THIS WEEK WE BUY...
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Buying a fleet telematics system can be an expensive minefield. But keeping a few key points in mind will ensure that the system you buy is the one you need
COUNTLESS POSSIBILITIES
WHAT TELEMATICS CAN DO FOR YOU Before investing in a system, perhaps the most important decision is establishing what exactly you want telematics to deliver, now and in the future. Vague notions and the desire to keep up with the Joneses are not sufficient. First steps towards telematics may be based on a rough idea of the benefits, but it is good to have a fully costed business case before signing on the dotted line.
Telematic systems can monitor and report on a bewildering range of information. Much relates to vehicle and driver activity, such as:
• vehicle position and navigation • distance covered • road speeds – maximum and average • engine idle time • use of top gear • use of cruise control • fuel consumption • harsh braking • axle weights • monitoring vehicle diagnostics fault codes.
The key to this wealth of data was the advent of first vehicle multiplex electrical systems and then CAN (controller area network) circuits, giving access to masses of vehicle operating data whizzing along CANbus circuits. Ancillary connections extend the list still further, to things such as the temperature inside a refrigerated trailer or a record of trailer-door openings. And now we can hook up digital tachographs to the telematics system too, enabling remote downloading of drivers’ hours information for tachograph analysis, the Working Time Directive and the wage system. Using telematics to streamline the management of tachograph data could be a big plus for operators with out-based vehicles.
Some systems also provide the driver with instant feedback to encourage more fuelefficient driving.
The presence of mobile phone technology in telematics systems also means they can provide both voice and text communications between driver and base. Digitally captured signatures can be sent back to base as POD (proof of delivery). Note, however, that such communications will generally require ancillary equipment such as barcode scanners, telephone handsets or in-cab terminals.
Telematics systems can also interface with other computer systems – both yours and your customers’. Comparing routes and schedules planned by scheduling software with the actual journey times recorded by the telematics system is now possible. Drivers can receive instructions from the firm’s order processing software on the move.
Sharing the data captured by telematics systems with other parties is also no problem – systems can generate an automated email or text message advising your customers of your vehicle’s imminent arrival, for example. Many users start with a simple vehicle tracking package, adding more bells and whistles later. So you should consider scope for future development and the ability to interface with other computerised systems.
Mainstream telematics systems track vehicles, not trailers. If tracking the trailer and its load is critical you may consider trailertracking systems that are battery-operated, recharged from the tractor unit via the electrical suzie. This is particularly useful if trailers are hauled by other contractors or if you need to keep track of stand-trailers dotted about the country.
If you carry high-value loads or use specialist vehicles, you may be particularly interested in the threat of vehicle theft, in which case a covert stolen-vehicle recovery system that can be tracked by police could fit the bill.
Resist being wooed by clever technology for its own sake. Draw up a priority list, ranking system features under headings such as essential, useful, interesting and superfluous. Think how your business can benefit from each function – and which ones you can do without. Without contradicting the principle of having a clear vision of what you need, it is also a good idea to leave scope for the unknown. A tight specification and a closed mind can lead to missed opportunities.
Costs and contracts
Telematics systems are generally sold in one of two ways. First, you can purchase the hardware and pay for installation upfront, with a relatively small monthly fee for the website reporting and service provision thereafter. Second, and reckoned to be the more popular route, is leasing the whole package and paying a single, monthly charge. Where you buy the vehicle hardware, expect to pay around £250 to £1,000 per truck (including installation) with a monthly fee of £10 to £30 per vehicle thereafter. An all-in leasing package, meanwhile, will typically cost £15 to £50 per vehicle per month, including the data transmission costs. Those price ranges are unavoidably large because so much depends on the extent of the system.
Buying upfront will almost certainly save money in the long run but exposes you to the risk of your supplier going under, in which case you are likely to be left holding a largely useless asset. Leasing your equipment avoids this, but may cost more on a monthly basis.
Contract periods also affect the price you pay, with lower monthly charges for longer periods. Typical contracts run for three or five years, although some suppliers offer shorter periods. A relative newcomer to the market is the Asia Motor Works (AMW) concern of Mumbai, which entered the market in 2008 and claims to have already sold 20,000 vehicles. Its heavy-duty trucks feature cabs from the Chinese FAW company, Cummins engines, ZF or Eaton gearboxes and Meritor axles. The highlight of its stand was its new truck range, which features an entirely new cab. Despite the passing resemblance to Volvo’s FM, it is an exclusive design from the Bertone design house in Italy.
Another recent development in the Indian heavy truck market is the arrival of the Mahindra Navistar range of rigids and tractors, which have been developed under a joint venture with the Navistar Corporation. Launched in 2010, there are now 2,500 of these trucks plying their trade on India’s roads, all powered by the Maxxforce 7.2-litre engine (210hp to 260hp). They are marketed as being able to outperform other domestic models and “end the reign of mediocre power, reliability, comfort and service in India”.
A joint venture with an established heavy truck builder was also the route chosen by Force Motors to extend into higher weight vehicles through its arrangement with MAN. MAN Force Trucks was a 50/50 venture from 2008, but MAN has recently taken steps to acquire the full business. The MAN CLA is a range of rigids and tractors from 25 tonnes GVW to 49 tonnes GCW. They utilise the old MAN L2000 cab design, Euro-3 engines, and use 90% locally sourced content.
Swaraj Mazda was founded in the 1980s to produce lightweight trucks and buses based on Mazda designs, but a technical agreement with Isuzu has seen the introduction of Isuzu engines and a change of company name to SML Isuzu. The company exhibited its 12.5tonne IS12T medium-duty truck, which uses a derivative of the old Mazda cab.
Reminders of home
In addition to the Ashok Leyland vehicles displaying their Leyland “catherine wheel” badges, a further reminder of home could be seen on the Daf stand where a special CF was exhibited. This was a Leyland-built CF65 tipper powered by a Cummins B5.9 engine of 246hp with a ZF six-speed gearbox. Daf has no current partner in India, and has yet to develop a strategy for the market, but the lorry was displayed to show potentially interested parties what kind of vehicle could be available, and it certainly seemed to be attracting some positive interest.
Other importers are selling in India in relatively small numbers. Scania and Hino have Indian sales operations and Kamaz sixand eight-wheelers are available from Kamaz Vectra Motors. However, the big news in India at the moment is the establishment of a new Daimler heavy truck brand. BharatBenz will commence production of a full range of trucks from 6 tonnes to 49 tonnes in a new factory near Chennai this year. Although the trucks, based on Fuso Canter and Mercedes trucks, were not shown at Auto Expo, they will add to the interest in the next show in one of the world’s fastest growing and most unique markets. ■ Telematics offer many beneits, from the ability to locate each and every vehicle to the production of reports grading drivers’ techniques. But the novelty of seeing each truck’s position on a screen in the trafic ofice soon wears thin. Telematics systems cost a lot of money, when the objective is to save money.
Using the information
Only management action can turn costs into savings. So before embarking on a telematics project, it is crucial that you have a clear idea of how you will use the information from telematics to cut costs and generate a return. A system unable to justify itself in inancial terms is worthwhile only if it enhances customer service or because the business needs telematics in order to compete or stay safe and legal.
If you are struggling to justify the system along these lines, alarm bells should be ringing. Unless properly speciied and properly used, telematics may be an expensive waste of time.
GENERAL PRINCIPLES
Telematics systems use an on-board box of electronics to monitor a series of key operating parameters and transmit data at regular intervals to a central computer. The computer’s software sorts and presents the information for analysis and management action. Most – but not all –systems use GPS satellites to locate vehicles and they relay data from vehicle to base via the mobile phone General Packet Radio Service (GPRS) networks.
The host computer may be at the operator’s site but will usually be operated by the telematics service provider, with truck operators logging onto a website to access their data and reports.
INSTALLATION ISSUES
You will probably need permission from the vehicle owner – the contract hire company, for example – to install the hardware and you may face charges for any damage caused by installation or subsequent removal. Drilling holes in the dashboard for in-cab terminals can be an issue. Check with the telematics supplier exactly how they intend to install their hardware and make sure the vehicle owner agrees. Vehicle manufacturers are understandably wary of third parties tapping into vehicle CANbus circuits. For this reason European CV manufacturers in 2002 adopted a standard protocol known as the FMS (Fleet Management System) standard to allow third-party telematics systems safe access to a limited range of information on the CANbus. This acts as a filter, giving access to certain information (vehicle speed, fuel level, etc) while protecting safety-critical aspects of the truck’s electronic systems. Make sure your telematics service provider uses FMS: anything else is likely to invalidate the warranty.
TYPICAL BENEFITS
IT’S NOT JUST ABOUT SAVING MONEY It is often claimed that telematics systems pay for themselves within a year. Some of the most tangible savings are likely to come from better fuel consumption because telematics can help establish how and why fuel is being wasted. Analysis of telematics reports allows operators to focus their attention on the drivers and vehicles that offer most scope for improvement. Preventing excessive engine-idling is an example of this, or finding out why drivers are departing from the best routes.
Telematics systems that raise awareness of driving style, harsh braking and acceleration, etc, should also help reduce wear and tear and thus vehicle maintenance costs. Putting a figure on this is difficult, but to demonstrate the principle, Mercedes-Benz says that in countries where truck maintenance intervals are not regulated as they are in the UK, intervals can be extended by up to 30,000km for its new Actros tractor units if fitted with FleetBoard telematics.
Operators using telematics to manage their vehicles’ movements and allocate work more effectively should see significant benefits. These are likely to be better fleet utilisation, more deliveries for fewer kilometres, reduced overtime, more on-time deliveries.
Proving your truck was nowhere near the scene of an accident, made a delivery on time or maintained a load’s temperature are other ways telematics can prove worthwhile. Some systems calculate gross vehicle weight by comparing acceleration and retardation with engine torque demand and braking forces, saving the cost of an on-board weighing system.
ISSUES TO CONSIDER
Managers with long experience will recall the ‘spy in the cab’ furore that accompanied the introduction of tachographs 30 years ago. Telematics has the potential to re-open this can of worms. Tread carefully: heavyhanded use of telematics data can cause friction.
The simple strategy of using telematics information to praise drivers – especially those who improve their driving style over time – can be enormously powerful. Driver league tables are frequently recommended but need to be used carefully. For every driver pleased to be near the top of the table or feels motivated to move upwards, there may be another lower down who feels thoroughly dispirited and alienated. Comparisons made on the basis of fuel consumption alone fail to take account of differences in vehicles and duties and can prove misleading, unfair and divisive. Driver performance assessments that use algorithms pulling together a wider range of criteria are preferable. If you access telematics data via a third party’s website, remember that you are dependent on their systems and servers and your own company’s internet connection. Check supplier claims on website uptime.
Then there is the issue of data security. You and/or your service provider should have proper backup arrangements and decent levels of data security in place. Is there a disaster recovery plan?
Finally, managers must be prepared to devote time to understanding and acting upon the data generated by a telematics system. Well-structured exception reports help focus attention where it is needed but time still must be set aside to deal with the issues highlighted.
CHOOSING A SUPPLIER
There are dozens of independent telematics service providers on the market and it can be hard to distinguish between them. Some are relatively small and may not be particularly financially stable. Others’ core focus is really outside the truck business (or outside the UK) and they may not be fully committed to this market in the long term. A good telematics system will soon become crucial to your business. It all points to the need to ask tough questions and get detailed answers – in writing.
The prioritised list of must-haves mentioned earlier is a starting point. Reeling off the list to a potential supplier is likely to elicit a response along the lines of “yes, we can do all that”. So it’s better to ask the supplier to rank its system’s features in order of competency: that could provide a more useful guide to how closely the system matches your needs.
You should: ● determine what training will be required and how much it costs ● establish what support is available and at what cost ● understand all charges, the basis for future price rises, the scope of the contract and the exit terms ● find out how your supplier intends to store, back up, use and share your data ● check the supplier’s disaster recovery plan ● check the supplier’s company accounts to establish its financial standing and trading history ● check user references to ensure the system has delivered for others: beware of casually quoted savings rather than properly measured ones ● check that the supplier has experience in fitting the hardware to your type of vehicles ● check your vehicle manufacturer and ultimate owner (eg contract hire company) does not object to the equipment or system supplier ● check GPRS coverage in areas that are important to you ● check the ability to interface with other business systems such as load-planning software and sales-order processing ● consider setting key performance indicators or a service level agreement
TRUCK MANUFACTURERS’ SYSTEMS
It is tempting to source telematics from truck manufacturers. Truck manufacturers speak our language. They are stable, global companies. There should be no compatibility or warranty issues. Vehicle manufacturers like customers to use their in-house telematics systems, particularly if the trucks are on contract hire and covered by repair and maintenance contracts. Telematics data provides visibility of the trucks’ health and use, lowering exposure to risk, so favourable contract terms may be offered on the strength of good data.
When fitting telematics systems to their own vehicles, truck makers may not restrict themselves to data available via the standard FMS interface, so can often provide more information than other systems. Equally, the systems can be still be used on other makes of vehicle, even though the data could be restricted.
If you are considering going down this route, it is important to do so for the right reasons rather than just because it is the easy, low-risk option. Does the system really suit your needs? If you switch vehicle supplier in future, will the reasons underpinning your choice of telematics system still be valid?
Top 10 telematics tips
● Justify the business reasons for having a system ● Be prepared to act on the information provided by telematics ● Think long term: it can be painful to change telematics systems ● Introduce telematics sensitively – engage the workforce ● Telematics will become an integral part of the business so choose a low-risk supplier ● When choosing a system, focus on the operational benefits rather than differences in cost ● Be conscious of driver overload: establish messaging procedures that do not distract a driver’s attention ● Interpret telematics data wisely: electronics are no substitute for knowledge or experience ● Use objective scoring to assess system suppliers ● Plan the implementation to minimise risks