According to ABI Research, commercial telematics subscriptions in the Middle East and Africa (MEA) region will grow from 1.82 million in 2015 to 4 million in 2020, at a CAGR of 17%. “With interest of fleet management suppliers in BRIC countries waning due to regulatory, cultural, or economic challenges, the Middle East and Africa is coming into focus as an alternative region for expansion. With economic growth fueled by human and natural resources in Africa and the oil and gas industry in the Middle East, opportunities exist to offer fleet management and asset tracking technologies in an increasing number of segments including people and goods transportation, construction, mining, and utilities,” says VP and Practice Director Dominique Bonte.
MiX Telematics, Mobiliz, and Arvento already aggressively target the MEA market with premium solutions from their established bases in South Africa and Turkey. However, for global providers such as Telogis, HERE, Geotab, Transics, TomTom Telematics, Astrata, and Pointer Telocation attempting to enter the MEA region, many challenges still remain. To be successful, companies need to develop deep relationships by establishing a local presence through acquisitions, partnerships or joint ventures with local players. Examples include TomTom Telematics’ partnership with Tracker and Pointer Telocation’s acquisition of Global Telematics.
Market education and awareness building are also critical for demonstrating the additional benefits of premium fleet management solutions and their positive impact on ROI while highlighting the differentiation against low cost offers in order to avoid aggressive price wars with local “track-and-trace” type players. Other issues include requirements for telematics providers in countries such as Oman to host their data in local servers, the not always transparent regulatory environment, and the lack of open market conditions.
Most importantly, navigating the widespread political instability and related security problems in the MEA region—with the UAE and South Africa as rare exceptions of structurally stable environments—requires relying heavily on knowledge and expertise from local partners.
These findings are part of ABI Research’s Commercial Telematics Market Research.
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