South Africa Telematics Market Posts 12% Growth Rate

South Africa's fleet telematics market showed growth in the fourth quarter of 2016, with active fleet management systems deployed in commercial vehicle fleets reaching an estimated 1.1 million.

The growth was observed in a report by IOT analyst firm Berg Insight, which said the number is expected to reach 1.9 million by 2021 and has a compound annual growth rate of 12.6%, the analyst firm said.

Increasing demand for surveillance and security for commercial vehicles are key drivers for exponential growth of the automotive fleet telematics aftermarket, the report also noted.

The market is dominated by a group of aftermarket telematics players, including Cartrack, MiX Telematics, Ctrack, Altech Netstar and Tracker. These companies represent as much as two-thirds of the total number of active fleet management systems in use in the country today, according to the report.

The new edition of Berg Insight's report on fleet management in South Africa for the first time includes an outlook on the overall African market.

The IOT research firm said Africa is a highly diverse geographic region from a fleet management perspective, and it can in general be divided into three sub-regions – South Africa, Sub-Saharan Africa, and Northern Africa.

The report points out the South African fleet telematics market is far ahead of the rest of the continent in terms of adoption, whereas Sub-Saharan Africa is the least developed region.

Berg Insight explains the African fleet management market beyond South Africa is by many industry representatives described as challenging – though certainly also promising – for several reasons. The recent weak economic environment and foreign exchange rate fluctuations in combination with the unstable political climate makes the market a challenging business environment overall, the report stated.