The Market for Intelligent Transportation Systems in the U.S. and North America 2011
The Intelligent Transportation Society of America (ITS America) has completed a two-phase study, commissioned by the U.S. Department of Transportation Research and Innovative Technology Administration (RITA), to develop accurate and comprehensive estimates of the breadth and size of the U.S. and North American Intelligent Transportation Systems (ITS) markets. Prior to this study, the ITS industry, and particularly the private sector portion, had never been extensively characterized.
The study concludes that, in addition to the $48 billion U.S. ITS end-use products and services market, the rest of North America (Canada and Mexico) contributes another $4 billion in ITS revenues, for a total North American ITS end-use product and services market of $52 billion.
ITS is the collective term for the use of electronics, communications, and information processing technology to improve all aspects of the surface transportation system. As transportation management officials have over the past 10 to 20 years proactively applied ITS to solve transportation problems, they have been able to multiply positive impacts and improve the use of transportation resources. Such applications also have positive effects on transportation system efficiency and sustainability, safety, the environment, congestion, and traveler mobility and convenience.
Supporting research to advance the ITS industry, U.S. DOT RITA commissioned this supply-side study to better understand the scope, scale, and growth projections within the private sector, where service offerings, scale, visibility, and use by consumers and public agencies–particularly state and local government agencies–is growing. The study is based on a private sector survey of companies and extensive econometric modeling.
You can read a summary of the conclusions and download the final reports below.
The Study Methodology
ITS America and its partner, IHS Global Insight, identified and validated 3,000 U.S. companies operating in ITS. The study identified total company revenues and then focused 2in on the less than three percent attributable to ITS end-use products and services-the ultimate applications for which these ITS products/services have been designed. The report estimates Calendar Year (CY) 2009 U.S. ITS company revenues of $48 billion for end-use ITS manufacturing products ($26.1 billion) and end-use ITS services ($21.9 billion).
The research attributes almost 180,000 private sector jobs to the U.S. ITS end-use market alone, with a total of 445,000 jobs in the total industry value chain. Projections for the U.S. ITS industry are for continuing growth, with CY 2015 projected end-use revenue increasing by almost 41 percent (over CY 2009) and private sector employment of more than 205,000. Total industry employment—including providers of enabling services and ITS components as well as end-use products and services—is projected to exceed 500,000. U.S. patent statistics likewise point to continued ITS industry growth and innovation, with U.S. ITS-related patent applications growing 17 percent from 2007 to 2008, when overall patent applications were static.
This landmark supply-side market analysis used a four-stage process:
- Stage 1 focused on understanding and defining private sector products and services in the ITS universe. Researchers updated and vetted the National ITS Architecture’s market packages to ensure inclusion of the current, full range of private sector ITS products and services. This product/service list served as the foundation for the market estimate and a critical ITS filter throughout the study.
- Stage 2 identified North American companies active in ITS using internal industry data bases, international listings of ITS companies, ITS exhibitor listings, and extensive internet and report research to compile a list of more than 15,000 potential ITS-related companies. Researchers winnowed down this list−eliminating duplicates, subsidiaries, those not in the ITS market, to identify the 3,000 ITS companies on which the data is based.
- Stage 3 sought primary data from identified ITS companies via an electronic survey, tested in the study’s initial phase. More than 10 percent of the companies responded and provided sensitive information about ITS revenues, private sector employment, and industry sector identification. Survey respondents included companies engaged in all market aspects of ITS, including traffic management, traveler information, public transportation, emergency management, maintenance and construction operations, archived data management, commercial vehicle operations, vehicle safety, and other cross-cutting areas of ITS.
- Stage 4 developed an econometric model, informed by the critical private sector industry survey data, tested the statistical model, and used the model to generate ITS industry estimates. Further analysis delineated the “End-Use Product and Services” portion of the industry.
While previous studies have examined various aspects of the ITS market, this is the first study to analyze the full and diverse spectrum of ITS, and to link the analysis of the market to 86 identified industrial sub-groups of the North American Industry Classification System (NAICS) in which ITS business operates.
The ITS Market Data Analysis Observations and Conclusions
The study concludes that, in addition to the $48 billion U.S. ITS end-use products and services market, the rest of North America (Canada and Mexico) contributes another $4 billion in ITS revenues, for a total North American ITS end-use product and services market of $52 billion.
The study further highlights the impact of ITS private sector employment on every state in the U.S. and small business’ significant role in the ITS industry, with 73 percent of U.S. ITS revenues attributable to companies with fewer than 500 employees.
The report offers the following observations about the U.S. and North American ITS industry size and outlook:
- The economic impact of the ITS industry is significant. Modelers estimate an end-use ITS market of $48 billion. The rest of North America contributes an additional $4 billion in revenue. U.S. ITS market revenues exceed those for electronic computers, motion picture and video products, direct mail advertising, or internet advertising.
- The outlook for the ITS industry is positive. The model anticipates continuing expansion and a projected CY 2015 total U.S. private sector ITS market of $67 billion and an additional $6 billion for the rest of North America. From CY 2009 through CY 2015, U.S. private sector revenues are expected to climb between $2.7 billion to $4.2 billion each year, with ITS revenue growth exceeding average growth for the U.S. and North America.
The report offers the following observations about the U.S. employment and small business impacts:
- ITS employment impacts every state in the U.S.
- For CY 2009, the econometric model estimates that 445,000 jobs in the U.S. are ITS-related.
- The U.S. end-use market contributes almost 180,000 private sector jobs (40 percent) to this total and the rest of North America an additional 20,000.
- The ITS end-use market contributes more jobs to the U.S. economy than the motion picture/video production or electronic computer markets.
- ITS jobs pay well. Based on survey responses, average ITS salaries are well above the national average by more than $32,000. Even the lowest paid occupational category of ITS employees earns more than 8 percent above the national average wage. More than half of the U.S. ITS jobs categorized by occupation had associated salaries of $69,000 or more. Three occupations (software developer, hardware developer, and other engineering) account for 32 percent of the ITS jobs.
- The employment outlook for the U.S. and North American ITS industry is positive and better than for the economy overall.
- By CY 2015, North American end-use ITS employment is projected to Increase by 16 percent over CY 2009 levels and to contribute more than 231,000 jobs. During the same period, U.S. private sector end-use employment is projected to Increase 14 percent.
- For the U.S. end-use market, the model projects job gains of 0.7 percent in CY 2010 and 2 percent in CY 2011, with steadier growth of 3,600 to 6,400 jobs each year through CY 2015, when private sector end-use market ITS employment is projected to reach more than 205,000.
- ITS companies responding to the survey were more optimistic than model projections. These specific companies reported domestic ITS-related employment Increases of almost 15 percent from CY 2008 to CY 2009 and an expected, additional job Increase of more than 13 percent in CY 2010.
- By CY 2015, the ITS value chain (including enabling services and components as well as end-use products and services) is projected to contribute 500,000 U.S. jobs and an additional 64,000 in the rest of North America.
- Small businesses play a significant role in the ITS industry.
- According to the model, 73 percent of U.S. ITS revenues are attributable to companies with fewer than 500 employees.
- Ninety-seven percent of the companies responding to the survey that were predominantly focused on ITS and reported employment had fewer than 500 employees.
The report offers the following observations about technology and innovation:
- There is tremendous variety in ITS products. The MDA survey and firmographics research confirm that at least 3,000 companies produce ITS products and services for the U.S. market; these companies in the ITS value chain span 86 NAICS industry sub-categories.
- Patent statistics and survey data point to continued ITS industry growth and innovation. Small and large companies alike apply for and are granted patents. From CY 2007 to CY 2008, when overall U.S. patent applications were static, ITS-related patents grew 17 percent.
Final Reports - ITS Market Data Analysis
- Recording of August 10, 2011 media call on the ITS Market Data Analysis study release
- Press Release–Report Indicates ITS Has Grown to $48 Billion in Spite of Economy, Projected to Expand Through 2015
- Fast Facts About Transportation Technology: The Biggest Industry You’ve Never Heard Of
For other ITS America Research projects, see the Technology Scan and Assessment 2009-2012.
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