In-Vehicle payments spend to exceed USD 86 billion in 2025
Dr. Evangelo Damigos; PhD | Head of Digital Futures Research Desk
- Digital Transformation
- Sustainable Growth and Tech Trends
- Emerging Technologies
Publication | Update: Oct 2020
A new study from Juniper Research has found that the value of in-car payments, where a payment is made via embedded vehicle systems, will reach USD 86 billion in 2025, up from just USD 543 million in 2020.
The report recommended that, in order to support this growth, established payments vendors must be included within collaborative ecosystems, to ensure that requirements such as security via tokenisation and integration with digital wallets are achieved effectively. These elements will be critical in establishing in-car payments as a viable channel and, if ignored, will likely see initiatives fail to achieve widespread adoption.
The new research, “In-vehicle Payments: Adoption, Vendor Positioning & Market Forecasts 2020-2025,” found that fuel and electric vehicle charging payments will be the leading area for in-car payments adoption; accounting for 77% of payments by value in 2025. This will be largely due to the high number of anticipated future partnerships in this area, as well as the ease of migrating existing mobile payment solutions into in-car systems.
Juniper Research’s new In-vehicle Payments’ research report provides an in-depth evaluation of how this nascent market is developing and how use cases are emerging for the implementation of payments in both consumer and commercial vehicles. The report focuses on the strategies required to drive the connected car commerce market forward, as well as providing an extensive forecast suite, which outlines the future rate of adoption for in-vehicle payment solutions. The forecast and the use case analysis in the report focus on the following segments:
- Automated toll road payments
- Fuel/electric vehicle charging payments
- Smart parking payments
- Other in-vehicle payments (including for coffee, food and eCommerce purchases)
The research found that voice commerce will be a major supporting factor in the in-car payments market. The increasing integration of voice assistants within the vehicle’s systems, not just via smartphone mirroring, will enable drivers to make ecommerce purchases from behind the wheel in a seamless way. This will drive other in-car payments, including ecommerce, food and drinks to over USD 11 billion in 2025, from just USD 12 million in 2020.
Objectives and Study Scope
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The Global Economic Model
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The degree of necessity. Luxury products and habit forming ones, typically have a higher elasticity.
Proportion of the budget consumed by the item. Products that consume a large portion of the consumer’s budget tend to have greater elasticity.
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