With the advent of MaaS, vehicle ownership is expected to decline, creating new opportunities in the smart transportation market through 2028

Overview of the Smart Transportation Market

During the years 2021-2026, the global market for smart transportation is expected to grow at a CAGR of 16.5%, bringing in $292.5 billion. V2V and V2G technologies are being developed as a result of an increasing urban population, various government regulations, and growing smart city initiatives (V2I). For instance, the Indian government provided $7.6 billion in funding over a five-year period from 2016 to 2021 for the development of smart infrastructure and management services under the smart city program. The smart transportation market is expected to benefit from these investments and initiatives. Increasing urban populations, an increase in traffic, accidents, and incidents, as well as the rapid modernization of vehicles, are all factors contributing to the growth of the global market for intelligent transportation systems. The market for smart transportation is expected to advance as a result of the increasing use of road safety technologies over the past decade. It’s only fair that governments address the “cost-of-loss” associated with human lives lost and infrastructure damaged by car accidents.

The following are the most important takeaways.

The smart transportation market in Asia-Pacific is growing at the fastest rate in the world because of government efforts to develop smart city solutions in this region.
Technology advancements like Vehicle-to-Vehicle (V2V) and V2I infrastructure (Vehicle-to-Grid) are transforming transportation systems, according to a Smart transportation market analysis.
Because of their sensors and ability to regulate traffic flow by reducing congestion, smart traffic management systems have the largest share of the market share in smart transportation.
Accenture PLC, International Business Machine (IBM) Corporation, Kapsch, Alstom, SA; Cisco System, Inc., and General Electric Company are some of the major players in the Smart Transportation market outlook (GE).

Smart Transportation Market

Analysis of the Smart Transportation Market by Type

The Smart Transportation Market is dominated by roadways. Approximately 26% of global emissions are attributed to the transportation sector, according to a 2019 report from the US Environmental Protection Agency. Reducing carbon emissions from transportation while also improving environmental safety can be accomplished by utilizing cutting-edge transportation technologies such as compressed natural gas, intelligent fuels, and wirelessly connected vehicles. Over the next few years, the railway sector is expected to grow at the fastest rate. As it moves millions of tonnes of goods and people every year, smart rail infrastructure and technologies are becoming increasingly important. There are also initiatives and regulations being implemented by governments around the world for the development of an intelligent rail system. A total of $28 billion has been invested by the Chinese government in various PPP projects for the implementation of smart railways in China.

Segmentation of the Smart Transportation Market Based on Applications

During the forecast period of 2021-2026, the CAGR for smart traffic management solutions is expected to be the highest at 20.2 percent. Smart traffic management is becoming more popular in various countries because of the increasing traffic congestion, pollution, and accidents. A smart city traffic management solution known as DiDi Smart Transportation Brain was launched by Didi Chuxing and Chinese traffic management authorities in January 2019 to promote the transformation and upgrading of the taxi and bus industries, as well as to help cities develop sustainable smart transportation ecosystems. In 2018, the Indian government approved $8.9 billion in funding for the use of artificial intelligence to decongest traffic and monitor violations. Technology like this is likely to speed up the market for smart transportation.

By Region: Smart Transportation Market Segmentation

For the year 2020, North America is expected to hold a commanding 34.2 percent of the global smart transportation market share. This is due to the rapid adoption of smart transportation solutions that provide features such as real-time traffic information as well as parking management and signalling systems as well as electronic toll collection. For example, the US Department of Transportation invested $160 billion in smart cities solutions in 2016. The goal of these initiatives is to improve parking and traffic management, which will in turn spur the development of a market for smart transportation. Asia Pacific, on the other hand, is the fastest-growing market for smart transportation. Countries like China and India have a significant impact on the economy of APAC. Several smart city initiatives are being implemented by the governments of these countries. India, for example, plans to spend $250 billion on smart city development this year. Furthermore, by 2023, it is expected that China’s investments in smart cities will total $38,92 billion. Smart city development will be enforced as a result of these investments, opening up new opportunities for the smart transportation market.

Challenges Facing the Smart Transportation Market

Improvements to the Roads and Bridges

Smart transportation market growth is being stifled by the need to upgrade the infrastructure of the current transportation industry. China, for example, spends $551 million a year on Intelligent Transportation Systems (ITS). Improvement of existing roads or rail projects requires a long time period which further increases the resource and cost of the project. Similarly, underdeveloped countries’ lack of internet penetration and the complexity of advanced transportation pricing systems necessitate additional heavy investment in supporting infrastructure for smart transportation.

The landscape of the Smart Transportation Market

Players in the Smart Transportation market employ a variety of strategies, including technological advancements and acquisitions. More than half of the Smart Transportation market’s revenue will be generated by just five companies by 2020. Accenture PLC, IBM, Kapsch, Alstom, SA, Cisco System, Inc., and General Electric Company are among the top ten companies in Smart Transportation (GE).

Acquisitions/Debuts of New Technology

Cisco and Dimension Data announced a new co-innovation agreement in April 2019 to develop a deeper collaboration environment and framework to jointly solve the business needs of clients.
Siemens’ smart transportation product line was upgraded in March of this year. According to the company, the new eHighway system is twice as efficient as conventional internal combustion engines. An overhead contact line provides trucks with power for this Siemens Mobility innovation.

The COVID-19 Pandemic Is Expected to Accelerate the Use of IoT for Travel.

This year, the world was hit by the COVID-19 pandemic, which spread quickly across all sectors. There are also travel bans and lockdowns in several regions to prevent the virus from spreading further. As a result, the travel and transportation industry suffered. Data-driven decision-making is increasingly being used by travel companies to improve their services and win back the trust of passengers. As a result, smart transportation services are being adopted at an accelerated rate.

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