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OBD market is expected to grow at a CAGR of close to 16% during 2017-2021

According to a report by Technavio Global automotive OBD market is expected to grow at a CAGR of close to 16% during the period 2017-2021. The US and Europe are the largest markets for OBD, however, the market is expected to witness exponential growth in emerging countries.  These countries are expected to adopt regulations enforcing mandatory OBD systems and stringent emission norms, which will lead to the growth of the market.


The other points highloghted by the report are:

The top three emerging market trends driving the global automotive on-board diagnostics market according to Technavio research analysts are:

Growing focus on remote diagnostics

  • Remote OBD systems diagnose a fault or a potential malfunction in the component of a vehicle and transmit the relevant trouble codes to a remote data center. The data center then collects the data in usual software or application compatible formats that help interpret the data and send them across to the respective driver or technician. Remote diagnostics is a valuable tool as it helps in preventive maintenance and scheduling vehicle service cycles, which helps in reducing vehicle downtime and breakdowns.
  • Shift in focus from OBD hardware to OBD software. The shift in focus of car diagnostic tool manufacturers from OBD terminal to software interface is an emerging trend influencing market growth. The market is witnessing significant innovations in the field of embedded software to enhance connectivity concepts and user experience of OBD systems. Software developers are exploring cloud platform and big data analytics to interpret data provided by the OBD systems for greater accuracy.
  • Integration with telematics: The players in the automotive OBD systems market are focusing on the development of integrated OBD telematics. An OBD telematics system usually includes the OBD terminal and OBD software. This is the platform for communication between the equipment and the driver or technician.

With the introduction of smartphone connectivity with the vehicle, many companies are developing mobile software applications that integrate with the vehicle’s OBD system. It also includes cloud platforms where the data collected from the OBD systems is transmitted to a remote cloud platform where the data is interpreted, and relevant information is passed on to mobile applications. As the overall telematics market is at a nascent stage, many OBD providers are focusing on leveraging this technology and integrating OBD telematics system in vehicles.

According to official notification of  government of India  in July 2008, OBD I  had to be fitted in vehicles manufactured onwards April 2010( with some exception) and OBD II from April 2013 for all categories.However, in India vehicle maintenance is still being largely dictated by traditional norms of vintage and mileage besides physical symptoms of the vehicle based on which doctors(read mechanics ) prescribe maintenance. This is primarily due to lack of consumer awareness and low interest on part of workshops to promote this kind of maintenance approach which can pass on the  benefit of OBD and reduce on maintenance cost for the end customer.

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