The Fleet Telematics Systems industry has experienced significant growth until the end of 2023, driven by the manufacture of devices and development of service software for tracking the location and characteristics of fleet vehicles. The industry's revenue is closely tied to demand from its key downstream market, truck transportation, as well as trade flows and the taxi and limousine industry. However, volatile fuel prices can impact revenue, especially during periods of reduced demand in key markets, as seen during the COVID-19 pandemic.

Despite the challenges faced during the pandemic, the industry is expected to regain momentum as the economy recovers. The revenue for Fleet Telematics Systems has been growing at a Compound Annual Growth Rate (CAGR) of 5.0% over the past five years, reaching an estimated $8.3 billion in 2023, with a projected increase of 0.7%. This growth is attributed to falling purchase fees, indicating improved profitability.

Manufacturers in the fleet telematics systems industry primarily focus on software servicing and development, with hardware manufacturing outsourced overseas to reduce wage costs. The adoption of the software-as-a-service (SaaS) distribution model, offering fleet data and analysis for a subscription fee, has become popular, driven by the increasing use of mobile devices. The industry has expanded its reach to various markets, including small local trucking companies, commercial vehicle fleet owners, and heavy equipment owners.

However, as new markets continue to emerge, attracting more manufacturers to the industry, there are concerns about limiting profitability growth and increasing competition, which may result in price pressure. The industry is expected to continue its growth, with a projected CAGR of 1.6%, reaching $9.0 billion over the five years to 2028. Factors driving this growth include the expanding trucking sector, increased use of mobile devices, stricter emissions and worker safety regulations, and the introduction of new products and markets.

The demand for fleet telematics systems is expected to be fueled by the aging US vehicle fleet, as fleet owners seek ways to reduce fuel costs without the expense of retrofitting or reoutfitting their entire fleets with more fuel-efficient vehicles. Overall, the industry is poised for sustained growth, driven by various factors contributing to increased demand and adoption of fleet telematics systems in the coming years.