Intelligent Traffic Signal System Market Size - By Technology, By Component, By Application, By End Use, Analysis, Share, Growth Forecast, 2025 - 2034

Intelligent Traffic Signal System Market Size

The global intelligent traffic signal system market size was valued at USD 5 billion in 2024 and is projected to grow at a CAGR of 10.2% between 2025 and 2034. Technological advancements are driving the growth of the market by improving the efficiency and adaptability of traffic systems. The use of AI and ML enables traffic signal systems to process real-time data, predict traffic patterns, and adjust signal timings based on current conditions. This helps reduce congestion, cut delays, and enhance traffic flow.
 

Additionally, IoT devices, such as connected sensors, cameras, and traffic lights, allow continuous traffic monitoring. Through Vehicle-to-Infrastructure (V2I) technologies, these devices enable communication between vehicles and traffic signals, allowing signals to prioritize emergency vehicles, public transport, or congested areas, thereby improving traffic management.
 

For instance, in October 2024, SRL Traffic Systems announced of launching its new TOPAS-compliant portable traffic signal, named UltraLight, at the Highways UK event. This innovative product has achieved compliance with the TOPAS 2540A standard, which is increasingly required in Intelligent Transport System (ITS) contracts. UltraLight is compatible with SRL's Solar Plus technology, enabling users to harness solar energy and reduce their carbon footprint
 

Urbanization and increasing traffic congestion is another major driving factor of this market. As cities worldwide face rapid population growth and urban expansion, the number of vehicles on the road continues to rise, leading to more congestion, longer commutes, and inefficient traffic flow.
 

Traditional traffic management system often fails to address these challenges, resulting in traffic jams, higher emissions, and safety risks. Intelligent traffic signal system, which use real-time data and adaptive signal control, provide solutions by optimizing traffic flow. These systems adjust signal timings based on factors like traffic volume, weather conditions, and accidents, helping to reduce delays and improve road safety.
 

Intelligent Traffic Signal System Market Trends

Adaptive signal control technologies are being increasingly adopted as they enable traffic signals to adjust in real-time based on traffic flow, weather conditions, and accidents. This capability improves traffic movement, reduces congestion, and enhances road safety. With the growing implementation of smart city initiatives, cities are focusing more on integrating IoT devices into traffic systems. These devices, including sensors, cameras, and connected traffic lights, support continuous data collection and communication between vehicles and infrastructure, improving real-time decision-making and coordination in urban mobility systems.
 

The integration of AI and ML into traffic signal systems is becoming more common. These technologies help study traffic patterns, forecast congestion, and adjust signal timings to improve traffic management efficiency. Additionally, AI-powered systems can prioritize busy routes and public transportation, ensuring smoother vehicle movement and reducing delays.
 

Integration challenges and complexities remain significant barriers to the growth of the intelligent traffic signal system market. Many cities continue to rely on outdated traffic systems that are not compatible with modern, data-driven technologies, making integration difficult. Furthermore, the lack of standardization among vendors adds to these challenges. Traffic signal systems, sensors, communication networks, and software often operate on different protocols and platforms, which hinders seamless connectivity and data sharing. This leads to increased integration costs, longer deployment timelines, and potential service disruptions.
 

Intelligent Traffic Signal System Market Analysis

Based on application, the market is segmented into urban traffic management, highway traffic management, smart city initiatives, public transportation management, and emergency vehicle management. In 2024, the urban traffic management segment held a market share of over 31% and is expected to exceed USD 4 billion by 2034, due to the growing challenges of rapid urbanization and the increasing need for effective urban mobility management.
 

As cities grow and populations increase, traffic congestion has become a significant problem, resulting in longer travel times, higher fuel consumption, and more environmental pollution. Traditional traffic management systems often struggle to handle the complex and changing nature of urban traffic. Intelligent traffic signal systems address these issues by using real-time data and adaptive signal control technologies to improve traffic flow, reduce congestion, and enhance road safety.
 

Based on the component, the intelligent traffic signal system market is divided into hardware, software, and services. The software segment held around 42.5% of the market share in 2024, due to its significant role in operating and optimizing intelligent traffic systems. Software solutions manage key functions such as real-time traffic data processing, signal timing adjustments, and overall system performance. Unlike traditional systems with fixed signal timings, intelligent systems use advanced software algorithms to analyze traffic flow, adapt to changing conditions, and optimize signal phases, improving efficiency and reducing congestion.
 

North America intelligent traffic signal system market accounted for 35% of the revenue share in 2024, owing to its advanced infrastructure, large investments in smart city projects, and high adoption of technology. Major cities like New York, Los Angeles, and Chicago face severe traffic congestion, driven by urbanization and technological growth. To address these issues, local governments and transportation authorities are investing in innovative solutions to improve traffic management, reduce congestion, and enhance road safety. Intelligent traffic signal systems, which use real-time data, AI, and ML, are considered essential for optimizing traffic flow and minimizing delays.
 

The demand for intelligent traffic signal system in Europe is increasing rapidly due to the region's focus on sustainability, smart city projects, and the need to manage growing urban traffic congestion. Cities in countries such as the UK, Germany, France, and the Netherlands face challenges like rising urbanization, higher vehicle numbers, longer commute times, and environmental pollution. Traditional traffic management systems are often inadequate to handle these issues effectively, leading to a shift toward advanced solutions like ITSS. These systems use real-time data analytics, adaptive signal control, and communication technologies to reduce congestion, improve traffic flow, and enhance safety.
 

The Asia Pacific region is witnessing a rapid increase in demand for intelligent traffic signal system, driven by urbanization, growing vehicle ownership, and large-scale infrastructure development in countries such as China, India, Japan, and South Korea. As one of the fastest-growing regions in terms of population and urbanization, the area faces significant challenges like traffic congestion, pollution, and outdated transportation systems.
 

The rising number of vehicles on the roads has led to issues such as gridlock, longer travel times, and worsening air quality. Traditional traffic management systems are unable to address these problems effectively, creating a need for advanced solutions like ITSS. These systems use real-time data from sensors, cameras, and other connected devices to adjust signal timings, improving traffic flow and reducing congestion.
 

Intelligent Traffic Signal System Market Share

Siemens and Cubic Corporation collectively held a substantial market share of over 12% in the intelligent traffic signal system industry in 2024. Both the companies hold a significant share in the intelligent traffic signal system market due to their expertise, advanced technology, and comprehensive solutions. Siemens provides a variety of integrated traffic management systems that use AI, adaptive signal control, and cloud-based platforms to help cities improve traffic flow and reduce congestion.
 

Cubic Corporation offers scalable systems designed to address the complex needs of urban mobility through real-time data analytics and smart transportation solutions. Both companies leverage their extensive industry experience, global presence, and continuous innovation to maintain their leadership in the market.
 

Swarco AG and Teledyne FLIR are taking strategic actions to strengthen their positions in the Intelligent Traffic Signal System Market. Swarco AG is expanding its range of smart mobility solutions, focusing on adaptive traffic management systems and cloud-based software to improve traffic flow and reduce congestion.
 

The company is also increasing its involvement in global smart city projects by partnering with local governments to implement advanced traffic management systems. Similarly, Teledyne FLIR is enhancing its market presence by incorporating advanced technologies, such as thermal imaging, modern sensors, and AI-based analytics, into traffic signal systems. These innovations aim to improve safety, traffic monitoring, and real-time decision-making. 
 

Intelligent Traffic Signal System Market Companies

Major players operating in the intelligent traffic signal system industry are:

• AECOM
• Cubic
• Dynniq
• Econolite
• Intelligent Traffic Systems
• Iteris
• Kapsch
• LG CNS
• LITE-ON Technology
• Parsons
   

Intelligent Traffic Signal System Industry News

• In August 2024, the Gurugram Metropolitan Development Authority (GMDA) expanded its smart traffic signal project to include 32 junctions in Sectors 58 to 115. This initiative is part of the second phase of the project, which aims to enhance traffic management and pedestrian safety throughout the city. The new smart traffic signals will feature Adaptive Traffic Control Systems (ATCS), which utilize real-time data to adjust signal timings based on traffic volume. This capability aims to reduce congestion and improve overall traffic flow. Additionally, the signals will include pedestrian lights to enhance safety at busy intersections
   
• In July 2024, LEOTEK has officially acquired the traffic business of Dialight, a prominent player in LED industrial lighting, enhancing its position as a leading provider of traffic signal solutions in the Americas. This acquisition is part of LEOTEK's strategic expansion into the smart transportation sector, focusing on efficient and low-carbon city management.
   

The intelligent traffic signal system market research report includes in-depth coverage of the industry with estimates & forecasts in terms of revenue ($Bn) from 2021 to 2034, for the following segments:

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Market, By Technology

• Fixed time signal system
• Vehicle actuated signal system
• Adaptive signal control system
• Artificial intelligence-based signal system
• Connected vehicle-based signal system

Market, By Component

• Hardware
  • Traffic signal controllers
  • Sensors
  • Communication devices
  • Power supply systems
• Software
  • Traffic management software
  • Analytics platforms
  • Cloud-based solutions
• Services
  • Installation
  • Maintenance
  • Consulting
  • Integration services

Market, By Application

• Urban traffic management
• Highway traffic management
• Smart city initiatives
• Public transportation management
• Emergency vehicle management

Market, By End Use

• Government transportation departments
• Municipal corporations
• Highway authorities
• Public transit agencies
• Smart city developers
• Private infrastructure companies

The above information is provided for the following regions and countries:

• North America
  • US
  • Canada
• Europe
  • UK
  • Germany
  • France
  • Spain
  • Italy
  • Russia
  • Nordics
• Asia Pacific
  • China
  • India
  • Japan
  • South Korea
  • ANZ
  • Southeast Asia
• Latin America
  • Brazil
  • Mexico
  • Argentina
• MEA
  • UAE
  • South Africa
  • Saudi Arabia