Optimizing the Flow of Vehicle and Pedestrian Traffic in Cities

By 2030, there will be more than 1.6 million signalized intersections across all regions. City governments are expected to modernize these intersections to optimize vehicle traffic flow and make their streets safer. Three urban traffic management technology forecasts ABI Research recently conducted include the traffic camera installed base, Light Detection and Ranging (LiDAR) sensors by smart city category, and traffic management system revenue. Below is a breakdown of each technology.

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Market Overview

  • By 2030, there will be more than 1.6 million signalized intersections across all regions. City governments are expected to modernize these intersections to optimize vehicle traffic flow and make their streets safer.
  • The total traffic camera installed base will be 6.2 million by 2027, which is 1.8 million more than the 2022 installed base.
  • Traffic management system revenue will reach US$4.9 billion by 2026 worldwide, which is US$1 billion more than the revenue generated in 2022.
  • Asia-Pacific, by far, sees the most in traffic management system revenue (US$2.2 billion in 2026), growing at a Compound Annual Growth Rate (CAGR) of 9.52% between 2021 and 2026. North America comes in second, growing at a CAGR of 1.36% and will generate more than US$1 billion in revenue in 2026.
  • LiDAR technology demand is expected to explode and the total installed base will grow at a CAGR of 88% between 2022 and 2027—amounting to the tune of 1.5 million.
  • Out of all smart city categories, traffic intersections are the most common application of LiDAR sensors, with a 34,000 installed base in 2022. By 2027, that number will expand to more than 1 million installations.

“While congestion has been back for a while, some fundamental changes are taking place, both in terms of a much more complex, multimodal traffic environment and new technologies driving traffic management innovation and efficiency.”  – Dominique Bonte, VP of End Markets at ABI Research


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Key Decision Items

Understand the Many Use Cases for Real-Time Traffic Management

By turning traffic lights into smart systems, city governments and road operators can make data-driven conclusions about traffic flow optimization. Further, sensors, like LiDAR sensors, collect real-time traffic data and provide rich analytical insight that can be used for the safety and betterment of the public. For example, sensors can see how much traffic is approaching each side of an intersection and automatically choose which side to provide a green light for—reducing congestion and enhancing emergency vehicle flow. Or it may go beyond that, whereby multiple intersections work together to provide a “green wave.” Adaptive traffic light signaling only scratches the surface of the long list of applications of real-time traffic management for city governments.

Real-time traffic management solutions can also be used for:

  • Vehicle speed enforcement
  • Incident management
  • Traffic information services
  • Rail crossing monitoring
  • Tunnel monitoring
  • Dynamic and adaptable routing
  • Low Emissions Zones (LEZs)/sustainability
  • Curbside management

Combine LiDAR with Other Types of Sensors

To collect rich insights about activity at intersections, in tunnels, along freeways, and in other locations, fixed sensors should be deployed in the chosen area. Both LiDAR and High-Definition (HD) radar sensors can capture Time-of-Flight (ToF) measurements about vehicles and pedestrians when they illuminate an object with radio waves passed through a transmitter. Although the two technologies have similar features, LiDAR provides much more detailed imagery because it uses a lower wavelength than radar, resulting in better environmental accuracy.

While LiDAR offers some unique features that can’t be achieved with other sensors, such as being superior at eliminating false positives and false negatives, it is most effective when combined with other sensors, including camera, radar, mobile, and Far Infrared (FIR) sensors. Whether it’s for increased reliability or to provide a broader spectrum of applications, a multi-sensor approach is a common route that city planners are expected to take.

For example, LiDAR doesn’t support facial recognition, so it’s advisable to deploy camera sensors in security contexts that rely on biometrics, such as facial recognition and license plate recognition. As another example, mobile traffic management sensors, which are embedded in both vehicles and smartphones, compile real-time data that are critical to traffic data services like HERE, Google, and INRIX. Moreover, urban traffic engineers rely on the accuracy of these services to make informed decisions.

Leverage Historical Data and Simulation Software

The historical data that traffic management sensors capture gives urban planners a detailed look into how intersections can provide smoother operations and how the city can become more sustainable. Some of the data may reveal things like where accidents often occur or where congestion levels are too high. These data can then be used for advanced modeling and simulation—improving city designs for intersections, signal timing, etc.

A major aspect of urban planning is the use of digital twins, which enable city officials to simulate proposed changes before actually implementing them. Example use cases of urban digital twins include simulating the effects of adding additional transit lines or discerning the feasibility of car sharing and micromobility.

Pay Attention to the Edge, 5G, and V2X

Urban planners and technology suppliers must look at edge computing as an absolute necessity because real-time analytics via Artificial Intelligence (AI) and Deep Learning (DL) is the nucleus of traffic management. Edge computing is local-based, so it allows for an instantaneous response to potentially dangerous situations and can adapt traffic signal phases accordingly. 5G is a key enabler of Mobile-Access Edge Computing (MEC), as it enables devices to communicate in real time. Using this deployment, some processes can be offloaded to the cloud, saving on costs, supporting scalability, and reducing power consumption.

Vehicle-to-Everything (V2X) connectivity is going to be a common occurrence at intersections in the future. V2X enables communication from traffic management devices to nearby vehicles and pedestrians’ smartphones. If there’s a hazard, drivers and pedestrians are alerted immediately. V2X will also be integral to communicating signal phases to cars and enabling green waves.

Go beyond Vehicle Traffic Management

Pedestrian safety and crowd management have become major focus areas for city governments in recent years, especially in the wake of COVID-19. Smart city officials can use LiDAR and other sensor technologies for several crowd management use cases, such as monitoring the flow of pedestrian traffic and measuring people density. These solutions are useful for social distance monitoring and pedestrian flow management in city centers. Technology providers should focus on helping understand customer behavior to provide a better Customer Experience (CX) at airports, train stations, venues, malls, and other indoor locations.

Explore New Monetization Opportunities

The data collected by traffic management sensors not only support urban planning, but also present the opportunity for a brand new revenue stream. Beyond urban planners, insurance companies, retailers, and logistics service providers would all view traffic and pedestrian traffic data as highly valuable and pay a premium for access to the data. The data should be archived in an organized and compartmentalized way, allowing for easy access to the desired information. The exchange of data can take place through trading or on a reputable marketplace.

Moreover, technology suppliers and city governments should work together to create new traffic management services that can be monetized. For example, a delivery service company could pay a monthly fee for vehicle preemption services that enable the company to promise tighter delivery windows to customers.

Key Market Players to Watch

Dig Deeper for the Full Picture

To take a deeper dive into the technologies and innovators in the city traffic management space, download ABI Research’s Urban Vehicle Traffic and People Flow Management research analysis report.

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This content is part of the company’s Smart Urban Infrastructure Research Service.

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