Berg Insights’ view on the future of vehicle based applications, what they loosely call “fleet management”  is very encouraging. Under the bracket “Fleet Management” they include all aspects of vehicle management, transport management, driver and mobile workforce solutions and applications linking vehicles to enterprise IT systems.

The prediction is that the European market for fleet management is entering a sustained growth phase that should deliver a compound annual growth rate (CAGR) of around 21% for the next five years. This would mean that the number of installed fleet management systems will grow from it’s current level of around 2 million to over 5 million by the end of 2015.

There seem to be a few factors driving this adoption. Health and safety initiatives have a part to play, as do asset tracking and security concerns. However the main factors identified by the research seems to be the cost reductions (in hardware and connectivity) that have really enabled the widespread adoption of fleet management services.

Berg also point to the notable consolidation trend that’s happening in the market as vehicle manufacturers and OEMs begin partnering with one another and with service providers to offer a comprehensive service approach. It’s something that’s been in the news recently when Spanish telecom giant Telefonica announced a partnership with fleet management company Masternaut . It looks like this might be the beginning of a trend as the major players look to take advantage of this market growth.