Global Intelligent Transportation System Market Size, Forecast, and Trend Highlights Over 2025-2037
Intelligent Transportation System Market size was valued at USD 55 billion in 2024 and is projected to reach USD 155 billion by the end of 2037, rising at a CAGR of 8.5% during the forecast period, i.e., 2025-2037. In 2025, the intelligent transportation system is estimated at USD 59 billion.
The Intelligent Transportation System (ITS) market is undergoing major supply chain shifts driven by rising production costs, consumer price changes, and increased investment. Between January 2024 and January 2025, the Producer Price Index (PPI) for transportation equipment rose 1.5%, reflecting growing freight and equipment costs. Mode-specific PPI changes included a 3.6% rise in air transport, 3.1% in trucking, 1.6% in rail, while water transport dropped by 0.9%. Freight and cargo service coordination surged by 9.8% in the same period.
On the demand side, the Consumer Price Index (CPI) for transportation goods and services rose 3.2%. Key drivers included an 11.8% rise in motor vehicle insurance, representing about 10.9% of the total rise in consumer goods pricing. Maintenance and repair costs rose by 2.4%, and airline fares by 1.9%. Additionally, technological progress continues to shape the market. The Federal Highway Administration awarded more than $96 million in Advanced Transportation Technology and Innovation (ATTAIN) grants for 20 projects across 16 states, covering smart, multimodal solutions for underserved regions. ITS development depends heavily on international trade for critical components. Rising input costs and CPI increases signal a constrained supply chain, highlighting the need for optimized logistics and forward-looking investment strategies.
Intelligent Transportation System Sector: Growth Drivers and Challenges
Growth Drivers
- Government initiatives & infrastructure investment: Governments worldwide are focusing on digital establishments and smart mobility solutions to enhance transportation efficiency, solve urban congestion, and improve road safety. Polices such as Japan’s Ministry of Land, Infrastructure, Transport and Tourism (MLIT) investment of $210 million in 2024 for ITS deployment in Tokyo, Osaka, and Nagoya are focused on V2X (Vehicle-to-Everything) communication systems and AI-enabled traffic management. These developments are designed to reduce traffic incidents by 20% and reduce urban congestion by 15% by 2027. Similarly, India’s Smart Cities Mission, which includes a budget of approximately USD 11.8 billion, is highly funding ITS-enabled projects like adaptive traffic control, automated surveillance, and multimodal transport integration across 100 designated cities. These major initiatives create favorable regulatory environments and encourage public-private partnerships, significantly increasing the development and deployment of ITS solutions globally.
- Technological advancements in AI, IoT & 5G: The incorporation of AI, IoT, and 5G connectivity is changing intelligent transportation systems. Real-time data collection, predictive analysis, and low-latency communication optimize route direction, accident detection, and help in autonomous vehicle performance. For instance, in several pilot projects in Europe and Asia, AI-driven traffic prediction systems have reduced traffic congestion up to 30%, reflecting the role of ITS. In 2023, China’s Ministry of Industry and Information Technology (MIIT) announced a 28% rise in 5 G-enabled IoT use for urban transportation systems, particularly in cities like Shenzhen and Shanghai, resulting in a 15–20% improvement in traffic flow during peak hours.
Major Technological Innovations in the Market
The ITS market is rapidly evolving, driven by technologies like AI, IoT, and V2X communication that boost safety, efficiency, and sustainability. AI-powered predictive analytics and real-time data from IoT devices are streamlining traffic flow and advancing autonomous vehicles. Key industries automotive, telecom, and logistics, are leading adoption. Regionally, North America leads in AI adoption due to strong infrastructure, while Asia-Pacific sees rapid ITS growth through urbanization and smart city projects. The table below highlights the current technology trends and their impact on various industries.
|
Trend |
Statistical Impact |
Example |
|
AI-Powered Traffic Management |
Travel time reduced by 14% (weekdays), 21% (weekends) |
Ann Arbor's adaptive traffic signal system |
|
Autonomous Vehicles (AVs) |
Energy consumption reduced by 27% in pilot fleets |
AI integration in autonomous test vehicles |
|
V2X Communication |
Supports safer expressway merging via vehicle-infrastructure data |
Toyota & NTT’s AI platform investment for automated driving |
|
IoT Integration |
Real-time data enables accurate traffic forecasting |
Aimsun Live forecasts urban and regional traffic using live feeds |
|
Predictive Maintenance |
Reduces vehicle downtime and maintenance costs |
AI sensors detect potential failures in trucks, trains, and aircraft |
Integration of AI and ML in the Intelligent Transportation System Market
AI and ML are transforming the ITS market by speeding up product development and improving operational efficiency. These advancements highlight how AI and ML are reshaping the ITS landscape, delivering clear improvements in both product development and operational efficiency.
|
Company |
AI/ML Application |
Verified Outcome |
|
Altair |
AI-driven simulations using HyperWorks platform |
Simulation results delivered up to 1,000x faster than traditional methods |
|
Inceptio Technology |
AI-powered autonomous driving for trucks |
Achieved over 51 million kilometers of accident-free operation |
|
Uber Freight |
AI for optimizing truck routing and automating customer service |
Reduced empty miles by 10–17%; cut service wait time from 5 minutes to 35 seconds |
|
Cityflo |
AI-based driver safety systems in metro fleets |
Improved passenger safety and operational performance in public transit |
|
LYT |
AI to manage emergency vehicle traffic signal priority |
Reduced emergency response times by 70%, from 45 to 145 minutes city-wide |
Challenge
- Data security concerns: As ITS heavily relies on real-time data from IoT devices, sensors, and connected vehicles, ensuring the security and privacy of this information is critical. The huge exchange of data between vehicles, infrastructure, and cloud systems makes the system vulnerable to cyberattacks, data breaches, and unauthorized access. A compromised ITS network can lead to significant risks, including traffic disruptions, safety hazards, and loss of public trust. Moreover, complying with various national and regional data protection regulations, such as GDPR in Europe or CCPA in California, makes the deployment of ITS more complex. Thus, handling this challenge requires robust cybersecurity frameworks, encrypted communication protocols, and consistent monitoring systems.
Intelligent Transportation System Market: Key Insights
| Report Attribute | Details |
|---|---|
|
Base Year |
2024 |
|
Forecast Year |
2025-2037 |
|
CAGR |
8.5% |
|
Base Year Market Size (2024) |
USD 55 billion |
|
Forecast Year Market Size (2037) |
USD 155 billion |
|
Regional Scope |
|
Intelligent Transportation System Segmentation
System (Advanced Traffic Management Systems (ATMS), Advanced Traveler Information Systems (ATIS), Advanced Transportation Pricing Systems (ATPS), Advanced Public Transportation Systems (APTS))
The advanced traffic management systems segment is projected to hold a 36% share by the end of 2037, as they are important components of ITS designed to monitor, control, and optimize traffic flow. These systems use technologies such as sensors, cameras, and AI-driven analytics to manage congestion and reduce travel times. The growth of ATMS depends on growing urbanization, increasing vehicle ownership, and the need to enhance road safety and reduce emissions. In the global space, government support in smart city infrastructure development is also pushing ATMS adoption. Additionally, the incorporation of real-time data and predictive traffic modeling improves decision-making for traffic authorities, further increasing demand.
Mode of Transport (Roadways, Railways, Airways, Maritime)
The roadways segment is estimated to hold a leading revenue share of 56% during the forecast timeline. The segment's growth is impacted by the surging push in improving vehicle and traffic management in highways, urban roads, intersections, etc. With investments increasing in traffic management solutions, the demand for real-time data analytics is poised to rise further. Trends highlight that numerous governments are prioritizing smart road infrastructure via initiatives such as connected vehicle technologies, adaptive traffic signals, etc. Furthermore, the growing integration of IoT and AI in road management systems has made traffic management comparatively more efficient.
Our in-depth analysis of the global intelligent transportation system market includes the following segments:
|
System |
|
|
Mode of Transport |
|
|
Application |
|
|
Component |
|
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Intelligent Transportation System Industry - Regional Synopsis
North America Market Analysis
The intelligent transportation system market in North America is projected to hold a 38% share during the forecast period, owing to notable public and private sector investments in smart mobility infrastructure. The region's focus on reducing urban traffic congestion, improving road safety, and integrating electric vehicle infrastructure supports ITS adoption. The widespread deployment of 5G also allows advanced vehicle-to-infrastructure (V2I) communications. Canada and the U.S. are implementing national policies that encourage smart city developments and connected transport systems. Additionally, increasing cross-border freight movement is driving demand for real-time traffic and logistics management tools.
The U.S. intelligent transportation system market is rapidly expanding owing to strong federal funding, technological innovation, and public safety mandates. Programs such as the US Department of Transportation's ATTAIN initiative and the Infrastructure Investment and Jobs Act are injecting billions into smart transportation technologies. The top cities in the country are adopting AI-powered traffic systems to reduce emissions and improve movement. Further, the rise of autonomous and electric vehicles has increased the need for integrated traffic control and smart roadway solutions. Moreover, partnerships between government agencies and tech companies are encouraging rapid ITS deployment across urban and rural areas.
Asia Pacific Market Analysis
Asia Pacific is estimated to represent the fastest growth at a CAGR of 11% during the forecast period, owing to booming urbanization and the rise in metro cities. Government-led smart city initiatives across India, Japan, and Southeast Asia are supporting demand for advanced traffic management and public transport systems. The incorporation of AI, IoT, and 5G in urban mobility infrastructure is becoming a norm. Additionally, rising concerns over road safety and pollution control are further boosting the adoption of ITS technologies. Additionally, growing investments in railway and metro modernization are expanding ITS applications beyond roadways.
The China intelligent transportation system market is projected to hold a notable share during the forecast period, owing to massive government support and its national strategy to lead in smart mobility. The Ministry of Transport and MIIT have launched pilot zones for intelligent connected vehicles, accelerating infrastructure readiness. China's high urban population pushes the need for AI-based traffic prediction, smart signaling, and AI-powered transit solutions. In 2023, China built over 3,000 km of intelligent expressways, improving traffic efficiency and logistics operations. The role of ITS in national planning, backed by top local companies, namely Huawei and Baidu, is making China a global ITS innovator.
Companies Dominating the Intelligent Transportation System Landscape
- Company Overview
- Business Strategy
- Key Product Offerings
- Financial Performance
- Key Performance Indicators
- Risk Analysis
- Recent Development
- Regional Presence
- SWOT Analysis
The intelligent transportation system market includes both major conglomerates and niche players. European companies such as Siemens AG and Thales Group lead in traffic and public transport systems, while U.S. companies Cubic Corporation and Garmin Ltd. concentrate on fare collection and navigation. Japan firms DENSO and Hitachi provide advanced automotive and infrastructure tech. Key strategies involve AI traffic analytics, smart city partnerships, and growth in emerging urban markets. Given below is a table of the top players in the intelligent transportation system market with their respective shares.
|
Company Name |
Country |
Estimated Market Share (%) |
|
Siemens AG |
Germany |
13% |
|
Thales Group |
France |
11% |
|
Cubic Corporation |
USA |
10% |
|
Kapsch TrafficCom AG |
Austria |
9% |
|
TomTom NV |
Netherlands |
xx% |
|
Garmin Ltd. |
USA |
xx% |
|
Q-Free ASA |
Norway |
xx% |
|
Iteris, Inc. |
USA |
xx% |
|
EFKON AG |
Austria |
xx% |
|
Lytx, Inc. |
USA |
xx% |
|
Masabi Ltd. |
UK |
xx% |
|
DENSO Corporation |
Japan |
xx% |
|
Hitachi, Ltd. |
Japan |
xx% |
|
Mitsubishi Heavy Industries, Ltd. |
Japan |
xx% |
|
Sumitomo Electric Industries, Ltd. |
Japan |
xx% |
Given below are the areas covered for each company in the intelligent transportation system market:
Recent Developments
- In February 2025, May Mobility transitioned its autonomous shuttle service in Peachtree Corners, Georgia, to a driver-out operation, marking the company's first commercial deployment without a safety operator on board. This milestone demonstrates the scalability and safety of May Mobility's autonomous technology, which has also been deployed in cities like Ann Arbor, Michigan, and Sun City, Arizona.
- In July 2024, Siemens Mobility secured a $221 million contract with Berliner Verkehrsbetriebe (BVG) to implement a Communications-Based Train Control (CBTC) system on Berlin's U5 and U8 metro lines. This advanced signaling technology is expected to increase train capacity by 30% and reduce intervals between trains to under 100 seconds, significantly enhancing urban mobility in Berlin.
Author Credits: Preeti Wani
- Report ID: 3261
- Published Date: Jun 05, 2025
- Report Format: PDF, PPT
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