The installed base of off-highway vehicle telematics systems will reach 16.1 million units worldwide by 2028

Berg Insight’s definition of the off-highway vehicle market includes various equipment such as specialised heavy machinery, lighter equipment and other vehicles used in the construction, mining, agriculture and forestry sectors. Off-highway vehicle telematics refers to telematics hardware and associated software solutions deployed for remote monitoring and management of fleets of machinery and equipment used in these sectors. Early initiatives among the heavy equipment OEMs started to emerge already in the 1990s and many manufacturers followed suit in the 2000s. Today, most equipment manufacturers have introduced some type of telematics offerings for their customers, either as a result of in-house development or through collaborative efforts involving third-party technology partners powering telematics solutions commonly under the OEMs’ brands. A wide range of aftermarket solution providers have entered the off-highway vehicle telematics space, offering solutions for various assets including multi-brand equipment fleets and commonly also other types of mobile and stationary equipment and vehicles. Solutions available on the market enable the delivery of vehicle management, operator management and safety management applications linking off-highway machines and enterprise IT systems.

Berg Insight estimates that the global installed base of active off-highway vehicle telematics systems reached 8.8 million units in 2023. This includes connected units deployed on various off-highway vehicles across the construction, mining, agriculture and forestry sectors. The construction sector accounts for the largest share, driven by OEM telematics systems offered by heavy equipment manufacturers. Agriculture and mining are the second and third largest sectors in terms of the number of connected units deployed on machines and vehicles used in agricultural and mining operations respectively. The remainder is represented by the forestry sector including telematics systems fitted to various forestry equipment. Growing at a compound annual growth rate (CAGR) of 12.9 percent, the active installed base of off-highway vehicle telematics systems across all sectors is forecasted to reach 16.1 million units worldwide in 2028. The North American market is estimated to be somewhat larger than the European. The Rest of the World is moreover estimated to represent more than half of the global installed base of off-highway vehicle telematics systems.

The top ten equipment manufacturers offering telematics together account for around 70 percent of the total number of off-highway vehicle telematics systems in use across the construction, mining, agriculture and forestry sectors globally. Berg Insight ranks Caterpillar as the leading off-highway vehicle telematics provider. Caterpillar was the first to surpass the milestone of 1.0 million connected assets across all segments and the company now has more than 1.5 million units. The runners-up are Komatsu and SANY. Other major manufacturers with several hundred thousand active units include Deere & Company, Volvo Construction Equipment, XCMG, Zoomlion, Hitachi Construction Machinery and JCB. HD Hyundai, CNH Industrial and Doosan Bobcat are also estimated to have reached the milestone of 100,000 units. Additional players having estimated installed bases of off-highway vehicle telematics units in the tens of thousands include AGCO, Liebherr, Terex, JLG Industries, CLAAS Group and Tadano.

The aftermarket for off-highway vehicle telematics is expected to shrink as the equipment manufacturers continue to introduce standard fitment on additional machine models and simultaneously increase the length of free software subscriptions. Arguments such as the OEMs’ weak spot being the inability to adequately serve the needs of mixed multi-brand fleets are becoming less valid thanks to initiatives such as the AEMP telematics standard which makes it possible to collect data from different brands and manage it all from a software interface of choice. There are however promising opportunities for telematics players that partner with the OEMs, either as end-to-end full-service providers or – in many cases maybe more realistically – working alongside OEM personnel to optimise the telematics functionality. In addition to the standard-fitted systems and time-limited subscriptions commonly included for free, the telematics players can also benefit from the upselling of more advanced functionality. There are several notable examples of partner-powered and co-developed offerings in the equipment OEM telematics space. In line with trends in adjacent markets such as fleet management for commercial vehicles, the partner strategy may grow in popularity among the equipment manufacturers at the expense of in-house telematics development efforts. This can especially be the case for equipment manufacturers that do not currently offer OEM telematics to their customers. The future development path is however far from certain as there are also numerous examples of OEMs moving from partner-powered to in-house developed telematics offerings in recent years. An increasing number of players such as vendors focused on on-road commercial vehicle fleet management are nevertheless expected to diversify into telematics for various off-highway vehicles and stationary objects. This enables fleets to monitor and manage all of their business-critical assets through the same backoffice interface, using familiar applications and reporting tools. Asset tracking, especially for smaller and lower-value items, represents a heavily underpenetrated market with considerable potential for telematics providers that are ready to diversify their product offering. Particularly strong growth is expected for solutions that also enable tracking of ancillary equipment such as attachments, implements, handheld tools and similar items.