Telematics in Brazil, Russia, India & China
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Hughes Telematics, Inc. Proprietary & Confidential Telematics in Brazil Russia India China Telematics Update Munich November 2009
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Michael Sena, Vice president – European Development for Hughes Telematics, spoke really well on the emerging markets of Brazil, India, China and Russia at Telematics Munich 2009 Conference & Exhibition.
Transcript of Telematics in Brazil, Russia, India & China
Hughes Telematics, Inc. Proprietary & Confidential
Telematics in BrazilRussiaIndiaChina
Telematics Update MunichNovember 2009
Telematics in the BRIC Countries
Brazil
India
China
Russia
The term BRIC is an acronym coined in 2001 in a report by Goldman Sachs. It refers to the emerging economies of Brazil, Russia, India and China, which , in 2001, were viewed as the titans of the future.
Telematics in the BRIC Countries
Hughes Telematics, Inc. Proprietary & Confidential
GovernmentSingle party communist state - Dictatorship
Population 1.35 billion
Area 9.64 million km2
Pop. density 140/km2
GDP per capita $3259
Languages 7 (Standard Mandarin)
Drives on Right (except Hong Kong and Macau)
In 2008, The People’s Republic of China became the second largest producer of motor vehicles, following Japan and ahead of the United States. Nanjing Auto bought Rover in 2006, and Geely is lining up to buy Volvo from Ford.
Telematics in the BRIC Countries
Telematics in the BRIC Countries
Hughes Telematics, Inc. Proprietary & Confidential
India ‘s TaTa Motors purchased Jaguar and Land Rover in the spring of 2008 for $2.9 billion. Ford had bought both companies (Jaguar in 1990 and Land Rover in 2000) for a combined total of $5.23 billion). TaTa has taken loans to keep JLR afloat.
GovernmentFederal Republic, parliamentary democracy
Population 1.2 billion
Area 3.29 million km2
Pop. density 364/km2
GDP per capita $2,780
Languages Hindi/English
Drives on Left
Hughes Telematics, Inc. Proprietary & Confidential
Brazil was the sixth largest car and truck producer in the world in 2008, just behind South Korea and ahead of France. In 2007, the government issued a game changing edict (Res. 245/07): all new cars would have a tracking systems installed by 1 February 2011.Government
Federal Republic, presidential democracy
Population 191 million
Area 8.51 million km2
Pop. density 22/km2
GDP per capita $3,295
Languages Portuguese (13 indigenous)
Drives on Right
Hughes Telematics, Inc. Proprietary & Confidential
Russia ‘s GAZ was poised to take over control of Opel/Vauxhall from GM when the GM board pulled the plug. This was symbolic of Russia’s current economic crisis. Following explosive growth from 2001 to 2008, the Russian juggernaut has crashed.
Government Federal semi-presidential republic
Population 142 million
Area 17.07 million km2
Pop. density 8.3/km2
GDP per capita $15,948
Languages 27 (Standard Russian)
Drives on Right
Telematics in the BRIC Countries
Implementation Criteria
1. Car Production Scale2. Vehicle Density3. Car Industry Sophistication4. Electronics Industry
Sophistication5. Telecommunications Coverage6. Emergency Services Coverage7. Enabling Government
Regulations8. Map Data Availability
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Telematics in the BRIC Countries
Implementation Criteria: 5
5. Telecommunications
1. Voice and Data Connectivity in 100% of country
2. Voice and Data in most cities and along major connecting roads
3. Voice and Data in major cities and along major roads
4. Voice only
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Telematics in the BRIC Countries
Comparison EU-15
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51. Production by domestic companies2. Vehicle Density3. Car Industry Sophistication4. Electronics Industry
Sophistication5. Telecommunications Coverage6. Emergency Services Coverage7. Enabling Government Regulations8. Map Data Availability
Telematics in the BRIC Countries
Example Russia
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1. Production by domestic companies Avtovaz and Gaz 25% of total
2. Vehicle Density 152/100 inhabitants (2007)
3. Domestic car industry is in sore need of upgrading
4. Electronics Industry Sophistication is reasonably good
5. Telecommunications Coverage is excellent in city regions.
6. Emergency services must be supplemented with private services
7. There are no enabling laws, but insurance requirements
8. Map Data Availability for positioning is good, but not for navigation.
Telematics in the BRIC Countries
Risk
Complexity
Growth
Automotive Pharmeceuticals
Risk - The degree to whichinvestments involve high risks.Risk averse companies, likethose in the automotive sector,invest in cost control andcompetitor information.Companies that are not riskaverse make large investmentsin shared infrastructure andprojects that attempt toachieve competitiveadvantage.
Growth - The degree to whichinvestments provide an opportunityto achieve significant growth.Companies in sectors that haveminimum or negative growth, suchas the automtive industry, invest inefforts to protect market share,while growth sectors, likepharmeceuticals and energyexploration, invest in expandingcapacity.
Complexity - The degree to which investments can increasecomplexity and create greater product differentiation. Companies inindustries that are highly complex can work in very narrow niches anddevelop new products that solve particular problems and satisfyspecific market needs. The automotive sector creates variations ofthe same product with the same basic performance objective. Thereis very little complexity. Investments are made in identifying whichfeatures that are introduced by competitors are likely to be requiredby the market.
A view of the automotive industry in the established markets—North America, EU-15 and Japan.
There is no or negative growth.
Cost control and close following of competitors is essential for survival.
Complexity is created to achieve differentiation.
Telematics in the BRIC Countries
Risk
Complexity
Growth
Automotive Pharmeceuticals
China, India and Brazil are growing vehicle markets and investments in expanding capacity are justified.
Russia, China, India and Brazil are all high risk countries for political, social and governmental reasons.
There is even less complexity in the BRICs, especially in China and India compared to EU-15, Japan and North America, so price is more important than features.
Telematics in the BRIC Countries
Country eCall bCall iCall Vehicle Tracking
Remote Diagnostic
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PPU Insurance
Remote Controls
Internet Connected Services
United States
Japan
Germany
China
India
Russia
Brazil
High DemandPotential
Low Demand
Telematics in the BRIC Countries
Proprietary & ConfidentialProprietary & Confidential
Thank you.
Telematics in BrazilRussiaIndiaChina
