A total of 2.62 million passenger cars were titled in Brazil in 2010—up 7 percent over 2009, according to IHS iSuppli research. Imported vehicles also enjoyed a banner year in 2010 with 657,000 light vehicles brought into the country, representing a 20 percent jump from the earlier year. Such growth in the Brazilian automotive industry has created an emerging market for telematics as more vehicle owners express concerns about requiring vehicular protection against violence and theft.
According to InfoGPS magazine, about 1 percent of the total fleet of 35 million vehicles—including passenger cars, vans, light trucks and approximately 10 million motorcycles—are stolen every year in Brazil. As a result of the high level of vehicle theft and break-ins, a large vehicle tracking market has been created. Here, Brazil’s Department of Transit National Transit Council (CONTRAN) has been working in the past few years to develop a stolen-vehicle tracking telematics system, in which both factory-installed telematics from original equipment manufacturers (OEM) as well as aftermarket device and service providers are set to grow significantly.
OEM Telematics
Given the two mandates—SINIAV and SIMRAV—that have been proposed and enacted, automakers in Brazil have begun to invest time, energy and resources into the development of telematics solutions along with relevant partners like wireless operators and telematics services providers (TSP). Volvo Cars is the first OEM in Brazil to offer embedded telematics services that address all the demands for the implementation of the mandatory tracking and immobilization device.
Monitored in real time via GPS and cellular connections, all new Volvo cars are factory equipped with standard telematics modules and a two-button “SOS” and “On Call” overhead console. Volvo On Call is free for the first two years and includes Automatic Crash Notification, Breakdown Call and remote services, such as fuel-level status and Remote Door Lock/Unlock. After the free bundle, customers will have to pay a “small fee” for the service. Volvo On Call is already present in 15 countries, but Brazil is the very first to receive Volvo’s embedded telematics solution outside of Europe.
Although Volvo is the first OEM to offer telematics services, many other OEMs are currently working on the development of telematics solutions in the Brazilian market. IHS expects that a number of these will be ready for market entry in the coming year.
Aftermarket Telematics; a Clear Need for Tracking Solutions
While still in their early stage, telematics services already are being enjoyed by Brazilian consumers through devices via the aftermarket. Furthermore, the numerous companies in the tracking and monitoring business that previously were only selling hardware are now looking into becoming certified providers of services such as WirelessCar.
Tracking solutions are clearly needed—along with the consolidation of the telematics market—given the scale of auto sales and theft growth in Brazil. As such, both OEMs and TSPs are moving in the right direction to offer additional ways to prevent vehicle theft through smart phones and monitored telematics systems.
While OEM solutions may have warranties and free-service bundles, IHS believes that even with the incentive of a two-year free telematics subscription, as in the case of Volvo, aftermarket telematics still constitute a more affordable alternative for the customer. The “price” of telematics is expected to cost approximately $46,000 for a new Volvo C30 with On Call. In comparison, one can get a vehicle offering similar features—and CONTRAN certifications—for $28,000, plus the cost of an aftermarket telematics service provider of their choice.
Even with vehicle safety as the chief concern, a range of other applications such as navigation, real-time traffic information, weather and others will contribute to the implementation and development of telematics in the country.
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