The European government is actively implementing favorable policies to promote the incorporation of telematics technology in vehicles. For example, the European Commission has made 112-based eCall in-vehicle alarm systems mandatory in all new N1 (light-duty vehicles) and M1 (passenger cars), in the European Union (EU) member nations,since March 31, 2018. This alarm system is an in-built device that makes automatic calls to emergency services in road accident and triggers one or more airbags of the car during the accident.

Moreover, the augmenting demand for improved safety features in vehicles will propel the European automotive telematics market at a 16.1% CAGR during the forecast period (2020–2030). The market generated revenue of $7,340.3 million in 2019 and it is expected to reach $37,249.8 million by 2030. Congestion on roads and increasing number of road accidents have led to serious injuries and deaths in the region. These accidents are primarily caused due to human errors that can be reduced through the installation of different telematics devices.
Passenger cars in the European automotive industry adopt the highest number of telematics solutions, due to the soaring demand for safety and security features to comply with the government norms. Besides, automakers are also installing telematics devices in commercial vehicles to curtail road accident cases and enhance driving experience. Besides, the rising adoption of next-generation telematics protocol (NGTP) to improve the telematics service delivery and increase the deployment of vehicle tracking features will accelerate the installation of these devices in commercial vehicles.

The service segment of the European automotive telematics market is categorized into safety and security, remote diagnostics, infotainment and navigation,fleet/asset management, vehicle to everything (V2X), and insurance telematics. Among these, the safety and security category is expected to exhibit the fastest growth in the forecast period, due to the implementation of stringent government laws on enhancing vehicle security. Moreover, the availability of connected and semi-autonomous vehicles and the development of intelligent transportation systems have a positive impact on the growth of the market in this category.

To ensure vehicle and road safety, telematics solution providers, original equipment manufacturers (OEMs), and other stakeholders are entering into partnerships to enhance their product portfolio and access the existing knowledge of theirpartners. For example, HARMAN International Industries Inc. partnered with Volkswagen AG, in October 2019, to provide its audio solutions to the automaker. Similarly, in February 2020, Masternaut Ltd. entered into a long-term contract with Fraikin SAS, a European commercial vehicle fleet service provider, to provide connected fleet management services and tools to Fraikin's 3,000 online order delivery vehicles in the U.K.

With the growing focus on vehicle safety and the increasing intervention by the governments, the adoption of telematics devices will spike in the coming years in Europe.