul><ul><li>As many replacement units as new customers </li></ul></ul><ul><ul><li>2009 net TL numbers will be flat </li></ul></ul><ul><li>Private delivery fleet MRM market growth is stronger than TL </li></ul><ul><ul><li>Less mature market </li></ul></ul><ul><li>Trailer monitoring systems market growing slower than projected </li></ul><ul><ul><li>About 20% growth in 2008 – down from peak of 30% to 40% growth 2005-07 </li></ul></ul><ul><ul><li>Very little net market growth in 2009 </li></ul></ul><ul><ul><li>Installed base approx. 580,000 units </li></ul></ul><ul><li>A major portion of the installed base is large fleets that use trailer monitoring solutions to keep track of the location of trailers to improve utilization. </li></ul><ul><li>Reefer monitoring market is relatively strong and commands higher price. </li></ul>
  13. 13. GPS-Enabled Handsets - Estimated MRM Subscriber Growth - Handset-based MRM solutions range from basic location tracking and time card management to sophisticated field service automation, scheduling, dispatch and routing applications. Handheld devices include basic GPS-equipped cell phones, smartphones, and ruggedized handheld computers. Many suppliers of Field Service Automation and Transportation and Logistics solutions have introduced GPS tracking using handheld devices to enhance their software solutions, and some have large numbers of units in service.
  14. 14. Heavy Equipment Monitoring <ul><ul><li>Estimated 160,000 Heavy Equipment Monitoring units currently in service, vs. 50,000 in late 2005. </li></ul></ul><ul><ul><li>Heavy equipment theft in U.S. estimated to exceed $1 billion a year. </li></ul></ul><ul><ul><li>Besides location, MRM systems monitor engine performance, hours of use, scheduled maintenance, and other parameters. </li></ul></ul><ul><ul><li>Market growth is escalating as most major OEMs are providing factory-installed MRM solutions and including approx. 3 years of free service. </li></ul></ul><ul><li>The range of heavy equipment with installed monitoring systems has grown to include cranes, generators, forklifts, and other categories. </li></ul><ul><li>Aftermarket is still active with several suppliers reporting about twice as many units in service as 2005. </li></ul><ul><li>The market for tracking a wide range of mobile assets is likely to grow with lower cost, battery-conserving technology. </li></ul>
  15. 15. Driscoll Top 10 MRM Suppliers - Based on Estimated Total Subscribers - Supplier Applications Equipment 9/05 11/09 *Xora acquired Gearworks in Aug. 2009 85,000 55,000 Installed CDMA/1xRTT cellular units Truckload, LTL and private trucking fleets PeopleNet Communications 100,000 10,000 Installed cellular GSM/GPRS and legacy SkyTel (Mobitex) units Local fleet tracking Networkfleet 150,000* 40,000 Mostly GPS-equipped cell phones; some installed units Monitor mobile workers Time/task management Xora 95,000 45,000 Installed cellular GSM/GPRS and proprietary network units Local fleet tracking Teletrac 80,000 35,000 Mostly GPS-equipped cell phones; some installed units Monitor mobile workers/navigation Time/task management TeleNav TeleNav Track 250,000 140,000 (@Road) 215,000 installed cellular-based units; 15,000 GPS cell phones Local fleet tracking, supply chain management Trimble/@Road 73,000 4,000 Installed cellular GSM/GPRS units Local fleet tracking FleetMatics 130,000 13,000 ORBCOMM satellite or CDMA cellular devices Trailer and container monitoring GE Equipment Services 200,000 42,000 MSV satellite communications Trailer and asset monitoring SkyBitz 490,000 370,000 Installed satellite and CDMA/1xRTT/Aeris cellular units Long haul and local trucks, trailers and heavy equipment QUALCOMM
  16. 16. Macro Trends Impacting the Future of MRM
  17. 17. Telematics Update <ul><li>To continue viewing the rest of the presentation please visit </li></ul><ul><li>http:// www.telematicsupdate.com/fleeteurope/reports.shtml </li></ul>

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